On December 7, 2023, the Supreme Court of Korea issued its first-ever ruling1 regarding the country’s 12-hour-overtime limit under Article 53(1) of the Labor Standards Act (LSA). The Supreme Court clarified that the 12-hour overtime limit under Article 53(1) shall be calculated against an employee’s hours worked in excess of 40 hours per week, irrespective of whether the employee’s daily overtime hours (hours worked in excess of 8 hours per day) total more than 12 hours per week.
I. Provisions of the Labor Standards Act2
The pertinent provisions of the LSA are as follows:
II. Procedural History
A. First Trial
The defendant, a CEO of an aircraft cabin cleaning company, was charged with the criminal offense of violating Article 53(1), which prohibits employers from allowing their employees to work more than 12 hours of overtime per week.3 The first-level trial court found that the defendant violated Article 53(1) by focusing on whether daily overtime hours (hours worked beyond 8 hours per day as specified in Article 50(2)) total more than 12 hours per week, irrespective of whether weekly overtime hours (hours worked beyond 40 hours per week as specified in Article 50(1)) exceed 12 hours.
This interpretation aligns with the previous administrative interpretation of Article 53(1) by the Ministry of Employment and Labor (MOEL) published on May 18, 2018.4 In this interpretation, the MOEL found that if an employee works 15 hours per day for three days a week and does not work the rest of the week (resulting in a total of 45 hours in a workweek), it would still be a violation of Article 53(1) because the daily overtime hours in a week total 21 hours (7+7+7), exceeding the 12-hour-overtime limit under Article 53(1).
B. Second Trial
The defendant appealed to the second-level trial court. On October 19, 2020, the second-level trial court also found that the defendant violated Article 53(1) and dismissed the appeal. Subsequently, the defendant appealed to the Supreme Court.
C. Supreme Court’s Ruling
On December 7, 2023, the Supreme Court overturned the second-level trial court’s interpretation of Article 53(1) and remanded the case to the second-level trial court for a decision consistent with its ruling. The Supreme Court ruled that, as long as an employee works less than or equal to 12 overtime hours per week (or 52 work hours per week), there is no violation of Article 53(1), regardless of whether daily overtime hours (hours worked beyond 8 hours per day) total more than 12 hours per week.
In reaching this conclusion, the Supreme Court explained its rationale as follows: (i) as Article 53(1) sets a 12-hour-overtime limit on weekly overtime work, interpreting unlawful weekly overtime work in this context shall be based on 40 work hours per week under Article 50(1) and shall not be based on 8 work hours per day under Article 50(2); (ii) in other words, the 12-hour overtime limit under Article 53(1) shall be calculated against an employee’s hours worked in excess of 40 hours per week; and (iii) Article 53(1)’s reference to Article 50(2) shall be interpreted to mean merely that work hours exceeding 8 hours is permissible by agreement, rather than implying a separate mandate on the limit of daily overtime work.
Thus, pursuant to the Supreme Court’s interpretation, working 15 hours per day for three days a week (resulting in a total of 45 hours of work per week) shall not violate Article 53(1) because the total weekly overtime hours, calculated by subtracting the standard 40-hour workweek from the total 45 hours of work per week, come out to just 5 hours, which falls below the 12-hour-overtime limit under Article 53(1).
In its dicta related to Article 56(1), the Supreme Court further articulated the following points: (i) Article 56(1)—which mandates employers to pay an additional 50% or more of the ordinary wage for both daily overtime work (hours worked beyond 8 hours per day) and weekly overtime work (hours worked beyond 40 hours per week)—serves to discourage overtime work by imposing a financial burden on employers and to ensure appropriate financial compensation to employees, rather than to prohibit overtime work; (ii) in contrast, Article 53(1) serves to prohibit overtime work exceeding 12 hours per week even with the consent of the parties; and (ii) therefore, the criteria for determining overtime work entitled for overtime compensation under Article 56(1) and the criteria for determining illegal overtime work under Article 53(1) are not necessarily the same.
III. Ramifications of the Supreme Court’s Decision
The Supreme Court’s ruling clarified that, in determining the illegality of overtime work under Article 53(1), trial courts should assess only the weekly overtime hours (hours worked beyond 40 hours per week) without considering the daily overtime hours (hours worked beyond 8 hours per day). The Supreme Court further clarified that its ruling does not affect the computation for overtime compensation under Article 56(1).
On January 22, 2023, the MOEL revised its administrative interpretation of Article 53(1) consistent with the Supreme Court’s ruling. The responses have been mixed. Labor activists, including The Federation of Korean Trade Unions and The Korean Confederation of Trade Unions, have strongly protested the ruling, urging the government to step-in to set daily maximum work hours.5 In contrast, business circles, including the Korea Enterprises Federation, have mostly welcomed the ruling as a necessary step to more flexible management of work hours.6
The key takeaway for employers in Korea with 30 or more7 employees: Employers are now legally permitted to authorize their employees to work up to 24 hours8 per day as long as such employees work less than or equal to 52 hours per week, but employers still must consider both daily overtime work (hours worked beyond 8 hours per day) and weekly overtime work (hours worked beyond 40 hours per week) in the computation for overtime compensation. For more information about the Supreme Court’s decision or for any questions, feel free to contact the authors.
I. Provisions of the Labor Standards Act2
The pertinent provisions of the LSA are as follows:
Article 50 (Work Hours)
(1) Work hours shall not exceed 40 hours a week, excluding hours of recess.
(2) Work hours shall not exceed 8 hours a day, excluding hours of recess.
Article 53 (Restrictions on Extended Work)
(1) Where an agreement is made between the parties, work hours referred to in Article 50 may be extended by up to 12 hours per week.
Article 56 (Extended, Night or Holiday Work)
(1) An employer shall, in addition to the ordinary wages, pay at least 50/100 thereof for extended work (referring to the work during the hours extended pursuant to Articles 53 and 59 and to the proviso of Article 69).
Article 110 (Criminal Provisions)
Any of the following persons shall be punished by imprisonment for not more than two years or by a fine not exceeding KRW 20 million:
1. A person who violates Articles 10, 22 (1), 26, 50, 51-2 (2), 52 (2) 1, 53 (1), (2) and the main clause of paragraphs (4) and (7), 54, 55, 59 (2), 60 (1), (2), (4) and (5), 64 (1), 69, 70 (1) and (2), 71, 74 (1) through (5), 75, 78 through 80, 82, 83 and 104 (2)
(1) Work hours shall not exceed 40 hours a week, excluding hours of recess.
(2) Work hours shall not exceed 8 hours a day, excluding hours of recess.
Article 53 (Restrictions on Extended Work)
(1) Where an agreement is made between the parties, work hours referred to in Article 50 may be extended by up to 12 hours per week.
Article 56 (Extended, Night or Holiday Work)
(1) An employer shall, in addition to the ordinary wages, pay at least 50/100 thereof for extended work (referring to the work during the hours extended pursuant to Articles 53 and 59 and to the proviso of Article 69).
Article 110 (Criminal Provisions)
Any of the following persons shall be punished by imprisonment for not more than two years or by a fine not exceeding KRW 20 million:
1. A person who violates Articles 10, 22 (1), 26, 50, 51-2 (2), 52 (2) 1, 53 (1), (2) and the main clause of paragraphs (4) and (7), 54, 55, 59 (2), 60 (1), (2), (4) and (5), 64 (1), 69, 70 (1) and (2), 71, 74 (1) through (5), 75, 78 through 80, 82, 83 and 104 (2)
II. Procedural History
A. First Trial
The defendant, a CEO of an aircraft cabin cleaning company, was charged with the criminal offense of violating Article 53(1), which prohibits employers from allowing their employees to work more than 12 hours of overtime per week.3 The first-level trial court found that the defendant violated Article 53(1) by focusing on whether daily overtime hours (hours worked beyond 8 hours per day as specified in Article 50(2)) total more than 12 hours per week, irrespective of whether weekly overtime hours (hours worked beyond 40 hours per week as specified in Article 50(1)) exceed 12 hours.
This interpretation aligns with the previous administrative interpretation of Article 53(1) by the Ministry of Employment and Labor (MOEL) published on May 18, 2018.4 In this interpretation, the MOEL found that if an employee works 15 hours per day for three days a week and does not work the rest of the week (resulting in a total of 45 hours in a workweek), it would still be a violation of Article 53(1) because the daily overtime hours in a week total 21 hours (7+7+7), exceeding the 12-hour-overtime limit under Article 53(1).
B. Second Trial
The defendant appealed to the second-level trial court. On October 19, 2020, the second-level trial court also found that the defendant violated Article 53(1) and dismissed the appeal. Subsequently, the defendant appealed to the Supreme Court.
C. Supreme Court’s Ruling
On December 7, 2023, the Supreme Court overturned the second-level trial court’s interpretation of Article 53(1) and remanded the case to the second-level trial court for a decision consistent with its ruling. The Supreme Court ruled that, as long as an employee works less than or equal to 12 overtime hours per week (or 52 work hours per week), there is no violation of Article 53(1), regardless of whether daily overtime hours (hours worked beyond 8 hours per day) total more than 12 hours per week.
In reaching this conclusion, the Supreme Court explained its rationale as follows: (i) as Article 53(1) sets a 12-hour-overtime limit on weekly overtime work, interpreting unlawful weekly overtime work in this context shall be based on 40 work hours per week under Article 50(1) and shall not be based on 8 work hours per day under Article 50(2); (ii) in other words, the 12-hour overtime limit under Article 53(1) shall be calculated against an employee’s hours worked in excess of 40 hours per week; and (iii) Article 53(1)’s reference to Article 50(2) shall be interpreted to mean merely that work hours exceeding 8 hours is permissible by agreement, rather than implying a separate mandate on the limit of daily overtime work.
Thus, pursuant to the Supreme Court’s interpretation, working 15 hours per day for three days a week (resulting in a total of 45 hours of work per week) shall not violate Article 53(1) because the total weekly overtime hours, calculated by subtracting the standard 40-hour workweek from the total 45 hours of work per week, come out to just 5 hours, which falls below the 12-hour-overtime limit under Article 53(1).
In its dicta related to Article 56(1), the Supreme Court further articulated the following points: (i) Article 56(1)—which mandates employers to pay an additional 50% or more of the ordinary wage for both daily overtime work (hours worked beyond 8 hours per day) and weekly overtime work (hours worked beyond 40 hours per week)—serves to discourage overtime work by imposing a financial burden on employers and to ensure appropriate financial compensation to employees, rather than to prohibit overtime work; (ii) in contrast, Article 53(1) serves to prohibit overtime work exceeding 12 hours per week even with the consent of the parties; and (ii) therefore, the criteria for determining overtime work entitled for overtime compensation under Article 56(1) and the criteria for determining illegal overtime work under Article 53(1) are not necessarily the same.
III. Ramifications of the Supreme Court’s Decision
The Supreme Court’s ruling clarified that, in determining the illegality of overtime work under Article 53(1), trial courts should assess only the weekly overtime hours (hours worked beyond 40 hours per week) without considering the daily overtime hours (hours worked beyond 8 hours per day). The Supreme Court further clarified that its ruling does not affect the computation for overtime compensation under Article 56(1).
On January 22, 2023, the MOEL revised its administrative interpretation of Article 53(1) consistent with the Supreme Court’s ruling. The responses have been mixed. Labor activists, including The Federation of Korean Trade Unions and The Korean Confederation of Trade Unions, have strongly protested the ruling, urging the government to step-in to set daily maximum work hours.5 In contrast, business circles, including the Korea Enterprises Federation, have mostly welcomed the ruling as a necessary step to more flexible management of work hours.6
The key takeaway for employers in Korea with 30 or more7 employees: Employers are now legally permitted to authorize their employees to work up to 24 hours8 per day as long as such employees work less than or equal to 52 hours per week, but employers still must consider both daily overtime work (hours worked beyond 8 hours per day) and weekly overtime work (hours worked beyond 40 hours per week) in the computation for overtime compensation. For more information about the Supreme Court’s decision or for any questions, feel free to contact the authors.
1 Supreme Court Decision 2020Do15393 (December 7, 2023)
2 English translation of original text in Korean.
3 The violation of Article 53(1) can be punished by imprisonment for not more than two years or a fine of not exceeding KRW 20 million under Article 110(1).
4 Press Release, Ministry of Employment and Labor (May. 18, 2018), Explanation Material on the Revised Labor Standards Act, https://www.moel.go.kr/news/enews/report/enewsView.do?news_seq=16103.
5 Hae-rin Lee, Labor activists protest Supreme Court overtime ruling, THE KOREA TIMES, December 28, 2023.
6 Id.
7 For employers in Korea with less than 30 employees, the MOEL extended the grace period for implementing the 52-hour workweek system until December 31, 2024, allowing smaller businesses more time to comply with the regulations. Press Release, Ministry of Employment and Labor (Jan. 22, 2024), Extension of Grace Period for Implementation of 52-Hour Workweek for Entities with Less than 30 Employees, https://www.moel.go.kr/news/enews/report/enewsView.do?news_seq=16033.
8 According to the previous administrative interpretation of the 12-hour-overtime limit under Article 53(1) of the LSA published by MOEL, employers would be in violation of Article 53(1) if they authorize their employees to work more than 20 hours per day, which is calculated as the standard 8-hour work per day plus 12-hour overtime limit.
2 English translation of original text in Korean.
3 The violation of Article 53(1) can be punished by imprisonment for not more than two years or a fine of not exceeding KRW 20 million under Article 110(1).
4 Press Release, Ministry of Employment and Labor (May. 18, 2018), Explanation Material on the Revised Labor Standards Act, https://www.moel.go.kr/news/enews/report/enewsView.do?news_seq=16103.
5 Hae-rin Lee, Labor activists protest Supreme Court overtime ruling, THE KOREA TIMES, December 28, 2023.
6 Id.
7 For employers in Korea with less than 30 employees, the MOEL extended the grace period for implementing the 52-hour workweek system until December 31, 2024, allowing smaller businesses more time to comply with the regulations. Press Release, Ministry of Employment and Labor (Jan. 22, 2024), Extension of Grace Period for Implementation of 52-Hour Workweek for Entities with Less than 30 Employees, https://www.moel.go.kr/news/enews/report/enewsView.do?news_seq=16033.
8 According to the previous administrative interpretation of the 12-hour-overtime limit under Article 53(1) of the LSA published by MOEL, employers would be in violation of Article 53(1) if they authorize their employees to work more than 20 hours per day, which is calculated as the standard 8-hour work per day plus 12-hour overtime limit.
