A designated driver (Image courtesy of Pixabay)
SEOUL, Oct. 3 (Korea Bizwire) – In a landmark decision, South Korea’s Supreme Court has ruled that designated drivers can be classified as workers under the country’s labor union law, potentially opening the door for collective bargaining rights based on their employment status.
The ruling, handed down on September 27, marks the first time the nation’s highest court has recognized designated drivers’ eligibility for union membership. The case centered on a dispute between a designated driving company in Busan and one of its drivers.
The company had entered into a partnership agreement with its drivers, including the plaintiff, assigning customer requests through a smartphone application shared with other affiliated companies.
The driver in question joined the Busan Designated Driving Industry Labor Union in December 2018, which subsequently demanded collective bargaining with the company in early 2019.
Rejecting the union’s demands, the company argued that the drivers were independent contractors rather than employees, and filed a lawsuit seeking confirmation that the drivers did not have worker status under the labor union law.
The crux of the legal debate was whether designated drivers could be considered “workers” under the Trade Union and Labor Relations Adjustment Act, which defines workers more broadly than the Labor Standards Act.
The lower courts had ruled in favor of the driver, a decision now upheld by the Supreme Court after more than four years of deliberation.
In its ruling, the Supreme Court emphasized that the driver’s income was primarily dependent on fares received from customers assigned by the company and its affiliates, indicating a high degree of exclusivity in the working relationship.
Addressing the issue of drivers directly receiving payment from customers, the court stated, “This is due to the fact that only designated drivers can receive cash payments on-site, and it merely omits the process of the fare being first transferred to the plaintiff company before being paid to the defendant driver.”
The court also found evidence of a supervisory relationship, noting that the company unilaterally set commission rates, established operational guidelines, mandated training, and retained the right to terminate contracts for violations.
Furthermore, the court considered the long-term nature of the contractual relationship and the practical difficulty for drivers to operate independently without the company’s platform.
M. H. Lee (mhlee@koreabizwire.com)
