This case is an unfair dismissal decision concerning the issue of “expiry of fixed-term contract (3-year fixed term),” in which the employer ultimately prevailed (application dismissed). [Case Information] This case concerns a decision in which the employer prevailed (application dismissed) on the issue of “expiry of fixed-term contract (3-year fixed term).” Decision body: Gyeonggi Regional Labor Relations Commission, 2026Buhae2578 ○ ○ ○ Application for Remedy for Unfair Dismissal 2026-07-01 · Case result: Dismissed Key issue summary: ① The employee’s employment contract specified a contract term of 3 years (2023. 1. Legal Implications Ⅰ. Case Overview This application for remedy for unfair dismissal arose from a dispute where, at the point of expiry of a three-year fixed-term employment contract, the employer chose not to renew the contract and notified the employee of termination, and the employee challenged this before the Labor Relations Commission as an unfair dismissal. The Gyeonggi Regional Labor Relations Commission assessed the lawfulness of the termination of the employment relationship by comprehensively examining the contract term stated in the employment contract, clauses relating to renewal, and the parties’ actual practice regarding renewal. The issue in this case was whether “where a three-year contract term is expressly stated in the employment contract and there is no separate agreement or practice of renewal, the employer’s notice of termination of the employment contract given before expiry of the contract term constitutes an unfair dismissal.” The panel in this case found that the employee’s employment contract expressly provided for a three-year term (1 May 2023 – 30 April 2026), and although there was a proviso stating that “if the contract is to be extended, the intention to do so shall be notified no later than 30 days prior to the end of the contract,” there was no evidence that any expression of intent regarding extension of the contract was exchanged between the parties prior to expiry; that the employer notified the employee in writing on 29 April 2026, i.e. before expiry of the contract term, of its intention to terminate the employment contract; and that there was no history of renewal of the employment contract between the parties, nor any material indicating that the employer had promised continued employment to the employee or established a relationship of trust premised on renewal by setting renewal criteria in the work rules or similar internal regulations. In light of the above, the panel concluded that this termination should be evaluated as an “automatic termination” upon expiry of the contract term, and therefore does not constitute an unfair dismissal, and dismissed the employee’s application for remedy. Ⅱ. Summary of Issues The issue in this case was whether, under a fixed-term employment contract expressly set for three years, and in the absence of any separate agreement to renew or a repeated practice of renewal, the employer can be deemed to have an obligation to renew the contract or the employee can be recognized as having a legitimate expectation of renewal, and consequently, whether notice of expiry of the contract term amounts to an “unfair dismissal.” Ⅲ. Key Points of the Labor Relations Commission’s Decision The Labor Relations Commission relied on the following grounds: first, the contract term of three years was clearly stated in the employment contract, and in that respect the form and substance of a fixed-term employment contract were consistent; second, the proviso clause merely set out the “notification procedure in the event of extension,” and could not readily be interpreted as providing for automatic renewal or an obligation to re-contract upon certain conditions; and third, there was no history of repeated renewals with the same employee, nor any indication that renewal expectations had been formed through provisions in the work rules, collective agreements, or internal guidelines setting out standards or procedures for renewal. Accordingly, in line with the Act on the Protection, etc. of Fixed-Term and Part-Time Employees and relevant case law, the Commission reaffirmed that “an employment contract for a fixed term, absent special circumstances, automatically terminates upon expiry of that term, and the employee status extinguishes upon expiry; therefore, notice given before expiry of the intention not to renew or to terminate upon expiry cannot be regarded as a dismissal.” Ⅳ. Practical Points (From the Employee’s Perspective) From the employee’s perspective, where the employment contract specifies a contract term, it is important first to recognize that, in principle, the employment relationship automatically terminates when that term ends. To contest an unfair dismissal on the basis of a right to expect renewal or by arguing that the relationship is in substance an indefinite-term contract, it is necessary to systematically collect and organize concrete circumstances beyond a mere “possibility of extension,” such as a repeated practice of renewal, renewal criteria set out in work rules, collective agreements, or internal guidelines, and the employer’s express or implied assurances. In addition, as the contract expiry date approaches, it is advisable to confirm, in a manner that leaves a record (e.g. email, text message), the employer’s intention regarding renewal, any internal criteria for renewal, and the renewal practices for comparable employees. Such records can serve as important evidence in any subsequent application for remedy for unfair dismissal before the Labor Relations Commission. Ⅴ. Practical Points (From the Employer/Company’s Perspective) From the employer’s perspective, when utilizing fixed-term employees, it is important to clearly state in the employment contract the contract term and the principle of automatic termination upon expiry, and to consistently establish in the work rules and internal guidelines the standards for managing fixed-term employees and for determining whether to renew. Furthermore, where the relationship is to end upon expiry of the contract term, since the Labor Relations Commission and the courts place weight on the fact that this is “termination upon expiry of the term, not a dismissal,” it is advisable to notify the employee in writing in advance of the expiry date and the intention to terminate, and to avoid expressions in HR documents that could be misconstrued as “dismissal” or “disciplinary action.” In addition, if the employer repeatedly re-contracts only with certain employees, or if statements or practices accumulate that in effect guarantee renewal, disputes may arise over a right to expect renewal or over whether the relationship is in substance an indefinite-term contract. Accordingly, employers should design their approach to managing fixed-term personnel in advance and regularly review it together with experts such as Labor Law Firm Law&. This decision is a case that once again confirms, in the context of unfair dismissal and Labor Relations Commission remedy procedures, the legal principles governing “expiry of contract term” and “right to expect renewal” in fixed-term employment contracts. Both employees and employers should understand the particular characteristics of this area, which differs from collective redundancies, and reduce the potential for disputes in advance by seeking advice from specialized institutions such as Labor Law Firm Law&. 2. Matters Decided A. Case Overview and Procedural History ① The employee’s employment contract specified a contract term of three years (1 May 2023 – 30 April 2026), and included a proviso clause stipulating that “if the contract is to be extended, the intention to do so shall be notified no later than 30 days prior to the end of the contract,” but there was no evidence that any expression of intent regarding extension of the contract was made between the parties prior to expiry; ② the employer notified the employee in writing on 29 April 2026, i.e. before expiry of the contract term, of its intention to terminate the employment contract; ③ there was no history of renewal of the employment contract between the parties, and there was no indication that the employer had promised continued employment to the employee or that the work rules set out criteria for contract renewal … 3. Gist of the Decision A. Key Points of the Labor Relations Commission’s Decision ① The employee’s employment contract specified a contract term of three years (1 May 2023 – 30 April 2026), and included a proviso clause stipulating that “if the contract is to be extended, the intention to do so shall be notified no later than 30 days prior to the end of the contract,” but there was no evidence that any expression of intent regarding extension of the contract was made between the parties prior to expiry; ② the employer notified the employee in writing on 29 April 2026, i.e. before expiry of the contract term, of its intention to terminate the employment contract; ③ there was no history of renewal of the employment contract between the parties, and there was no indication that the employer had promised continued employment to the employee or that the work rules set out criteria for contract renewal … / [See More Related Decisions] - “Unfair Dismissal Decision Concerning ‘No Formation of Hiring Commitment (Absence of Offer Letter)’” – Decision date: - Case result: Original decision upheld - “Unfair Dismissal Decision Concerning ‘Expression of Intent to Resign (Resignation Statement Made by Telephone)’” - “Unfair Dismissal Decision Concerning ‘Dismissal of Application (Non-Appearance at Hearing)’” – Decision date: - Case result: Dismissed [Tags] Unfair dismissal, expiry of fixed-term contract (3-year fixed term), refusal to renew fixed-term contract, 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 Labor Law Firm Law&’s “Unfair Dismissal Decisions” series. ※ You can view the previous article, “Unfair Dismissal Decision Concerning ‘Excessive Disciplinary Measure (Use of Ice Machine for Company Dinner Expenses)’,” in a new window. ※ The list of decisions related to expiry of fixed-term contract (3-year fixed term) can be viewed together at “List of Decisions Related to Expiry of Fixed-Term Contract (3-Year Fixed Term).” ※ Korean version of this case: Korean article