Hello, this is Attorney Choi Jong-ha of Cheongchul Law Firm.

For those who work under contracts with delivery agencies or designated-driver platforms, the first question they face when they are injured, when their contract is unilaterally terminated, or when their pay is withheld is: “Can I be recognized as an employee?” This is because the Labor Standards Act (근로기준법), which provides the strongest protection within Korea’s labor law system, ultimately applies only to ‘employees.’

In a case where a delivery worker affiliated with a delivery agency was injured during a delivery and the imposition of industrial accident insurance premiums was disputed, the Supreme Court held that the worker did not qualify as an employee under the Labor Standards Act, citing the facts that the worker was free to refuse dispatch assignments, that working hours and locations were not specifically designated, and that side jobs were permitted (Supreme Court Decision 2016Du49372, April 26, 2018 (대법원 2018. 4. 26. 선고 2016두49372 판결)1). Although the outcome may vary depending on how a delivery agency operates, given the relatively autonomous nature of delivery agency work, employee status is generally denied in this way.

However, it is important to note that this Supreme Court ruling was a judgment on that particular working arrangement and did not categorically deny employee status for all delivery workers affiliated with delivery platforms. In a recent case where a delivery platform rider challenged the termination of a service outsourcing contract as a de facto dismissal, the Seoul High Court recognized the rider’s employee status under the Labor Standards Act, citing real-time control through the app’s algorithm and GPS map monitoring, the exercise of substantive approval authority over dispatch cancellations together with the imposition of penalties, management of attire and attendance, and the unilateral determination of remuneration criteria. The court further held that the contract termination, carried out without written notice, constituted a dismissal and was therefore void (Seoul High Court Decision 2024Na2037832, July 3, 2026 (서울고등법원 2026. 7. 3. 선고 2024나2037832 판결)2). Ultimately, whether an employment relationship exists is determined not by the form of the contract but by whether there is substantive direction and supervision. The court’s observation in that ruling that “although the plaintiff accepted delivery requests and performed deliveries on a per-job basis, rather than exercising full decision-making authority over them, dispatch was in fact carried out according to the defendant company’s policies through the app’s algorithm and the specific instructions, control, and sanctions of management staff, such that the plaintiff’s performance of work was accompanied by considerable direction and supervision by the defendant company” reflects the same reasoning. In other words, even if the structure outwardly allowed work to be performed autonomously, if the app was in fact controlling the manner of work in fine detail and in real time, this may be deemed direction and supervision equivalent to an employment relationship.

It should also be noted that, in the case of small delivery agencies in particular, there is a tendency for the employee status of their affiliated delivery workers to be recognized because of how they are operated. In a case where a delivery agency claimed a penalty for early termination of a motorcycle lease agreement from a delivery driver who had left the company, the lower court recognized the driver’s employee status based on circumstances such as attendance management through a KakaoTalk group chat, control over tardiness, and automatic processing of resignation upon unexcused absence, and held that the penalty agreement itself was void under Labor Standards Act Article 20 (근로기준법 제20조), which prohibits predetermining penalties or liquidated damages against employees (Seoul Eastern District Court Decision 2024Na32350, January 23, 2026 (서울동부지방법원 2026. 1. 23. 선고 2024나32350 판결)3).

For businesses operating delivery agencies or platforms, it is worth bearing in mind that the actual degree of control, rather than the form of the outsourcing contract, and in particular real-time management through algorithms, is emerging as the key variable in determining employee status.

1. After remand, Seoul High Court Case 2018Nu43523 ended in a partial win for the plaintiff, and the judgment became final when the Supreme Court dismissed the appeal in Case 2019Du34074.↩︎

2. First instance: Seoul Central District Court Case 2022GaHap534381, plaintiff lost; on appeal, the plaintiff partially prevailed and that outcome stands; whether a further appeal was filed is unconfirmed.↩︎

3. First instance: Seoul Eastern District Court Case 2024GaSo950, plaintiff lost; the appeal was dismissed and that outcome stands; whether a further appeal was filed is unconfirmed.↩︎