Corporate trends / Performance record
Unfair Dismissal Case Concerning “Grounds for Refusal to Renew (Fixed-Term Senior Manager of a Building)” (Unfair Dismissal 89)
- Date2026/01/12 09:56
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[Case Information]
- Case name: Unfair dismissal decision concerning “grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person)”
- Date of decision:
- Case number: Dismissed
- Decision-making body: Seoul Regional Labor Relations Commission 2025Buhae3889 ○ ○ ○ Application for Remedy for Unfair Dismissal
2025.11.19
- Summary of outcome:
(a) Whether the worker is a fixed-term employee: As the worker falls under the category of an elderly person under the Act on the Promotion of Employment of Older Persons, even if he worked as a fixed-term employee for more than two years, he cannot be deemed to have been converted into a worker with an indefinite term of employment.
(b) Whether a legitimate expectation of renewal of the employment contract is recognized: Where the company has rules to the effect that the employment contract will be renewed if certain conditions are met…
1. Legal Implications
Ⅰ. Overview of the Case
This case concerns a fixed-term building manager who qualifies as an elderly person and who, after the refusal to renew his employment contract, filed an application with the Labor Relations Commission claiming that the refusal constituted unfair dismissal. The Seoul Regional Labor Relations Commission focused its decision on whether there was unfair dismissal, whether a legitimate expectation of renewal (갱신기대권) existed, and whether the grounds for refusing renewal were reasonable. In doing so, the relationship between the Act on the Protection, Etc. of Fixed-Term and Part-Time Employees (the “Fixed-Term Act”) and the Act on the Promotion of Employment of Older Persons (the “Older Persons Employment Act”) was also at issue.
Ⅱ. Key Issue
The key issue in this case is:
“Where a fixed-term worker who is an elderly person has acquired a legitimate expectation of renewal through repeated renewals, does the employer’s refusal to renew the employment contract on the grounds of performance evaluation results and work-related problems constitute unfair dismissal?”
Ⅲ. Summary of the Labor Relations Commission’s Decision
The panel in this case held that, because the worker falls under the category of an elderly person under the Older Persons Employment Act, he cannot be deemed to have been converted into a worker with no fixed term of employment even if he worked as a fixed-term employee for more than two years. It further found that, based on the company’s rules and actual practice, a trust had been formed that the contract would be renewed upon satisfaction of certain conditions, and thus a legitimate expectation of renewal existed.
In addition, the panel noted that the worker had bypassed and excluded the building manager, thereby infringing upon the manager’s authority and causing confusion in the performance of work; that the employer had issued warnings regarding violation of the chain of command and interference with personnel authority; that the worker had received a “C” grade in the performance evaluation, which fell short of the standard required for renewal; and that, even though the employer proposed a reassignment, the worker refused it, making it difficult to view the performance evaluation as a mere formal device to justify the refusal to renew.
In light of the above, the panel held that, even where a legitimate expectation of renewal is recognized, there existed the “reasonable grounds” required to refuse renewal, and therefore the employer’s action did not constitute unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
From the employee’s perspective, it is important to clearly recognize that, even for an elderly person, exceeding two years of service under the Fixed-Term Act does not automatically result in conversion to an indefinite-term (permanent) position. However, a legitimate expectation of renewal may be recognized based on company rules and a practice of repeated renewals. Accordingly, it is important to confirm in writing, on an ongoing basis, the performance evaluation criteria, renewal requirements, warning letters and points of criticism, and to manage objective materials concerning one’s work attitude and compliance with the chain of command.
Ⅴ. Practical Points (From the Employer’s Perspective)
From the employer’s perspective, the doctrine of legitimate expectation of renewal can apply equally to fixed-term workers who are elderly persons. Therefore, employers should clearly set out renewal requirements and performance evaluation criteria in employment contracts, work rules, and HR guidelines, and operate them consistently. When considering refusal to renew, employers should accumulate objective materials such as evidence of insufficient job performance, violations of the chain of command, and evaluation results, and also keep records of any process in which alternatives such as reassignment are proposed. This will make it easier to prove the reasonable grounds for refusal to renew before the Labor Relations Commission or the courts.
In cases like this, where unfair dismissal, legitimate expectation of renewal for fixed-term employees, and the Older Persons Employment Act intersect, obtaining prior advice from a specialized labor law firm such as Labor Law Firm Law& and organizing the contract structure and evaluation/operational standards in advance can be very helpful in preventing disputes.
2. Matters Decided
a. Overview of the Case and Procedural History
(a) Whether the worker is a fixed-term employee
Since the worker falls under the category of an elderly person under the Older Persons Employment Act, even if he worked as a fixed-term employee for more than two years, he cannot be deemed to have been converted into a worker with no fixed term of employment.
(b) Whether a legitimate expectation of renewal of the employment contract is recognized
Given that the company has rules to the effect that the employment contract will be renewed if certain conditions are satisfied, and that the worker had repeatedly renewed his employment contract, a legitimate expectation of renewal of the employment contract is recognized.
(c) Whether there are reasonable grounds for refusal to renew the employment contract
In light of: (i) the fact that the worker bypassed and excluded the building manager, thereby infringing upon the manager’s authority and causing confusion in the performance of work; (ii) the fact that the employer issued warnings not to violate the chain of command or interfere with personnel authority; (iii) the fact that the worker received a “C” grade in the performance evaluation, which fell short of the score required for renewal of the employment contract; and (iv) the fact that the worker refused the employer’s proposal for reassignment, making it difficult to view the performance evaluation as having been conducted solely for the purpose of refusing renewal of the employment contract, the Commission determined that there were reasonable grounds for refusal to renew the employment contract.
3. Summary of Decision
a. Summary of the Labor Relations Commission’s Reasoning
(a) Whether the worker is a fixed-term employee
Since the worker falls under the category of an elderly person under the Older Persons Employment Act, even if he worked as a fixed-term employee for more than two years, he cannot be deemed to have been converted into a worker with no fixed term of employment.
(b) Whether a legitimate expectation of renewal of the employment contract is recognized
Given that the company has rules to the effect that the employment contract will be renewed if certain conditions are satisfied, and that the worker had repeatedly renewed his employment contract, a legitimate expectation of renewal of the employment contract is recognized.
(c) Whether there are reasonable grounds for refusal to renew the employment contract
In light of: (i) the fact that the worker bypassed and excluded the building manager, thereby infringing upon the manager’s authority and causing confusion in the performance of work; (ii) the fact that the employer issued warnings not to violate the chain of command or interfere with personnel authority; (iii) the fact that the worker received a “C” grade in the performance evaluation, which fell short of the score required for renewal of the employment contract; and (iv) the fact that the worker refused the employer’s proposal for reassignment, making it difficult to view the performance evaluation as having been conducted solely for the purpose of refusing renewal of the employment contract, the Commission determined that there were reasonable grounds for refusal to renew the employment contract. /
[See More Related Decisions]
- “Unfair dismissal decision concerning ‘expression of intention to resign (resignation remarks made over the phone)’”
- “Unfair dismissal decision concerning ‘failure to satisfy requirements for redundancy dismissal (workout company)’”
- “Unfair dismissal decision concerning ‘non-formation of hiring promise (absence of offer letter)’” – Date of decision: – Case number: First-instance decision upheld
[Tags]
Unfair dismissal, grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person), refusal to renew fixed-term contract, performance evaluation · poor performance, violation of company policy · non-compliance with work instructions, 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&.
※ The previous article, “Unfair dismissal decision concerning ‘genuineness of resignation letter (disciplinary dismissal reported for employment insurance purposes)’,” can be viewed in a new window.
※ The list of decisions related to grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person) can be viewed together in the “List of decisions related to grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person).”
※ Korean version of this case: Korean article
- Case name: Unfair dismissal decision concerning “grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person)”
- Date of decision:
- Case number: Dismissed
- Decision-making body: Seoul Regional Labor Relations Commission 2025Buhae3889 ○ ○ ○ Application for Remedy for Unfair Dismissal
2025.11.19
- Summary of outcome:
(a) Whether the worker is a fixed-term employee: As the worker falls under the category of an elderly person under the Act on the Promotion of Employment of Older Persons, even if he worked as a fixed-term employee for more than two years, he cannot be deemed to have been converted into a worker with an indefinite term of employment.
(b) Whether a legitimate expectation of renewal of the employment contract is recognized: Where the company has rules to the effect that the employment contract will be renewed if certain conditions are met…
1. Legal Implications
Ⅰ. Overview of the Case
This case concerns a fixed-term building manager who qualifies as an elderly person and who, after the refusal to renew his employment contract, filed an application with the Labor Relations Commission claiming that the refusal constituted unfair dismissal. The Seoul Regional Labor Relations Commission focused its decision on whether there was unfair dismissal, whether a legitimate expectation of renewal (갱신기대권) existed, and whether the grounds for refusing renewal were reasonable. In doing so, the relationship between the Act on the Protection, Etc. of Fixed-Term and Part-Time Employees (the “Fixed-Term Act”) and the Act on the Promotion of Employment of Older Persons (the “Older Persons Employment Act”) was also at issue.
Ⅱ. Key Issue
The key issue in this case is:
“Where a fixed-term worker who is an elderly person has acquired a legitimate expectation of renewal through repeated renewals, does the employer’s refusal to renew the employment contract on the grounds of performance evaluation results and work-related problems constitute unfair dismissal?”
Ⅲ. Summary of the Labor Relations Commission’s Decision
The panel in this case held that, because the worker falls under the category of an elderly person under the Older Persons Employment Act, he cannot be deemed to have been converted into a worker with no fixed term of employment even if he worked as a fixed-term employee for more than two years. It further found that, based on the company’s rules and actual practice, a trust had been formed that the contract would be renewed upon satisfaction of certain conditions, and thus a legitimate expectation of renewal existed.
In addition, the panel noted that the worker had bypassed and excluded the building manager, thereby infringing upon the manager’s authority and causing confusion in the performance of work; that the employer had issued warnings regarding violation of the chain of command and interference with personnel authority; that the worker had received a “C” grade in the performance evaluation, which fell short of the standard required for renewal; and that, even though the employer proposed a reassignment, the worker refused it, making it difficult to view the performance evaluation as a mere formal device to justify the refusal to renew.
In light of the above, the panel held that, even where a legitimate expectation of renewal is recognized, there existed the “reasonable grounds” required to refuse renewal, and therefore the employer’s action did not constitute unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
From the employee’s perspective, it is important to clearly recognize that, even for an elderly person, exceeding two years of service under the Fixed-Term Act does not automatically result in conversion to an indefinite-term (permanent) position. However, a legitimate expectation of renewal may be recognized based on company rules and a practice of repeated renewals. Accordingly, it is important to confirm in writing, on an ongoing basis, the performance evaluation criteria, renewal requirements, warning letters and points of criticism, and to manage objective materials concerning one’s work attitude and compliance with the chain of command.
Ⅴ. Practical Points (From the Employer’s Perspective)
From the employer’s perspective, the doctrine of legitimate expectation of renewal can apply equally to fixed-term workers who are elderly persons. Therefore, employers should clearly set out renewal requirements and performance evaluation criteria in employment contracts, work rules, and HR guidelines, and operate them consistently. When considering refusal to renew, employers should accumulate objective materials such as evidence of insufficient job performance, violations of the chain of command, and evaluation results, and also keep records of any process in which alternatives such as reassignment are proposed. This will make it easier to prove the reasonable grounds for refusal to renew before the Labor Relations Commission or the courts.
In cases like this, where unfair dismissal, legitimate expectation of renewal for fixed-term employees, and the Older Persons Employment Act intersect, obtaining prior advice from a specialized labor law firm such as Labor Law Firm Law& and organizing the contract structure and evaluation/operational standards in advance can be very helpful in preventing disputes.
2. Matters Decided
a. Overview of the Case and Procedural History
(a) Whether the worker is a fixed-term employee
Since the worker falls under the category of an elderly person under the Older Persons Employment Act, even if he worked as a fixed-term employee for more than two years, he cannot be deemed to have been converted into a worker with no fixed term of employment.
(b) Whether a legitimate expectation of renewal of the employment contract is recognized
Given that the company has rules to the effect that the employment contract will be renewed if certain conditions are satisfied, and that the worker had repeatedly renewed his employment contract, a legitimate expectation of renewal of the employment contract is recognized.
(c) Whether there are reasonable grounds for refusal to renew the employment contract
In light of: (i) the fact that the worker bypassed and excluded the building manager, thereby infringing upon the manager’s authority and causing confusion in the performance of work; (ii) the fact that the employer issued warnings not to violate the chain of command or interfere with personnel authority; (iii) the fact that the worker received a “C” grade in the performance evaluation, which fell short of the score required for renewal of the employment contract; and (iv) the fact that the worker refused the employer’s proposal for reassignment, making it difficult to view the performance evaluation as having been conducted solely for the purpose of refusing renewal of the employment contract, the Commission determined that there were reasonable grounds for refusal to renew the employment contract.
3. Summary of Decision
a. Summary of the Labor Relations Commission’s Reasoning
(a) Whether the worker is a fixed-term employee
Since the worker falls under the category of an elderly person under the Older Persons Employment Act, even if he worked as a fixed-term employee for more than two years, he cannot be deemed to have been converted into a worker with no fixed term of employment.
(b) Whether a legitimate expectation of renewal of the employment contract is recognized
Given that the company has rules to the effect that the employment contract will be renewed if certain conditions are satisfied, and that the worker had repeatedly renewed his employment contract, a legitimate expectation of renewal of the employment contract is recognized.
(c) Whether there are reasonable grounds for refusal to renew the employment contract
In light of: (i) the fact that the worker bypassed and excluded the building manager, thereby infringing upon the manager’s authority and causing confusion in the performance of work; (ii) the fact that the employer issued warnings not to violate the chain of command or interfere with personnel authority; (iii) the fact that the worker received a “C” grade in the performance evaluation, which fell short of the score required for renewal of the employment contract; and (iv) the fact that the worker refused the employer’s proposal for reassignment, making it difficult to view the performance evaluation as having been conducted solely for the purpose of refusing renewal of the employment contract, the Commission determined that there were reasonable grounds for refusal to renew the employment contract. /
[See More Related Decisions]
- “Unfair dismissal decision concerning ‘expression of intention to resign (resignation remarks made over the phone)’”
- “Unfair dismissal decision concerning ‘failure to satisfy requirements for redundancy dismissal (workout company)’”
- “Unfair dismissal decision concerning ‘non-formation of hiring promise (absence of offer letter)’” – Date of decision: – Case number: First-instance decision upheld
[Tags]
Unfair dismissal, grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person), refusal to renew fixed-term contract, performance evaluation · poor performance, violation of company policy · non-compliance with work instructions, 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&.
※ The previous article, “Unfair dismissal decision concerning ‘genuineness of resignation letter (disciplinary dismissal reported for employment insurance purposes)’,” can be viewed in a new window.
※ The list of decisions related to grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person) can be viewed together in the “List of decisions related to grounds for refusal to renew (fixed-term senior manager of a building who is an elderly person).”
※ Korean version of this case: Korean article
