Executive fired twice, reinstated twice before third dismissal
Company overhauled board vote to fix earlier procedural flaws
Court rejects both procedural and substantive challenges
A court has ruled that a financial institution was justified in dismissing a senior executive who verbally abused the company's auditor — telling him to "act your age" and calling him a "thieving bastard" — and then unilaterally shut down an audit meeting without cause. The court found that his conduct had fundamentally undermined organizational order and seriously damaged the workplace environment.
According to legal sources, the Gwangju District Court's 13th Civil Division, presided over by Judge Noh Jin-young, ruled against the plaintiff in early July in a lawsuit filed by former executive A, who had sought to have his dismissal declared invalid. A had demanded back pay of 100 million won ($73,000) per month from the date of his firing until reinstatement, but the court rejected the claim after finding the dismissal lawful.
Based on facts established during the proceedings, A had already been fired and reinstated twice between November 2022 and March 2023.
He had been found during a regular audit to have violated the company's code of ethics and improperly acquired business real estate, among other misconduct. A challenged both dismissals in court, and each time the court ruled the firings unlawful on procedural grounds — finding that board members with a duty to recuse themselves due to the risk of biased votes had nonetheless participated in the disciplinary proceedings.
Following those rulings, the company ordered A reinstated but simultaneously notified him that his duties were suspended, citing a pending disciplinary process.
The company held a board meeting last August and issued A a third notice of dismissal. This time, four of the seven directors deemed likely to vote unfairly recused themselves, and the remaining three voted unanimously to dismiss him.
A filed a third lawsuit challenging the dismissal in September last year, but his arguments were again rejected. During the trial, A's side argued that a vote by only three directors constituted a serious procedural defect, but the court dismissed the claim.
The court said it was reasonable to conclude that the board meeting had been conducted lawfully, noting that the four directors had recused themselves to comply with the recusal obligations established by the earlier rulings. It added that since all seven directors had been present at the start of the meeting — satisfying the quorum requirement of a majority — the board's resolution was valid.
The court also found that substantive grounds for discipline existed.
A was found to have attended an audit meeting in May 2022 despite not being an auditor and to have pushed his own views during the proceedings. In doing so, he directed abusive language at those present, including remarks such as "Do it properly — act your age" and "You're nothing but a thieving bastard." He then declared that those present "don't need to come to audits anymore" and announced the meeting was over, bringing it to an abrupt end.
He was also found to have improperly allowed auditors to participate in a vote during a by-election for an executive position. The court additionally recognized as grounds for discipline his repeated verbal abuse of other employees between 2021 and 2022.
A's side argued that he had no intention of disrupting or influencing the audit meeting or the board, and that his conduct had no effect on the outcome of any vote. The court rejected those claims, saying it was difficult to accept A's account as fact and that his behavior had caused disorder during the meeting and brought it to an actual halt.
The court said A's conduct "fundamentally undermined organizational order within the workplace and seriously damaged the working environment in and of itself," adding that it constituted a violation of the company's personnel regulations.
The court also found the severity of the disciplinary action appropriate, noting that A had previously received a reprimand for the same type of misconduct, including verbal abuse.
It concluded that "the degree of misconduct cannot be considered minor" and that "intent can also be recognized, and therefore the dismissal is consistent with internal disciplinary standards."
The ruling has not yet been finalized. A has appealed the first-instance decision, and the case is currently pending before the Gwangju High Court.
notstrong@heraldcorp.com
