Undocumented foreign workers employed at a lodging facility in Seoul endured extreme labor conditions, working in 24-hour shifts on alternate days. They received no overtime pay or severance pay, and were even subjected to harassment by management. All of this occurred under the guise of being a "workplace with less than 5 employees," despite the actual number of staff significantly exceeding this figure.
Left in a blind spot of the law, they became victims of a structural loophole known as a "fake workplace with less than 5 employees."

24-Hour Alternate Day Shifts and a Reality Without Allowances

Mr. A, an undocumented foreign worker who worked at a lodging facility in Jongno, Seoul, repeatedly worked 24-hour shifts followed by a day off. Beyond his basic salary, he received no overtime pay, night shift pay, or holiday pay.
"The manager used to curse at me and harass me," Mr. A said. "The work was too difficult, and later I quit because I wasn't even getting paid allowances."

The problem was that this workplace was registered as a "workplace with less than 5 employees," the key threshold of the Labor Standards Act. However, there were only 4 undocumented foreign workers, and including day shift workers, laundry staff, and the manager, the total number of employees exceeded seven.

Circumventing the Labor Standards Act: The Structural Problem of Fictitious Registration

The current Labor Standards Act applies major provisions such as overtime pay, night shift pay, holiday pay, annual paid leave, notice of dismissal, and severance pay only to businesses that consistently employ 5 or more workers. Consequently, some businesses conceal their actual employee count of 5 or more and falsely register as "less than 5 employees."

The lodging facility in question was found to have evaded the protections of the Labor Standards Act by falsely reporting itself as a workplace with fewer than 5 employees.
As a result, undocumented foreign workers employed there received no legal protections, including various allowances and limits on working hours.

Undocumented Foreign Workers Outside the Protection of the Law

The seriousness of the problem is also evident in their status as "undocumented foreign workers." It is difficult for them to report their suffering to the outside or assert their legal rights.
Even when the Ministry of Employment and Labor conducts labor inspections, their undocumented status leads to complications with violations of the Immigration Control Act, making it difficult to provide proper protective measures.

Some workers at the lodging facility endured these issues and filed claims for unpaid wages. The Ministry of Employment and Labor confirmed that the actual number of employees was 5 or more and launched an investigation.

The Reality of Fictitious Workplaces and the Structural Risks of Labor Blind Spots

This incident is not merely a case of illegal employment. It is a structural problem created by the combination of employers' fictitious registrations, the authorities' neglect of blind spots, and the limitations in the application of the law.
An official from the Ministry of Employment and Labor stated, "There are not a few cases where businesses employing foreign workers evade the Labor Standards Act through fictitious registration," and added, "We will take legal action against those found to be in violation."

Such structural evasion pushes undocumented foreign workers into even more vulnerable positions and has become a breeding ground for human rights violations and long working hours.

Calls for Institutional Improvements Are Also Ongoing

Experts point out the need for the following institutional improvements:
First, **strengthened on-site investigations into the criteria for workplaces with less than 5 employees and stricter penalties for fictitious reporting** are necessary.
Second, **institutional mechanisms must be established to resolve the dual blind spot, ensuring that undocumented foreign workers can be protected under labor standards laws**.
Third, **the labor inspection functions of the Ministry of Employment and Labor need to be enhanced, and information-sharing systems between related agencies must be made more robust**.

This incident is not an isolated event at a single workplace. As long as the boundary of the "less than 5 employees" system is unclear and structural circumventions exist to exploit it, another victim can arise at any time.
Our society is now at a point where we must re-examine the legal framework for un Fprotected workers.