In recent, the Tokyo District Court made a decision on the case of JAL’s laying- off(hereinafter called as “This Case”) where the reorganizing trustee of the company that applied for corporate reorganization proceedings laid off employees. This is the first case that brought controversy over the legitimacy of redundancy dismissal made by trustee based on reorganizing plan.
This may help us get the clear picture of redundancy dismissal case of SSangyong Motors on corporate reorganization proceedings in Korea. Followings are what Japanese academic field views on the This Case, and my own interpretation.
First, it is agreeable that laying-off is unavoidable in corporate reorganization proceedings. However, this doesn’t mean that all companies can freely lay off employees. They should consider the necessity of laying off and take various factors into account for the magnitude of layoff.
Second, massive severance pay can be an obstacle to corporate reorganization, or, it can be an infringement of creditor’s property rights. It may cause the rejection of reorganizing plan due to objections from the creditors.
Third, This Case implies that age and disease are reasonable standard for designating the workers who are to be laid off. However, age should be excluded to be the standard for it violates the constitutional rights of equality.
Fourth, we have to apply the flexible principle of interest balancing as there are time limits for reorganization proceedings.
Fifth, according to Corporate Reorganization Act, reorganizing plan has the same effect as the final ruling. Thus, when they lay off employees based on their regulation they made, it must be considered as final decision.
Considering the factors mentioned above, This Case can be seen as agreeable in general, but it must be invalid as it violates the constitutional rights of equality when they apply age as a standard for designating the workers who are to be laid off. Although laying off was inevitable for the company in reorganization proceedings, and agreeable because it was done based on the reorganizing plan which has the same effect as the final ruling, there must be some people who laid off and fell victims because the standard of designating the workers who are to be laid off is unconstitutional. Thus, This Case must be invalid as it violates the constitutional rights for humanlike life and work and equality.