Corporate trends / Performance record
Unfair Dismissal Decision on “Interpretation of Contract Term (Automatic Renewal for Daily Workers)” (Unfair Dismissal 621)
- Date2026/08/14 04:06
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[Case Information]
This case is an unfair dismissal decision concerning the issue of “interpretation of contract term (automatic renewal for daily workers),” in which the employer ultimately prevailed (application dismissed).
Decision body: Jeonnam Regional Labor Relations Commission 2026Buhae513 ○ ○ ○ Application for Remedy for Unfair Dismissal
2026-07-08 · Case outcome: Dismissed
Summary of key issue: As to the employment contract term set out in the employment contracts executed between the workers and the employer, the parties clearly stated that their employment relationship was that of daily employment. However, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without going through a separate contract-execution procedure. Accordingly, the workers were hired as daily workers, and the employment relationship between the parties came to an end upon expiry of the daily employment contract…
1. Legal Implications
Ⅰ. Case Overview
In this unfair dismissal case before the Labor Relations Commission, the issue was whether, where the employment contract specifies the worker as a daily employee but there is an established practice of automatic renewal on a one‑month basis without separate written contracts, the expiry of the contract term can be regarded as a dismissal.
The Jeonnam Regional Labor Relations Commission examined both the wording of the employment contracts executed between the workers and the employer and the actual manner in which they were operated, in order to determine the legal nature of the termination of the employment relationship.
Ⅱ. Summary of Issues
The issue in this case is:
“Where the employment contract expressly provides for daily or fixed‑term employment and there is a practice of automatic renewal on a monthly basis, can the expiry of the contract term be regarded as an unfair dismissal by the employer?”
Ⅲ. Summary of the Labor Relations Commission’s Findings
The panel in this case noted that the parties clearly stated in the employment contracts that the form of employment was a “daily employment contract relationship,” and that, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without any separate written procedure. The panel further found that this agreement merely regulated the practical method of renewal and could not readily be interpreted as a clause converting the workers into permanent employees with no fixed term or guaranteeing renewal.
Accordingly, the workers must be regarded as having been hired as daily workers, and the employment relationship between the parties must be deemed to have terminated upon expiry of the agreed daily employment contract term.
The panel therefore found that no dismissal existed in this case and dismissed the application for remedy for unfair dismissal.
Ⅳ. Practical Points (From the Worker’s Perspective)
Where the employment contract expressly includes wording such as “daily worker,” “fixed‑term,” or “automatic termination upon expiry of the contract term,” you should be aware that the mere fact of repeated renewals does not, by itself, automatically convert the contract into an indefinite‑term employment contract.
However, you should carefully examine whether, in light of various circumstances—such as whether the contract was renewed repeatedly over a long period, whether the company in fact assigned you to regular and continuous work, and whether there were almost no cases of renewal being refused—there is room to recognize a “legitimate expectation of continued employment.”
If you intend to allege unfair dismissal in a similar situation, you should go beyond the bare wording of the contract and specifically organize and submit to the Labor Relations Commission materials such as your actual period of service, the number of renewals, the renewal practices applicable to comparable workers, and whether there are any provisions on renewal in the work rules or collective agreements.
Ⅴ. Practical Points (From the Employer/Company’s Perspective)
As shown in this decision, if the employment contract clearly states that the employment is daily or fixed‑term, and it is made explicit that the employment relationship will automatically terminate upon expiry of the contract term, then, in principle, termination of the employment relationship due to expiry of the term is highly likely to be evaluated as contract expiry rather than dismissal.
However, where short‑term contracts are renewed repeatedly over a long period, issues are likely to arise as to whether the contract term is merely “formal” and whether a legitimate expectation of renewal has been formed. You should therefore manage in writing your criteria for renewal, evaluation procedures, and cases of renewal refusal, so that you can demonstrate that the exercise of your personnel authority remained within the bounds of reasonable discretion.
In addition, if you use expressions that cause workers to expect job security equivalent to that of permanent employees (for example, everyday remarks such as “as long as nothing special happens, we’ll keep working together,” or internal guidelines that in effect guarantee renewal), such expressions may later be used as evidence to recognize an expectation of renewal in an unfair dismissal dispute. It is therefore advisable to consult with a specialized organization such as Labor Law Firm Law& to review and refine your contract wording and operational practices.
2. Matters Decided
A. Case Overview and Procedural History
As to the employment contract term set out in the employment contracts executed between the workers and the employer, the parties clearly stated that their employment relationship was that of a daily employment contract. However, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without going through a separate contract‑execution procedure. Accordingly, the workers were hired as daily workers, and the employment relationship between the parties came to an end upon expiry of the daily employment contract, so that no dismissal existed.
3. Summary of the Decision
A. Summary of the Labor Relations Commission’s Findings
As to the employment contract term set out in the employment contracts executed between the workers and the employer, the parties clearly stated that their employment relationship was that of a daily employment contract. However, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without going through a separate contract‑execution procedure. Accordingly, the workers were hired as daily workers, and the employment relationship between the parties came to an end upon expiry of the daily employment contract, so that no dismissal existed. /
[Further Related Decisions]
- “‘Failure to Form Hiring Commitment (Absence of Offer Letter)’ Unfair Dismissal Decision” – Date of decision: – Case outcome: First‑instance decision upheld
- “‘Expression of Intention to Resign (Resignation Remark Made by Telephone)’ Unfair Dismissal Decision”
- “‘Failure to Satisfy Requirements for Redundancy Dismissal (Workout Company)’ Unfair Dismissal Decision”
[Tags]
Unfair dismissal, interpretation of contract term (automatic renewal for daily workers), 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, “‘Employee Status · Expectation of Renewal (Construction Daily Worker)’ Unfair Dismissal Decision,” in a new window.
※ A list of decisions related to interpretation of contract term (automatic renewal for daily workers) can be found under “List of Decisions Related to Interpretation of Contract Term (Automatic Renewal for Daily Workers).”
※ Korean version of this case: Korean article
This case is an unfair dismissal decision concerning the issue of “interpretation of contract term (automatic renewal for daily workers),” in which the employer ultimately prevailed (application dismissed).
Decision body: Jeonnam Regional Labor Relations Commission 2026Buhae513 ○ ○ ○ Application for Remedy for Unfair Dismissal
2026-07-08 · Case outcome: Dismissed
Summary of key issue: As to the employment contract term set out in the employment contracts executed between the workers and the employer, the parties clearly stated that their employment relationship was that of daily employment. However, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without going through a separate contract-execution procedure. Accordingly, the workers were hired as daily workers, and the employment relationship between the parties came to an end upon expiry of the daily employment contract…
1. Legal Implications
Ⅰ. Case Overview
In this unfair dismissal case before the Labor Relations Commission, the issue was whether, where the employment contract specifies the worker as a daily employee but there is an established practice of automatic renewal on a one‑month basis without separate written contracts, the expiry of the contract term can be regarded as a dismissal.
The Jeonnam Regional Labor Relations Commission examined both the wording of the employment contracts executed between the workers and the employer and the actual manner in which they were operated, in order to determine the legal nature of the termination of the employment relationship.
Ⅱ. Summary of Issues
The issue in this case is:
“Where the employment contract expressly provides for daily or fixed‑term employment and there is a practice of automatic renewal on a monthly basis, can the expiry of the contract term be regarded as an unfair dismissal by the employer?”
Ⅲ. Summary of the Labor Relations Commission’s Findings
The panel in this case noted that the parties clearly stated in the employment contracts that the form of employment was a “daily employment contract relationship,” and that, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without any separate written procedure. The panel further found that this agreement merely regulated the practical method of renewal and could not readily be interpreted as a clause converting the workers into permanent employees with no fixed term or guaranteeing renewal.
Accordingly, the workers must be regarded as having been hired as daily workers, and the employment relationship between the parties must be deemed to have terminated upon expiry of the agreed daily employment contract term.
The panel therefore found that no dismissal existed in this case and dismissed the application for remedy for unfair dismissal.
Ⅳ. Practical Points (From the Worker’s Perspective)
Where the employment contract expressly includes wording such as “daily worker,” “fixed‑term,” or “automatic termination upon expiry of the contract term,” you should be aware that the mere fact of repeated renewals does not, by itself, automatically convert the contract into an indefinite‑term employment contract.
However, you should carefully examine whether, in light of various circumstances—such as whether the contract was renewed repeatedly over a long period, whether the company in fact assigned you to regular and continuous work, and whether there were almost no cases of renewal being refused—there is room to recognize a “legitimate expectation of continued employment.”
If you intend to allege unfair dismissal in a similar situation, you should go beyond the bare wording of the contract and specifically organize and submit to the Labor Relations Commission materials such as your actual period of service, the number of renewals, the renewal practices applicable to comparable workers, and whether there are any provisions on renewal in the work rules or collective agreements.
Ⅴ. Practical Points (From the Employer/Company’s Perspective)
As shown in this decision, if the employment contract clearly states that the employment is daily or fixed‑term, and it is made explicit that the employment relationship will automatically terminate upon expiry of the contract term, then, in principle, termination of the employment relationship due to expiry of the term is highly likely to be evaluated as contract expiry rather than dismissal.
However, where short‑term contracts are renewed repeatedly over a long period, issues are likely to arise as to whether the contract term is merely “formal” and whether a legitimate expectation of renewal has been formed. You should therefore manage in writing your criteria for renewal, evaluation procedures, and cases of renewal refusal, so that you can demonstrate that the exercise of your personnel authority remained within the bounds of reasonable discretion.
In addition, if you use expressions that cause workers to expect job security equivalent to that of permanent employees (for example, everyday remarks such as “as long as nothing special happens, we’ll keep working together,” or internal guidelines that in effect guarantee renewal), such expressions may later be used as evidence to recognize an expectation of renewal in an unfair dismissal dispute. It is therefore advisable to consult with a specialized organization such as Labor Law Firm Law& to review and refine your contract wording and operational practices.
2. Matters Decided
A. Case Overview and Procedural History
As to the employment contract term set out in the employment contracts executed between the workers and the employer, the parties clearly stated that their employment relationship was that of a daily employment contract. However, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without going through a separate contract‑execution procedure. Accordingly, the workers were hired as daily workers, and the employment relationship between the parties came to an end upon expiry of the daily employment contract, so that no dismissal existed.
3. Summary of the Decision
A. Summary of the Labor Relations Commission’s Findings
As to the employment contract term set out in the employment contracts executed between the workers and the employer, the parties clearly stated that their employment relationship was that of a daily employment contract. However, for practical convenience, they agreed that, absent any change in working conditions or any separate objection, the employment contract would be deemed renewed for one month without going through a separate contract‑execution procedure. Accordingly, the workers were hired as daily workers, and the employment relationship between the parties came to an end upon expiry of the daily employment contract, so that no dismissal existed. /
[Further Related Decisions]
- “‘Failure to Form Hiring Commitment (Absence of Offer Letter)’ Unfair Dismissal Decision” – Date of decision: – Case outcome: First‑instance decision upheld
- “‘Expression of Intention to Resign (Resignation Remark Made by Telephone)’ Unfair Dismissal Decision”
- “‘Failure to Satisfy Requirements for Redundancy Dismissal (Workout Company)’ Unfair Dismissal Decision”
[Tags]
Unfair dismissal, interpretation of contract term (automatic renewal for daily workers), 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, “‘Employee Status · Expectation of Renewal (Construction Daily Worker)’ Unfair Dismissal Decision,” in a new window.
※ A list of decisions related to interpretation of contract term (automatic renewal for daily workers) can be found under “List of Decisions Related to Interpretation of Contract Term (Automatic Renewal for Daily Workers).”
※ Korean version of this case: Korean article
