'Unpaid severance' suspect Jeong Jong-chul, head of Coupang CFS, summoned for questioning

[Financial News] The Permanent Special Prosecutor Team for Kwan Bong-kwon and Coupang, led by Special Prosecutor Ahn Gwon-seop, has summoned Jeong Jong-chul, CEO of Coupang Fulfillment Services (CFS), for the first time to question him as a suspect over allegations of failing to pay workers their retirement benefits.
The special prosecutor team announced in a press notice that "since 10 a.m. today, we have been questioning Jeong in his capacity as a suspect," adding, "the alleged offense is a violation of the Act on the Guarantee of Employees' Retirement Benefits (Retirement Benefits Act)."
Jeong and former Coupang Fulfillment Services (CFS) CEO Eom Sung-hwan are suspected of revising the company work rules to the disadvantage of employees in May 2023 and, as a result, failing to pay them retirement benefits.
At the time of the incident, Coupang changed its rules on the payment of retirement benefits from excluding only periods in which daily workers who had worked for at least one year logged fewer than 15 hours per week, to limiting eligibility to those who had worked for at least one year with weekly working hours of 15 hours or more.
Under the new rule, if there was even a single day during the employment period when the weekly working hours fell to 15 hours or less, the period used to calculate retirement pay would be reset from that date, leading it to be dubbed the "retirement pay reset rule."
The special prosecutor team believes that workers at the Coupang logistics center were under the direct instruction and supervision of the employer and, because their employment contracts were repeatedly renewed and their work continued for more than a year, they should be entitled to retirement benefits.
The Retirement Benefits Act stipulates that employees are eligible for retirement pay if they have worked continuously for at least one year and their average weekly working hours over four weeks are 15 hours or more.
On this basis, the special prosecutor team previously carried out searches and seizures at Coupang Headquarters, the offices of Coupang Fulfillment Services (CFS), and locations linked to former CEO Eom.
The warrant is said to have listed violation of the Retirement Benefits Act as the alleged offense.
As a result of the raids, investigators reportedly obtained an internal document estimating that CFS could save several billion won in costs through the change in work rules. The document is also said to have been reported to former CEO Eom, who had claimed that the revision of the work rules was unrelated to cost savings. The special prosecutor team is expected to question Jeong on whether he received reports on such internal documents, the background to the changes in the work rules, and the overall decision-making process surrounding the revisions. Since 2022, Jeong has served as the legal affairs CEO at CFS, overseeing corporate legal matters and legal support related to working conditions and safety, and he is reported to have been involved in changing the rules on the payment of retirement benefits. Separately, on the 26th of last month, the special prosecutor team summoned former CEO Eom as a suspect for questioning.
kyu0705@fnnews.com Reporter Kim Dong-gyu Reporter