‘Company A’ has a youth internship program in which participants may be converted to regular employment status. New employees go through this internship program, after which 70% become regular employees based on evaluation of their work performance. ‘Intern A’ received a notice of disqualification and did not become a regular employee in accordance with the related work performance evaluation after the internship program. Intern A complained that the evaluation did not reflect his/her actual work performance. Is the decision to reject granting regular employment status considered justifiable?
The advantages of internship programs
Recently, unemployed young people have criticized internship programs at companies as a ‘vain hope’, as participants have difficulties dealing with the excessive workload, but hang on in the hopes of obtaining regular employment status after the program is completed. Company A in this case seems better than the average as it has a fixed rate of 70% granting such status, while this is not the case for many other companies.
There are significant advantages to internship programs. Companies can identify excellent workers through these programs beforehand and jobseekers can stay with a company after considering their suitability through their experiences. In a survey, a majority of jobseekers selected the greatest advantages of internship programs as ‘work experience’ (68%), and ‘job suitability assessment’ (57%).
Criticism over the internship programs is inevitable due to the deepening youth unemployment. Nonetheless, these programs still provide opportunities to jobseekers, especially during times of unemployment, and both companies and jobseekers can use these advantages.
What is the definition of ‘internship’ and its appropriate duration?
Internship is not defined under the law, but in Korea refers to a temporary position before regular employment. This position can be described as probationary under the law. Terms such as ‘probationary employee’ and ‘trainee’ are used without any clear differentiation when firms carry out such programs. However, ‘training’ is a form of work designed to develop a worker’s skills after employment contract is signed, whereas ‘probationary employment’ refers to a trial period before an employment contract is made. The two terms appear similar in definition and legal position, and some judicial precedents use the two terms interchangeably. Internships can vary by type, period, or operational process, but it’s like a trial period before actual employment.
Employers should be cautious in setting a duration for internships. While the period is commonly between 3 months and 1 year, internships longer than 3 months may cause doubt as to their legitimacy. Justifiable reasons are needed to ensure that long internships are recognized appropriate.
What are the grounds for recognizing as fair an employer’s decision not to hire interns as regular workers?
Many firms hire workers under the condition that the workers go through internships. Of course, internship form varies by industry or type of firms. What is the difference between regular recruitment and internship, and why do firms run internship programs?
No.1 reason for using such a program is to verify whether a new hire suits the organization. Companies have the chance to see a potential employee’s skills, work attitude, and social skills, among other things, before hiring. Moreover, the decision not to hire an intern after the program is complete is more broadly recognized as justifiable, whereas firing regular workers is restricted in Korea.
What are the legal grounds to decide not to hire someone who has completed the internship program? Companies can ‘wait and see’ during the internship period, and exercise their management rights at the end. This type of contract termination is more accepted than dismissals, according to court decisions.
Nonetheless, the content of an internship contract must be regulated under the employment contract and staff regulations, and interns notified when they are brought on board. Disputes are always possible if companies leave the internship period undefined or other details of it unclear. In many cases, interns insist that they understood that they had signed a full-time regular contract when companies decide not to engage in a regular contract with them upon completion of the internship period. This insistence is attributed to the fact that companies have to meet very strict criteria before dismissing workers, once they are recognized as regular employees. Therefore, companies are advised to thoroughly review their internship contracts in the interest of preventing such disputes.
A fair and objective evaluation system
One of the priorities in internship programs is establishment of a fair and objective evaluation system. Such an evaluation system is essential since the program is to distinguish between qualified and unqualified workers. Even though companies can decide not to hire an intern as a regular worker, they need a minimum justifiable reason for doing so. Therefore, an evaluation process that can easily be recognized as fair and objective is needed to guarantee the legitimacy of the company’s decision.
Evaluation items, criteria, and index score for regular employment should be settled in advance, as well as a specific evaluation tool such as job checklist. Statements from co-workers or reputation within the organization are not acceptable criteria. Moreover, index scores that are too high or vary widely in scores from different evaluators may also serve to damage the reliability of the evaluation system. Assigning each department to reject its interns as regular workers without any clear criteria raises many issues, so this measure should not be used.
Moreover, companies should be careful about making promises such as ‘a full-time regular job will be offered once you prove that you are a good worker.’ A recent ruling of the Supreme Court recognized workers’ right to expect to become regular employees, when a company made a verbal promise to a particular worker that it would grant that worker regular employment status. Although offering a full-time regular job is not stipulated in the contract, exercising the right not to ultimately hire could be severely restricted if companies lead interns to believe they will get a full-time regular job.
Company A’s case
The internship program at Company A has reasonable criteria such as 3-month duration, and a fixed 70% hiring rate as regular workers. The issue in this case is whether the evaluation is objective and fair. If the company has an assessment process and criteria that anyone can accept and evaluates its interns according to the set standards, then the company will be recognized as fairly exercising its right not to hire.