a. New or Expected Developments
There are two significant issues expected to arise in 2018. One is the expiry of the 3 year period which is the cap for worker dispatch, implemented on October 1, 2015, meaning that workplaces which accept dispatched workers who are not employed permanently by their dispatching agency can no longer continue working at the same client, unless they are employed on an open end basis by the dispatching agency.
The second is the impact of the revision to the Labor Contract Act implemented on April 1, 2013, which changed the rules concerning fixed term employment so that when fixed term employment which started on or after April 1, 2013, is renewed, and the aggregate period exceeds 5 years, the fixed term employee can seek open end agreement with their employer (there are a few exceptions to this rule, such as reemployment of persons over age 60). This means that the earliest timing in which the 5 year period starting from April 1, 2013 will be exceeded will be April 1, 2018.
Since many dispatched workers are employed as fixed term employees, there is a possibility that worker dispatch companies may refuse renewal of fixed term contracts before reaching a 5 year aggregate period, particularly since the worker dispatch company will need to find a new client to send the dispatched worker to after they continue to work for the same client in the same position. This will likely lead to many disputes where the validity of non-renewal of fixed term employment right before reaching the 5 year period is valid as year 2018 nears.
b. Recent Amendments to the Law
As explained above, this area of law has seen significant amendments in recent years, to promote permanent and direct employment, and restrict temporary use of labor service, as seen from the amendment to the Worker Dispatch Act which restricts worker dispatch to a maximum period of 3 years for the same individual to be dispatched for the same position, unless that worker is employed by the worker dispatch company. This provides employment security for the dispatched worker, since it had been common for worker dispatch companies to employ dispatched workers for fixed periods, and only for periods when there is a client to send the worker (so if the worker dispatch company did not have a client to send the worker, they do not have to keep employing, and paying the salary for, the worker), and this amendment promotes worker dispatch companies to employ dispatched workers on an open end basis, meaning the worker will still be employed during gap periods when there is no client to be sent to.