[Case Information] This case is a decision that was concluded with the first-instance decision being upheld, concerning the issue of “lack of business necessity (transfer of low performers · non-payment of project incentives).” Decision Committee: Central Labor Relations Commission 2026BuHae71 ○ ○ ○ Application for Re-Examination of Remedy for Unfair Dismissal 2026-07-03 · Case Result: First-Instance Decision Upheld Key Issue Summary: (a) 1. Legal Implications Ⅰ. Case Overview In this unfair dismissal case, the employer implemented a transfer measure targeting a low performer, after which an application for remedy for unfair transfer and unfair dismissal was filed with the Labor Relations Commission and proceeded up to re-examination before the Central Labor Relations Commission. In addition to the transfer, the issues included whether the non-payment of project incentives and the failure to set a return date caused economic and livelihood disadvantages to the employee. Ultimately, the Labor Relations Commission focused its examination on the legitimacy of the performance evaluation and the transfer. Ⅱ. Summary of Issues The issue in this case is “whether a transfer targeting a low performer can be recognized as having business necessity even when it is carried out without objective criteria and procedures for performance evaluation, and whether the livelihood disadvantages arising from non-payment of project incentives and the failure to set a return date exceed the scope of disadvantages that employees are ordinarily expected to endure.” Ⅲ. Summary of the Labor Relations Commission’s Reasoning The panel in this case held that, even if the employer asserted a general managerial need for the transfer of a low performer, it was difficult to recognize business necessity for the transfer itself, in light of the following: there were no rules on the specific criteria and methods of performance evaluation; the evaluation items and rating methods were not subdivided or objectified, making it inevitable to rely excessively on the evaluator’s subjective judgment; and it was difficult to regard such evaluation as an appropriate means to achieve the managerial purpose when used as the basis for the transfer. The Commission therefore found this dismissal to be unfair, taking into comprehensive account the difficulty in recognizing business necessity for the transfer itself and the fact that economic and livelihood disadvantages had arisen for the employee due to the non-payment of project incentives and the assignment without a fixed return date. Ⅳ. Practical Points (From the Employee’s Perspective) From the employee’s perspective, when there is a personnel measure such as transfer of a low performer, placement on standby, or reassignment, you should first check whether the company’s performance evaluation criteria exist in written form and whether the evaluation items and rating methods are established in a specific and objective manner. If the transfer results in the loss of incentives or if the return date is unclear so that long-term disadvantages to income and career are expected, it is important to leave a record of the content and timing via email, messenger, etc. Such records can become key evidence in a subsequent application for remedy for unfair dismissal before the Labor Relations Commission. Ⅴ. Practical Points (From the Employer’s Perspective) From the company’s perspective, it should be borne in mind that the core issue is not the mere fact of designating low performers as subjects of transfer, but how the objectivity and fairness of the underlying performance evaluation have been ensured. Evaluation items should be subdivided, and the evaluation guidelines, calculation methods, evaluator training, and procedures for providing an opportunity to explain should be clearly stipulated in rules. Where the transfer significantly increases livelihood disadvantages, such as reduction of incentives or an unclear return date, supplementary measures (such as setting a period, establishing compensation standards, etc.) should be designed in advance to mitigate such disadvantages. (ⓒ2026 copyright. Labor Attorney Youngseop Moon, Labor Law Firm Law&. Unauthorized reproduction and redistribution are prohibited.) 2. Matters Decided a. Case Overview and Procedural History a. Whether Business Necessity Existed Even if general managerial necessity is recognized for a transfer targeting a low performer, it is difficult to recognize business necessity, because there are no rules on the specific criteria and methods of performance evaluation, it is inevitable to rely on the evaluator’s subjective judgment, and even the minimum subdivided and objectified evaluation items and rating methods that could ensure the objective rationality and fairness of the evaluation cannot be identified. Accordingly, it is difficult to recognize the suitability of the transfer as a means to achieve the managerial purpose, and thus difficult to recognize business necessity. b. Whether There Was Livelihood Disadvantage It is difficult to conclude that there was no economic disadvantage at all, given the non-payment of project incentives, and the absence of a fixed return date… 3. Gist of the Decision a. Summary of the Labor Relations Commission’s Reasoning a. Whether Business Necessity Existed Even if general managerial necessity is recognized for a transfer targeting a low performer, it is difficult to recognize business necessity, because there are no rules on the specific criteria and methods of performance evaluation, it is inevitable to rely on the evaluator’s subjective judgment, and even the minimum subdivided and objectified evaluation items and rating methods that could ensure the objective rationality and fairness of the evaluation cannot be identified. Accordingly, it is difficult to recognize the suitability of the transfer as a means to achieve the managerial purpose, and thus difficult to recognize business necessity. b. Whether There Was Livelihood Disadvantage It is difficult to conclude that there was no economic disadvantage at all, given the non-payment of project incentives, and the absence of a fixed return date… / [See More Related Decisions] - ‘Failure to Meet Requirements for Redundancy Dismissal (Workout Company)’ Unfair Dismissal Decision - ‘Non-Formation of Hiring Commitment (Absence of Offer Letter)’ Unfair Dismissal Decision – Date of Decision: – Case Result: First-Instance Decision Upheld - ‘Disciplinary Sanction Level (Unauthorized Sale of Goods · Misuse of Subsidies)’ Unfair Dismissal Decision [Tags] Unfair dismissal, lack of business necessity (transfer of low performers · non-payment of project incentives), performance evaluation · poor performance, 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, “‘Disciplinary Sanction Level (Unauthorized Sale of Goods · Misuse of Subsidies)’ Unfair Dismissal Decision,” in a new window. ※ The list of decisions related to lack of business necessity (transfer of low performers · non-payment of project incentives) can be viewed together in the “List of Decisions Related to Lack of Business Necessity (Transfer of Low Performers · Non-Payment of Project Incentives).” ※ Korean version of this case: Korean article