[Case Information] This case is a decision in which the employer ultimately prevailed (application dismissed) on the issue of “denial of employee status (service contract).” Date of Decision: 2026-07-06 · Labor Relations Commission: Gyeonggi Regional Labor Relations Commission · Case No.: 2026부해1670 Summary of Key Issues: The final written agreement between the parties was a service contract, not an employment contract; the contract appears to have been concluded without any separate recruitment process, based instead on the applicant’s experience and knowledge in the same line of business and expectations of increased sales; no specific instructions or supervision regarding work were found, and reports on key matters such as sales appear to have been made ex post merely for confirmation; unlike other employees, the applicant’s attendance was not managed… 1. Legal Implications Ⅰ. Case Overview In this decision, an operator who had entered into a management consignment agreement filed for relief from unfair dismissal, claiming to be an employee under the Labor Standards Act. The Gyeonggi Regional Labor Relations Commission, however, denied the applicant’s standing on the ground that he/she was not an employee. The Commission comprehensively reviewed the form of the contract, the actual manner in which work was performed, and the method of remuneration, and concluded that the applicant was not a subordinate employee of the employer but a service provider under a management consignment agreement. Ⅱ. Issues in Dispute The issue in this case is: “Whether a service provider under a contract in the form of a management consignment agreement can, in substance, be regarded as an employee subordinated to the employer under the Labor Standards Act, such that he/she has standing (qualification as applicant) to file for relief from unfair dismissal.” Ⅲ. Summary of the Labor Relations Commission’s Reasoning The panel in this case noted that the final written agreement between the parties was a service contract for management consignment, not an employment contract; that the contract appears to have been concluded without any open recruitment or hiring process, based on the applicant’s experience and knowledge in the same line of business and the expectation of increased sales; and that no specific instructions or supervision regarding work were identified, and even with respect to key matters such as sales, only ex post reporting for confirmation appears to have taken place. In addition, unlike other employees, the applicant’s attendance does not appear to have been managed at all; the monthly amounts paid appear to have been set as remuneration for the overall operation of the business site rather than as consideration for labor; and the applicant does not appear to have been enrolled in the four major social insurances. In light of all these circumstances, the Commission found that there is substantial room to regard the worker as an independent service provider who entered into a management consignment agreement with the employer, and that, even when the Supreme Court’s criteria for determining employee status (who determines the content of the work, the degree of direction and supervision, whether working hours and place of work are designated, the nature of remuneration, whether enrolled in social insurance, etc.) are considered comprehensively, it is difficult to view the applicant as an employee under the employer’s direction and supervision. Accordingly, the applicant was held not to have standing as an applicant for relief from unfair dismissal. Ⅳ. Practical Points (From the Employee’s Perspective) For a worker to challenge an unfair dismissal, he or she must first be recognized as an employee under the Labor Standards Act; only then will the Labor Relations Commission proceed to a hearing on the merits. Even where the contract is titled management consignment, subcontract, commission, or similar, if in reality the worker is subject to the employer’s specific direction and supervision, has designated working hours and place of work, receives fixed pay in the nature of wages, and is enrolled in the four major social insurances, there is a possibility that employee status will be recognized. It is therefore advisable to systematically retain evidence of such circumstances on an ongoing basis. In particular, one should carefully examine whether one is an independent business operator bearing the risks relating to sales and profits, or merely a worker providing labor under conditions set by the employer in return for remuneration. If you are considering filing for relief from unfair dismissal, do not rely solely on the title of the contract; instead, focus on whether a relationship of subordination actually exists, and first confirm your employee status and standing as an applicant through consultation with experts such as Labor Law Firm Law&. Ⅴ. Practical Points (From the Employer/Company’s Perspective) From the employer’s standpoint, in order to prevent disputes over redundancy dismissals or contract terminations, it is important, when using atypical contracts such as management consignment, subcontract, or commission, to design the structure clearly so that it does not become mixed with employee status. Unless the method of determining work content, the degree of constraint regarding working hours and place of work, the intensity of direction and supervision, the basis for calculating remuneration, and the status of social insurance enrollment are operated consistently in line with an independent contractor structure, a contract that is formally a management consignment agreement may in substance be evaluated as an employment contract. Employers should also be careful to ensure that, in practice, typical HR/labor management such as attendance control, performance evaluations, and detailed work instructions is not applied to consignment contractors on site. When an unfair dismissal dispute arises, the Labor Relations Commission places more weight on the substantive relationship of subordination than on the title of the contract. Accordingly, companies should align their documentation and operational practices from the contract formation stage and, where necessary, review risks with the assistance of experts such as Labor Law Firm Law&. 2. Matters Decided a. Case Overview and Procedural History This is a case in which it was held that a worker, as a party to a management consignment agreement, is difficult to regard as an employee under the Labor Standards Act, and therefore lacks standing (qualification as applicant) to seek relief. 3. Summary of Decision a. Summary of the Labor Relations Commission’s Reasoning In this case, the final written agreement between the worker and the employer was a service contract, not an employment contract; the contract appears to have been concluded based on the applicant’s experience and knowledge in the same line of business and expectations of increased sales, without any separate recruitment process; no specific instructions or supervision regarding work were identified; and with respect to key matters such as sales at the business site, the employer appears to have received only ex post reports for confirmation. Unlike other employees, the applicant’s attendance does not appear to have been managed separately; the monthly payments appear to have been set as remuneration for the overall operation of the business site rather than as consideration for labor; and the applicant does not appear to have been enrolled in the four major social insurances. In light of these factors, the worker is viewed as a service provider who entered into a management consignment agreement with the employer, and it is difficult to regard the worker as an employee under the employer’s direction and supervision. [See More Related Decisions] - “Expectation of Employment Succession (Competitive Bidding for Logistics Center)” in Unfair Dismissal Decision - “Non-Formation of Hiring Commitment (Absence of Offer Letter)” in Unfair Dismissal Decision – Date of Decision: - · Case No.: Original Decision Upheld - “Relief Interest · Refusal to Rehire (Post-Retirement Fixed-Term Employee)” in Unfair Dismissal Decision [Tags] Unfair dismissal, denial of employee status (service contract), 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 part of the “Unfair Dismissal Decisions” series by Labor Law Firm Law&. ※ You can view the previous article, “‘Employment Relationship (Event Helper Daily Worker)’ in Unfair Dismissal Decision,” in a new window. ※ A list of decisions related to denial of employee status (service contract) can be found in the “List of Decisions Related to Denial of Employee Status (Service Contract).” ※ Korean version of this case: Korean article