Supreme Court: Bus Company Must Pay Allowances Based on Guaranteed Hours

The Hankyoreh reports on a significant Supreme Court ruling concerning Dong-A Transportation and its bus drivers, affirming that regular bonuses should be considered ordinary wages. This landmark decision mandates that the company must recalculate and pay additional allowances, including overtime and night shift pay, based on guaranteed working hours rather than actual hours logged, particularly when actual hours are less than the guaranteed amount.

The case originated from a lawsuit filed by drivers who argued that the regular bonuses paid by Dong-A Transportation qualified as ordinary wages. Consequently, they sought the recalculation of various allowances, which are typically based on ordinary wages. The lower courts had acknowledged the bonuses as ordinary wages but differed on the calculation of additional allowances, with one court siding with the company's argument to use actual working hours, even if they fell short of the agreed-upon guaranteed hours.

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If there was an agreement between labor and management to consider a certain number of hours as overtime or night work hours, regardless of the actual working hours, and the company paid overtime and night work allowances accordingly, then when recalculating unpaid overtime and night work allowances based on the re-calculated ordinary hourly wage, the guaranteed hours must be used as the standard, even if the workers' overtime and night work hours fall short of the guaranteed hours.

The Supreme Court's decision, however, firmly supports the drivers' claim. It establishes that if a labor agreement specifies guaranteed working hours for tasks like overtime or night shifts, these guaranteed hours must be used as the basis for calculating allowances, irrespective of whether the actual hours worked meet that guarantee. The court cited existing precedents, stating that employers cannot dispute the number of working hours if a collective agreement stipulates a certain duration for overtime or holiday work, regardless of the actual time spent.

From the perspective presented by The Hankyoreh, this ruling is a victory for labor rights, emphasizing the importance of contractual agreements and fair compensation. It reinforces the principle that employers must adhere to agreed-upon terms, particularly concerning wages and allowances, ensuring that workers receive the compensation they are contractually entitled to. The ruling highlights the Korean judiciary's role in protecting workers from potentially exploitative wage calculation practices and upholding the spirit of labor agreements.

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In cases where labor and management have agreed to consider a certain number of hours as overtime or holiday work hours, regardless of the actual overtime or holiday work hours, considering the specific working conditions, the employer is not permitted to dispute the working hours based on the actual working hours.