If companies could dismiss workers at will, then there would be a great danger that dismissal will be misused. Especially in Korea, where the social welfare system is still almost non-existent, such a law would constitute a serious economic, as well as social blow to such workers.Therefore, it is necessary to place certain restrictions to dismissing a worker such as justifiable reasons and process.

– Penalties are necessary for companies violating the laws, which are designed to prevent
the misuse of the right of dismissal.
On the other hand, the Labor Standards Act was amended in February 1998 allowing an immediate execution of a dismissal for managerial reasons in order to improve the flexibility of the labor market.
– That would be the case when deteriorating business makes it necessary to conduct a
business transfer, merger or acquisition in order to avoid further deterioration of the
business.