Deciphering the Legal Puzzle of Work Exchange Contracts

【Legal English Series 8：Deciphering the Legal Puzzle of Work Exchange Contracts】

It's time for the highly anticipated Legal English Series again!

As universities enter midterm exam week🔥📚😫, the imminent summer break is looming for students!☀️ Summer marks the peak season for numerous short-term part-time jobs, notably through the trendy "work exchange" model. Here, employers provide food and lodging in return for unpaid work, a popular option among young people during their breaks. Although this work exchange program may appear intriguing, it often stirs controversy. If you're contemplating a new lifestyle through work exchange, read on!

First and foremost, it is essential to clarify the nature of the relationship between the worker and the employer or the guesthouse owner in a work exchange program. Can guesthouse owners establish more flexible "contracting agreements" to avoid the application of labor laws?

✔️Contracting Relationship (Contracting Agreement): Parties agree that one party will complete certain work for the other party and the other party will pay remuneration upon completion of the work (refer to Article 490, Section 1 of the Civil Code).

✔️Employment Relationship (Labor Contract): Parties agree that one party will provide their labor within the subordination of the other party for remuneration (Labor Standards Act applies).

If it falls under an employment contract, then more protective labor laws can be applied. For example, according to the Labor Insurance and Protection Act, even if an employer hires only one employee, they must still report the employee's participation in occupational accident insurance and employment insurance. After enrollment, if an accident occurs during the work exchange program, the employee can apply for compensation. If the contract is classified as a contracting agreement, and if the worker suffers any disadvantage during the course of work, they can only file a lawsuit under civil law and claim damages.

Whether it aligns with the nature of a labor contract can be discussed from three perspectives:

✔️Personal Subordination: The degree of obedience to the employer's orders.

✔️Economic Subordination: Whether the work is for the benefit of others rather than oneself.

✔️Organizational Subordination: Whether collaboration with others is necessary in the work.

The more "yes" answers to the above, the closer it approaches a labor contract, and the greater the chance of being subject to labor laws.

In pursuit of protecting workers, courts tend to broaden the scope of labor contracts so that more workers in the gray area can benefit from the provisions of labor laws. Therefore, courts believe that as long as there is partial subordination, a labor contract relationship should be established. According to the court's lenient interpretation, since most guesthouse owners are likely to still exercise control and supervision over the process of providing services to work exchange participants, theoretically, the relationship between the two parties should be considered an employment relationship and subject to relevant labor laws!

The legal nature of work exchange contracts has long been a major question mark. Only by clarifying it can we proceed to discuss further issues, such as whether it's legal for employers to provide food and accommodation without pay, or if overtime pay can be demanded for hours exceeding the agreed duration. Keep following our Legal English Series as we unravel these mysteries one by one! See you next week!