One Law Partners, LLC represented the employer in an unfair dismissal remedy application filed by a fixed-term employee against a public institution and successfully secured dismissal decisions at both the Regional Labor Relations Commission and the National Labor Relations Commission by establishing that there were reasonable grounds for refusing to renew the employment contract.

1. Overview of the Matter

The client, Company B, is a public institution responsible for carrying out public projects. Following the completion of its principal projects and an organizational restructuring, Company B reduced its workforce and hired fixed-term employees to handle remaining operational tasks.

The applicant, A, had worked for Company B for an extended period before retiring at the mandatory retirement age. Thereafter, A performed workplace management services at Company B as an employee of an external contractor before entering into a direct fixed-term employment contract with Company B.

A served as a management supervisor at the same workplace and renewed the employment contract several times. Upon the expiration of the final contract term, however, Company B terminated the employment relationship in accordance with the contract.

A argued that a legitimate expectation of renewal had arisen due to the repeated renewals and continued performance of the same duties, and that Company B had refused to renew the contract without just cause.

In particular, A alleged that Company B had conducted a targeted audit to replace A with a specific successor and had pressured A to resign. Based on these allegations, A filed an unfair dismissal remedy application with the Regional Labor Relations Commission and sought monetary compensation in lieu of reinstatement.

One Law Partners, LLC represented Company B in the initial proceedings and continued to represent the company in the appellate proceedings before the National Labor Relations Commission after A challenged the Regional Labor Relations Commission’s decision dismissing the application.

2. Key Issues

The first issue was whether the fixed-term employee had acquired a legitimate expectation of renewal.

Although a fixed-term employment contract generally terminates upon expiration of its term, a legitimate expectation of renewal may arise where the circumstances surrounding the contract, repeated renewal practices, and continuity of duties collectively create a reasonable expectation that the contract will be renewed.

In this case, key considerations included the period during which A worked for an external contractor, the period of direct employment with Company B, the repeated renewals of the contract, and whether A continued to perform substantially the same duties.

The second issue was whether there were reasonable grounds for the employer’s refusal to renew the contract, even if a legitimate expectation of renewal existed.

Company B conducted an audit after identifying issues relating to expense management and contract administration at the workplace where A served as the person responsible for management.

Accordingly, the central issues were whether the audit was conducted for legitimate business purposes, whether the issues identified during the audit constituted reasonable grounds for refusing renewal, and whether A’s allegations of forced resignation and improper personnel intervention were supported by evidence.

3. Key Strategies and Actions

One Law Partners first analyzed the background of Company B’s organizational restructuring and its hiring of fixed-term employees and reviewed the employment contract, job posting materials, and internal personnel regulations to clarify the parties’ agreement regarding the contract term and renewal procedures.

In particular, the firm argued that A did not possess a legitimate expectation of renewal because the employment contract had been entered into on a temporary basis in circumstances where the continued existence of the organization and the ongoing need for the relevant duties were uncertain following the completion of Company B’s major projects.

In addition, the firm developed a separate and central defense argument that even if a legitimate expectation of renewal were recognized, there were reasonable grounds for refusing to renew the contract.

One Law Partners submitted audit reports, contract-related documentation, witness statements, and interview records to demonstrate that Company B’s audit was a legitimate procedure undertaken to investigate specific issues relating to expense management and contract administration.

The firm also emphasized that matters such as the execution of a private contract with an individual responsible for workplace security services and the performance of separate service work during working hours were directly related to the managerial responsibilities of the workplace supervisor.

Furthermore, One Law Partners rebutted A’s allegations of a targeted audit, pressure to resign, and improper personnel intervention aimed at hiring a particular successor by presenting objective evidence and the relevant factual circumstances.

As a result, the Regional Labor Relations Commission found that, while A’s repeated contract renewals and the continuity of duties gave rise to a legitimate expectation of renewal, Company B had reasonable grounds for refusing renewal and the allegations of a targeted audit and coercive pressure to resign were not supported by the evidence. The Commission therefore dismissed A’s application for relief.

A subsequently appealed the decision to the National Labor Relations Commission. However, the National Labor Relations Commission likewise concluded that, irrespective of whether A possessed a legitimate expectation of renewal, reasonable grounds existed for refusing renewal.

In particular, the National Labor Relations Commission found that the private contract entered into with the individual responsible for workplace security services posed a significant risk of violating conflict-of-interest prevention laws and internal codes of conduct, and that the performance of separate service work during working hours could not be regarded as a minor issue.

The Commission further determined that there was insufficient objective evidence to support A’s allegations of forced resignation or improper personnel intervention and upheld the initial decision, dismissing A’s appeal in its entirety.

4. Significance of the Matter

This case demonstrates that even where a fixed-term employee possesses a legitimate expectation of renewal arising from repeated contract renewals, termination of the employment relationship may still be deemed lawful if the employer can establish objective and reasonable grounds for refusing further renewal.

Notably, One Law Partners did not rely solely on disputing the existence of a legitimate expectation of renewal. Instead, the firm adopted a comprehensive strategy that addressed both the renewal expectation issue and the reasonableness of the decision not to renew the contract.

By securing objective evidence concerning the audit process and the employee’s managerial responsibilities and effectively rebutting allegations of a targeted audit and forced resignation, the firm obtained favorable decisions for the employer before both the Regional Labor Relations Commission and the National Labor Relations Commission.

This case is significant as an example of consecutive victories at both the initial and appellate levels, achieved by demonstrating the objectivity and reasonableness of the grounds for non-renewal even in circumstances where a legitimate expectation of contract renewal was recognized. It provides important practical guidance for employers facing disputes involving the renewal of fixed-term employment contracts.


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Ok-Ja Jeong, Attorney | ojjeong@onelawpartners.com
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Public Relations Team, One Law Partners, LLC | pr@onelawpartners.com