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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] A standing special prosecutor investigating allegations of a cover-up in a probe involving Coupang and unpaid severance benefits has summoned Coupang Fulfillment Services (CFS) CEO Jung Jong-cheol as a criminal suspect.
The special prosecutor’s office, led by Ahn Kwon-seop, said on February 2 that Jung was questioned on suspicion of violating the Employee Retirement Benefit Security Act. This marked the first time Jung has been summoned for questioning in the case.
The special prosecutor previously summoned Eom Sung-hwan, the former CEO of CFS, on January 26 on the same charges. Prosecutors allege that Jung and Eom jointly amended CFS’s rules of employment in May 2023 in a manner unfavorable to workers, effectively preventing the payment of severance benefits.
At the time, Eom served as the chief executive overseeing overall CFS operations, while Jung was responsible for the company’s legal affairs. Investigators believe Jung conducted legal reviews on whether the revised employment rules would violate severance pay regulations.
Under the previous rules, daily workers were entitled to severance pay if their continuous employment period exceeded one year, excluding periods during which the average weekly working hours over a four-week period fell below 15 hours. The revised rules changed the standard to require that workers must have averaged at least 15 hours per week over four weeks throughout the entire one-year period.
If any period during employment fell below the 15-hour threshold, the severance calculation would reset, a provision widely referred to as a “reset rule.” As a result, the number of daily workers eligible for severance pay reportedly declined sharply.
Prosecutors believe the changes were intended to reduce severance-related costs. In December last year, the special prosecutor conducted search and seizure operations on Coupang entities over alleged violations of severance pay laws and secured internal documents drafted ahead of the May 2023 rule changes. Among the materials was a report estimating expected reductions in severance payouts following the revisions, with projected savings reportedly amounting to tens of billions of won. Investigators say the report was submitted to former CEO Eom.
Jung may also face additional charges under the National Assembly Testimony Appraisal Act. During a parliamentary audit in October last year, he stated that the purpose of revising the employment rules was to “clarify severance eligibility criteria” and was unrelated to cost-cutting. However, prosecutors say the statement appears to contradict evidence obtained during the investigation.
The special prosecutor and the National Assembly are reportedly reviewing whether Jung’s remarks constitute false testimony.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
