Corporate trends / Performance record
Non-Existence of Renewal Expectation Right (Performance Evaluation · Absence of Work Rules) in Unfair Dismissal Decision (Unfair Dismissal 583)
- Date2026/07/29 04:12
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This case concerns a decision in which the employer prevailed (application dismissed) on the issue of “non-existence of renewal expectation right (performance evaluation · absence of work rules).”
Decision Body: Jeonnam Regional Labor Relations Commission 2026Buhae319 ○ ○ ○ Application for Remedy for Unfair Dismissal
2026-05-21 · Case result: Dismissed
Key issues in summary: (i) The “employment contract” specified only the start and end dates of the contract period, and no provision could be found to the effect that the employment contract would be renewed upon satisfaction of certain conditions even after expiry of the term; (ii) there were no work rules applicable to the employees; (iii) in February 2026 the employer conducted a performance evaluation.
1. Legal Implications
Ⅰ. Case Overview
This unfair dismissal case arose when a fixed-term employee, whose contract was not renewed upon expiry, filed an application with the Labor Relations Commission for a remedy for unfair dismissal. The Jeonnam Regional Labor Relations Commission examined the contents of the employment contract, the existence of work rules, the nature of the performance evaluation, and the presence or absence of any renewal practice, and on that basis determined whether the case constituted unfair dismissal. This article reviews the Commission’s reasoning structure and, from the practical perspective of Labor Law Firm Law&, organizes the legal principles on renewal expectation rights.
Ⅱ. Issues
The issue in this case is whether, “where only the contract period is specified in the employment contract and there are no work rules or renewal criteria, the employer’s decision not to renew the contract after expiry of the term constitutes unfair dismissal.” In other words, the core question is whether, despite the formal characterization as a fixed-term contract, the employee can be recognized as having a “legitimate expectation of renewal” to continue working.
Ⅲ. Summary of the Labor Relations Commission’s Reasoning
The decision panel in this case noted that: (i) the employment contract stated only the commencement and termination dates of the contract period and contained no provision whatsoever that the contract would be renewed upon satisfaction of certain conditions; (ii) there were no work rules applicable to the employee, and thus no internal regulations setting out renewal conditions or procedures; (iii) the performance evaluation conducted by the employer in February 2026 was for the purpose of setting criteria for performance-based bonuses, not for determining whether to renew the contract; and (iv) there had been no instances of contract renewal for the employees first hired in the business, so no practice akin to “repeated renewal” or “automatic renewal” had been established.
In light of the employment contract, internal regulations, and actual operational practices taken together, the Commission found it difficult to conclude that a relationship of trust had been formed to the effect that “the contract will be renewed if certain conditions are met,” i.e., that a renewal expectation right had been established. The termination in this case was therefore regarded as an automatic termination upon expiry of the contract term, and it was held not to constitute unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
From the employee’s standpoint, if the employment contract merely specifies the contract period and there are no concrete renewal conditions set out in work rules, collective agreements, or HR guidelines, then statements such as “if you work hard, we’ll keep you on,” or one or two short-term renewals alone will generally not suffice to establish a renewal expectation right. On the premise that, unlike redundancy or ordinary dismissal, simple expiry of a fixed-term contract is in principle not considered a dismissal, an employee who wishes to assert a renewal expectation right should, in advance, collect objective evidence such as repeated renewals, explicit renewal provisions, or a consistent renewal practice for comparable employees.
Ⅴ. Practical Points (From the Employer’s/Company’s Perspective)
From the company’s perspective, when using fixed-term employment contracts, it is helpful for dispute prevention to clearly state in the employment contract that “the contract will automatically terminate upon expiry of the contract period without any further action,” and to specify in the work rules or HR guidelines that renewal is a matter of discretionary judgment. In addition, even when conducting performance evaluations, the company should clearly distinguish in writing whether the purpose is to calculate performance-based bonuses or to decide on renewal, in order to reduce unnecessary disputes over renewal expectation rights.
To prevail in this type of case, it is essential to accurately understand the legal principles on renewal expectation rights established by the Supreme Court and the Labor Relations Commissions, and to systematically organize and present to the Commission the relevant facts, including the wording of the employment contract, the existence of work rules, the purpose of performance evaluations, and actual renewal practices.
2. Matters Determined
A. Case Overview and Procedural History
Considering that: (i) the “employment contract” specified only the start and end dates of the contract period, and no provision could be found to the effect that the employment contract would be renewed upon satisfaction of certain conditions even after expiry of the term; (ii) there were no work rules applicable to the employees; (iii) the performance evaluation conducted by the employer in February 2026 was for the purpose of setting criteria for payment of performance-based bonuses; and (iv) as the employees first hired in the business had never had their contracts renewed, there was no renewal practice in place, it can be concluded that the employment contract entered into by the parties did not contain any provision to the effect that the employment contract would be renewed upon satisfaction of certain conditions, and…
3. Gist of the Decision
A. Summary of the Labor Relations Commission’s Reasoning
Considering that: (i) the “employment contract” specified only the start and end dates of the contract period, and no provision could be found to the effect that the employment contract would be renewed upon satisfaction of certain conditions even after expiry of the term; (ii) there were no work rules applicable to the employees; (iii) the performance evaluation conducted by the employer in February 2026 was for the purpose of setting criteria for payment of performance-based bonuses; and (iv) as the employees first hired in the business had never had their contracts renewed, there was no renewal practice in place, it can be concluded that the employment contract entered into by the parties did not contain any provision to the effect that the employment contract would be renewed upon satisfaction of certain conditions, and… /
[Further Related Decisions]
- “Unfair Dismissal Decision on Probationary Dismissal (Change in Probation Evaluation)”
- “Unfair Dismissal Decision on Expression of Intention to Resign (Resignation Remark in Telephone Call)”
- “Unfair Dismissal Decision on Non-Formation of Hiring Commitment (Absence of Offer Letter)” – Date of decision: – Case result: First-instance decision upheld
[Tags]
Unfair dismissal, non-existence of renewal expectation right (performance evaluation · absence of work rules), 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 the “Unfair Dismissal Decisions” series by Labor Law Firm Law&.
※ You can view the previous article, “Unfair Dismissal Decision on Probationary Dismissal (Change in Probation Evaluation),” in a new window.
※ The list of decisions related to non-existence of renewal expectation right (performance evaluation · absence of work rules) can be viewed together in the “List of Decisions on Non-Existence of Renewal Expectation Right (Performance Evaluation · Absence of Work Rules).”
※ Korean version of this case: Korean article
Decision Body: Jeonnam Regional Labor Relations Commission 2026Buhae319 ○ ○ ○ Application for Remedy for Unfair Dismissal
2026-05-21 · Case result: Dismissed
Key issues in summary: (i) The “employment contract” specified only the start and end dates of the contract period, and no provision could be found to the effect that the employment contract would be renewed upon satisfaction of certain conditions even after expiry of the term; (ii) there were no work rules applicable to the employees; (iii) in February 2026 the employer conducted a performance evaluation.
1. Legal Implications
Ⅰ. Case Overview
This unfair dismissal case arose when a fixed-term employee, whose contract was not renewed upon expiry, filed an application with the Labor Relations Commission for a remedy for unfair dismissal. The Jeonnam Regional Labor Relations Commission examined the contents of the employment contract, the existence of work rules, the nature of the performance evaluation, and the presence or absence of any renewal practice, and on that basis determined whether the case constituted unfair dismissal. This article reviews the Commission’s reasoning structure and, from the practical perspective of Labor Law Firm Law&, organizes the legal principles on renewal expectation rights.
Ⅱ. Issues
The issue in this case is whether, “where only the contract period is specified in the employment contract and there are no work rules or renewal criteria, the employer’s decision not to renew the contract after expiry of the term constitutes unfair dismissal.” In other words, the core question is whether, despite the formal characterization as a fixed-term contract, the employee can be recognized as having a “legitimate expectation of renewal” to continue working.
Ⅲ. Summary of the Labor Relations Commission’s Reasoning
The decision panel in this case noted that: (i) the employment contract stated only the commencement and termination dates of the contract period and contained no provision whatsoever that the contract would be renewed upon satisfaction of certain conditions; (ii) there were no work rules applicable to the employee, and thus no internal regulations setting out renewal conditions or procedures; (iii) the performance evaluation conducted by the employer in February 2026 was for the purpose of setting criteria for performance-based bonuses, not for determining whether to renew the contract; and (iv) there had been no instances of contract renewal for the employees first hired in the business, so no practice akin to “repeated renewal” or “automatic renewal” had been established.
In light of the employment contract, internal regulations, and actual operational practices taken together, the Commission found it difficult to conclude that a relationship of trust had been formed to the effect that “the contract will be renewed if certain conditions are met,” i.e., that a renewal expectation right had been established. The termination in this case was therefore regarded as an automatic termination upon expiry of the contract term, and it was held not to constitute unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
From the employee’s standpoint, if the employment contract merely specifies the contract period and there are no concrete renewal conditions set out in work rules, collective agreements, or HR guidelines, then statements such as “if you work hard, we’ll keep you on,” or one or two short-term renewals alone will generally not suffice to establish a renewal expectation right. On the premise that, unlike redundancy or ordinary dismissal, simple expiry of a fixed-term contract is in principle not considered a dismissal, an employee who wishes to assert a renewal expectation right should, in advance, collect objective evidence such as repeated renewals, explicit renewal provisions, or a consistent renewal practice for comparable employees.
Ⅴ. Practical Points (From the Employer’s/Company’s Perspective)
From the company’s perspective, when using fixed-term employment contracts, it is helpful for dispute prevention to clearly state in the employment contract that “the contract will automatically terminate upon expiry of the contract period without any further action,” and to specify in the work rules or HR guidelines that renewal is a matter of discretionary judgment. In addition, even when conducting performance evaluations, the company should clearly distinguish in writing whether the purpose is to calculate performance-based bonuses or to decide on renewal, in order to reduce unnecessary disputes over renewal expectation rights.
To prevail in this type of case, it is essential to accurately understand the legal principles on renewal expectation rights established by the Supreme Court and the Labor Relations Commissions, and to systematically organize and present to the Commission the relevant facts, including the wording of the employment contract, the existence of work rules, the purpose of performance evaluations, and actual renewal practices.
2. Matters Determined
A. Case Overview and Procedural History
Considering that: (i) the “employment contract” specified only the start and end dates of the contract period, and no provision could be found to the effect that the employment contract would be renewed upon satisfaction of certain conditions even after expiry of the term; (ii) there were no work rules applicable to the employees; (iii) the performance evaluation conducted by the employer in February 2026 was for the purpose of setting criteria for payment of performance-based bonuses; and (iv) as the employees first hired in the business had never had their contracts renewed, there was no renewal practice in place, it can be concluded that the employment contract entered into by the parties did not contain any provision to the effect that the employment contract would be renewed upon satisfaction of certain conditions, and…
3. Gist of the Decision
A. Summary of the Labor Relations Commission’s Reasoning
Considering that: (i) the “employment contract” specified only the start and end dates of the contract period, and no provision could be found to the effect that the employment contract would be renewed upon satisfaction of certain conditions even after expiry of the term; (ii) there were no work rules applicable to the employees; (iii) the performance evaluation conducted by the employer in February 2026 was for the purpose of setting criteria for payment of performance-based bonuses; and (iv) as the employees first hired in the business had never had their contracts renewed, there was no renewal practice in place, it can be concluded that the employment contract entered into by the parties did not contain any provision to the effect that the employment contract would be renewed upon satisfaction of certain conditions, and… /
[Further Related Decisions]
- “Unfair Dismissal Decision on Probationary Dismissal (Change in Probation Evaluation)”
- “Unfair Dismissal Decision on Expression of Intention to Resign (Resignation Remark in Telephone Call)”
- “Unfair Dismissal Decision on Non-Formation of Hiring Commitment (Absence of Offer Letter)” – Date of decision: – Case result: First-instance decision upheld
[Tags]
Unfair dismissal, non-existence of renewal expectation right (performance evaluation · absence of work rules), 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 the “Unfair Dismissal Decisions” series by Labor Law Firm Law&.
※ You can view the previous article, “Unfair Dismissal Decision on Probationary Dismissal (Change in Probation Evaluation),” in a new window.
※ The list of decisions related to non-existence of renewal expectation right (performance evaluation · absence of work rules) can be viewed together in the “List of Decisions on Non-Existence of Renewal Expectation Right (Performance Evaluation · Absence of Work Rules).”
※ Korean version of this case: Korean article
