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‘Legitimate Expectation of Employment Succession (Change of Service Provider)’ – Unfair Dismissal Decision (Unfair Dismissal 428)
- Date2026/05/05 04:04
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[Case Information]
This case is a decision in which the employer prevailed (application dismissed) on the issue of “legitimate expectation of employment succession (change of service provider).”
Decision body: Gyeonggi Regional Labor Relations Commission 2026Buhae322 ○ ○ ○ Application for Remedy for Unfair Dismissal
2026.03.31 · Case result: Dismissed
Key issues in summary: (i) The subcontracted service agreement entered into by the employer did not contain any separate provision confirming that employees of the previous service provider would have their employment succeeded; (ii) The employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; (iii) Even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this fact alone does not provide grounds to regard them as a single company; (iv) The employee and other workers who had worked for the previous service provider...
1. Legal Implications
Ⅰ. Case Overview
In this application for remedy for unfair dismissal, the employee, who had continued working after the service provider was changed, filed for relief with the Labor Relations Commission claiming unfair dismissal when the employment relationship later ended upon expiry of the newly agreed contract period. The Gyeonggi Regional Labor Relations Commission examined the contents of the subcontracted service agreement entered into by the employer, the wording of the employment contract, and the existence or non‑existence of any practice of employment succession, and focused its analysis on whether the employee’s legitimate expectation of employment succession could be recognized.
The key issue in this case is whether, in the course of a change of service provider, an employee can be recognized as having a legitimate expectation of employment succession even in the absence of any separate agreement or established practice, and, accordingly, whether termination of the employment relationship upon expiry of the contract period constitutes unfair dismissal.
Ⅱ. Summary of Issues
The issue in this case is whether, under a subcontracted service structure, where an employee who had worked for the previous service provider continued working by entering into a new employment contract with the new service provider, a “legitimate expectation of employment succession” or a “legitimate expectation of contract renewal” can be recognized despite the absence of any specific agreement or practice regarding employment succession. In other words, the core question is whether the mere fact of continued work at the same workplace can, by itself, be regarded as creating a situation akin to a redundancy dismissal that warrants similar protection as an unfair dismissal.
Ⅲ. Summary of the Labor Relations Commission’s Reasoning
The decision panel in this case held that: the subcontracted service agreement entered into by the employer contained no provision whatsoever on succession of employment of the previous service provider’s employees; the employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this alone does not provide grounds to regard them as the same company; and it is difficult to view the fact that the employee and other workers from the previous service provider had each entered into separate employment contracts with the new employer and continued working in the same manner as having formed a practice of employment succession or a legitimate expectation thereof.
Accordingly, the Commission found it difficult to recognize that the employee had a legitimate expectation of employment succession or contract renewal.
The termination at issue in this case was found to be termination of the employment relationship due to expiry of the contract period and was therefore held not to constitute unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
Where an employee works under a fixed‑term or service‑contract arrangement, asserting unfair dismissal requires more than a mere “experience of continuous work.” The employee must prove that a “legitimate expectation” has been formed, based on grounds such as an agreement on employment succession, provisions on re‑employment in the employment contract, work rules or collective agreements, or a repeated practice of contract renewal. In workplaces where service providers change frequently, it is particularly important to check in advance whether the bid announcement or service contract contains any “recommendation or obligation to rehire existing employees,” and whether, in practice, most employees have in fact been rehired upon previous changes.
Ⅴ. Practical Points (From the Employer/Company’s Perspective)
From the employer’s standpoint, if the subcontracted service agreement does not expressly stipulate an obligation of employment succession, it is necessary to manage HR operation patterns so that the blanket re‑hiring of all existing employees is not repeatedly treated as a matter of course in practice. In addition, fixed‑term employment contracts should clearly specify the contract period, automatic termination clause, and the company’s discretion regarding renewal, and, at the time of contract expiry, the employer should consistently implement termination procedures in accordance with those terms in order to reduce the risk that the Labor Relations Commission or the courts will regard the termination as unfair dismissal.
To prevail in this type of case, it is important to fully understand the case law and Labor Relations Commission principles on “legitimate expectation of employment succession” and “legitimate expectation of contract renewal,” and to systematically organize and manage relevant materials such as service contracts, employment contracts, and actual practices.
2. Matters Determined
A. Case Overview and Procedural History
In light of the following: (i) the subcontracted service agreement entered into by the employer contained no separate provision confirming that employment of employees belonging to the previous service provider would be succeeded; (ii) the employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; (iii) even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this fact alone does not provide grounds to regard them as a single company; (iv) although the employee and other workers who had worked for the previous service provider entered into employment contracts with the employer and have been working under the same conditions, there appears to be no basis to view such continued work as arising from a legitimate expectation of employment succession; and (v) there is no evidence to suggest that a practice of employment succession had been established when the service provider preceding the employer was replaced; it was concluded that the employee did not have a legitimate expectation of employment succession.
3. Summary of the Decision
A. Summary of the Labor Relations Commission’s Reasoning
In light of the following: (i) the subcontracted service agreement entered into by the employer contained no separate provision confirming that employment of employees belonging to the previous service provider would be succeeded; (ii) the employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; (iii) even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this fact alone does not provide grounds to regard them as a single company; (iv) although the employee and other workers who had worked for the previous service provider entered into employment contracts with the employer and have been working under the same conditions, there appears to be no basis to view such continued work as arising from a legitimate expectation of employment succession; and (v) there is no evidence to suggest that a practice of employment succession had been established when the service provider preceding the employer was replaced; the Commission held that the employee did not have a legitimate expectation of employment succession. /
[See More Related Decisions]
- “‘Dismissal of Application (Non‑appearance at Hearing)’ – Unfair Dismissal Decision” – Decision date: – Case result: Dismissed
- “‘Non‑formation of Hiring Commitment (Absence of Offer Letter)’ – Unfair Dismissal Decision” – Decision date: – Case result: First‑instance decision upheld
- “‘Expression of Intention to Resign (Resignation Remark in Telephone Call)’ – Unfair Dismissal Decision”
[Tags]
Unfair dismissal, legitimate expectation of employment succession (change of service provider), others, Labor Law Firm Law&, large labor law firm, Samseong‑dong labor law firm, Samseong Station labor law firm, Gangnam labor law firm
※ This article is one of the “Unfair Dismissal Decisions” series by Labor Law Firm Law&.
※ You can view the previous article, “‘Legitimate Expectation of Employment Succession (Apartment Security Guard)’ – Unfair Dismissal Decision,” in a new window.
※ The list of decisions related to “legitimate expectation of employment succession (change of service provider)” can be viewed together at “List of Decisions on Legitimate Expectation of Employment Succession (Change of Service Provider).”
※ Korean version of this case: Korean article
This case is a decision in which the employer prevailed (application dismissed) on the issue of “legitimate expectation of employment succession (change of service provider).”
Decision body: Gyeonggi Regional Labor Relations Commission 2026Buhae322 ○ ○ ○ Application for Remedy for Unfair Dismissal
2026.03.31 · Case result: Dismissed
Key issues in summary: (i) The subcontracted service agreement entered into by the employer did not contain any separate provision confirming that employees of the previous service provider would have their employment succeeded; (ii) The employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; (iii) Even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this fact alone does not provide grounds to regard them as a single company; (iv) The employee and other workers who had worked for the previous service provider...
1. Legal Implications
Ⅰ. Case Overview
In this application for remedy for unfair dismissal, the employee, who had continued working after the service provider was changed, filed for relief with the Labor Relations Commission claiming unfair dismissal when the employment relationship later ended upon expiry of the newly agreed contract period. The Gyeonggi Regional Labor Relations Commission examined the contents of the subcontracted service agreement entered into by the employer, the wording of the employment contract, and the existence or non‑existence of any practice of employment succession, and focused its analysis on whether the employee’s legitimate expectation of employment succession could be recognized.
The key issue in this case is whether, in the course of a change of service provider, an employee can be recognized as having a legitimate expectation of employment succession even in the absence of any separate agreement or established practice, and, accordingly, whether termination of the employment relationship upon expiry of the contract period constitutes unfair dismissal.
Ⅱ. Summary of Issues
The issue in this case is whether, under a subcontracted service structure, where an employee who had worked for the previous service provider continued working by entering into a new employment contract with the new service provider, a “legitimate expectation of employment succession” or a “legitimate expectation of contract renewal” can be recognized despite the absence of any specific agreement or practice regarding employment succession. In other words, the core question is whether the mere fact of continued work at the same workplace can, by itself, be regarded as creating a situation akin to a redundancy dismissal that warrants similar protection as an unfair dismissal.
Ⅲ. Summary of the Labor Relations Commission’s Reasoning
The decision panel in this case held that: the subcontracted service agreement entered into by the employer contained no provision whatsoever on succession of employment of the previous service provider’s employees; the employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this alone does not provide grounds to regard them as the same company; and it is difficult to view the fact that the employee and other workers from the previous service provider had each entered into separate employment contracts with the new employer and continued working in the same manner as having formed a practice of employment succession or a legitimate expectation thereof.
Accordingly, the Commission found it difficult to recognize that the employee had a legitimate expectation of employment succession or contract renewal.
The termination at issue in this case was found to be termination of the employment relationship due to expiry of the contract period and was therefore held not to constitute unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
Where an employee works under a fixed‑term or service‑contract arrangement, asserting unfair dismissal requires more than a mere “experience of continuous work.” The employee must prove that a “legitimate expectation” has been formed, based on grounds such as an agreement on employment succession, provisions on re‑employment in the employment contract, work rules or collective agreements, or a repeated practice of contract renewal. In workplaces where service providers change frequently, it is particularly important to check in advance whether the bid announcement or service contract contains any “recommendation or obligation to rehire existing employees,” and whether, in practice, most employees have in fact been rehired upon previous changes.
Ⅴ. Practical Points (From the Employer/Company’s Perspective)
From the employer’s standpoint, if the subcontracted service agreement does not expressly stipulate an obligation of employment succession, it is necessary to manage HR operation patterns so that the blanket re‑hiring of all existing employees is not repeatedly treated as a matter of course in practice. In addition, fixed‑term employment contracts should clearly specify the contract period, automatic termination clause, and the company’s discretion regarding renewal, and, at the time of contract expiry, the employer should consistently implement termination procedures in accordance with those terms in order to reduce the risk that the Labor Relations Commission or the courts will regard the termination as unfair dismissal.
To prevail in this type of case, it is important to fully understand the case law and Labor Relations Commission principles on “legitimate expectation of employment succession” and “legitimate expectation of contract renewal,” and to systematically organize and manage relevant materials such as service contracts, employment contracts, and actual practices.
2. Matters Determined
A. Case Overview and Procedural History
In light of the following: (i) the subcontracted service agreement entered into by the employer contained no separate provision confirming that employment of employees belonging to the previous service provider would be succeeded; (ii) the employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; (iii) even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this fact alone does not provide grounds to regard them as a single company; (iv) although the employee and other workers who had worked for the previous service provider entered into employment contracts with the employer and have been working under the same conditions, there appears to be no basis to view such continued work as arising from a legitimate expectation of employment succession; and (v) there is no evidence to suggest that a practice of employment succession had been established when the service provider preceding the employer was replaced; it was concluded that the employee did not have a legitimate expectation of employment succession.
3. Summary of the Decision
A. Summary of the Labor Relations Commission’s Reasoning
In light of the following: (i) the subcontracted service agreement entered into by the employer contained no separate provision confirming that employment of employees belonging to the previous service provider would be succeeded; (ii) the employee’s employment contract expressly stated that the employment relationship would automatically terminate upon expiry of the contract period without separate notice; (iii) even if the employer and the previous service provider maintained offices in the same building under different suite numbers, this fact alone does not provide grounds to regard them as a single company; (iv) although the employee and other workers who had worked for the previous service provider entered into employment contracts with the employer and have been working under the same conditions, there appears to be no basis to view such continued work as arising from a legitimate expectation of employment succession; and (v) there is no evidence to suggest that a practice of employment succession had been established when the service provider preceding the employer was replaced; the Commission held that the employee did not have a legitimate expectation of employment succession. /
[See More Related Decisions]
- “‘Dismissal of Application (Non‑appearance at Hearing)’ – Unfair Dismissal Decision” – Decision date: – Case result: Dismissed
- “‘Non‑formation of Hiring Commitment (Absence of Offer Letter)’ – Unfair Dismissal Decision” – Decision date: – Case result: First‑instance decision upheld
- “‘Expression of Intention to Resign (Resignation Remark in Telephone Call)’ – Unfair Dismissal Decision”
[Tags]
Unfair dismissal, legitimate expectation of employment succession (change of service provider), others, Labor Law Firm Law&, large labor law firm, Samseong‑dong labor law firm, Samseong Station labor law firm, Gangnam labor law firm
※ This article is one of the “Unfair Dismissal Decisions” series by Labor Law Firm Law&.
※ You can view the previous article, “‘Legitimate Expectation of Employment Succession (Apartment Security Guard)’ – Unfair Dismissal Decision,” in a new window.
※ The list of decisions related to “legitimate expectation of employment succession (change of service provider)” can be viewed together at “List of Decisions on Legitimate Expectation of Employment Succession (Change of Service Provider).”
※ Korean version of this case: Korean article
