How Will "Non-Work Activity Time" Be Calculated If the Comprehensive Wage System Is Abolished?

Interest Grows in Measuring Actual Working Hours

#1. One broadcasting company pays its production directors an additional overtime allowance, labeled as "production support funds," for up to 226 hours per month. Employees autonomously record and apply for their own overtime hours each month.

#2. A financial company that includes up to 30 hours of overtime in its base salary records employees' working hours through employee ID tagging. Recently, with discussions about abolishing the comprehensive wage system, there are calls for a new working hours management method that incorporates PC power-on records, as well as a comprehensive review of the overall salary structure.

Photo to aid understanding of the article. Pixabay.

With the anticipated abolition of the comprehensive wage system and the introduction of mandatory "actual working hours measurement and recording," the management standards for employees' personal activities during working hours (hereinafter referred to as "non-work activities") are also drawing attention. Since there is a possibility that overtime allowances may need to be paid based on actual working hours, countermeasures are required. Labor law experts advise that "the employer's actual direction and supervision" and "violation of the duty of good faith under the employment contract" are the key criteria, and that each case should be assessed individually based on these principles.

The current Labor Standards Act does not explicitly define "working hours." Time during which an employee is under the employer's direction and supervision is considered working hours, while time during which the employee is completely free from the employer's control and can use freely is considered break time. The Supreme Court determines "time under the employer's direction and supervision" as actual working hours, but states that each case should be assessed individually, taking into account the characteristics of the industry and the nature of the work.

In August 2020, the Supreme Court recognized as working hours the short breaks of 10 or 15 minutes given every two hours to production workers (2019Da14110). The Court found that, considering the size of the company's automobile production plant, the nature of the work, and the number of production workers receiving breaks simultaneously, there are fundamental limitations to using these short breaks freely. These breaks were deemed to be the minimum time necessary to take care of basic physiological needs or for stopping work and maintaining equipment for safety, health, and efficient production, and thus were considered waiting time for the next work period.

On the other hand, in June 2018, the Supreme Court ruled that the waiting time for bus drivers between the end of one route and the start of the next was not considered working hours (2013Da28926). The Court found no evidence that the plaintiffs were specifically directed or supervised during the waiting time, nor were there any provisions in the employment contract, work rules, or collective agreements indicating that the employer's direction and supervision extended to this waiting time. Although the waiting time was somewhat irregular, the departure times for the next bus routes were predetermined in the schedule, so there was no significant difficulty in using this time for rest.

While the employer's actual direction and supervision is the key criterion, more complex interpretations are required for office workers who work on-site. The courts have found that if non-work activities during working hours reach a level that violates the duty of good faith under the employment contract, and if such behavior is continuous and repetitive enough to affect work performance, then disciplinary action for personal activities during working hours is justified.

In November 2021, the Seoul High Court ruled that a one-month suspension imposed on an IT director who constantly accessed shopping, news, and social networking sites using company equipment and the internet during working hours was justified (2020Nu67515). The employee spent about two hours per day online, and there were 252 internet sites with more than 100 page views each. This ruling was finalized by the Supreme Court through a dismissal without hearing. While time under the employer's direction and supervision is generally considered working hours, if the frequency of personal activities is high and causes substantial disruption to work, disciplinary action is deemed legitimate.

Kwon Younghwan (age 46, 3rd bar exam), co-head of the labor group at Jipyung Law Firm, said, "Companies will face the burden of building new systems or reviewing their basic salary structures to thoroughly manage working hours, and for employees, there will likely be increased intervention in both working hours and the quality of work."

There are also suggestions that the employer's burden of proof regarding working hours may be strengthened. Lee Kwangsun (age 51, 35th Judicial Research and Training Institute), attorney at Yulchon LLC, said, "If the measurement and recording of actual working hours becomes mandatory by law, and an employee requests the court to order the submission of documents related to working hours, the employer will not be able to refuse to submit data such as computer logout times from the company server or records from email and KakaoTalk. As a result, the burden of proof regarding working hours could become much clearer."

Seo Hayoun, Legal Times Reporter

※This article is based on content supplied by Law Times.