The debacle has renewed calls for strengthened legal provisions to protect whistleblowers from retaliation.
Hyundai's recent recall of 240,000 vehicles in South Korea has prompted criticism of the country's corporate culture and treatment of whistleblowers.
Former Hyundai engineer Kim Gwang-ho is credited with successfully pressuring the company to address an alleged defect. He reportedly leaked internal company documents to government officials to back allegations of wrongdoing, accusing the company of failing to report potential safety issues.
"The issues raised were being monitored before his request was made, as part of our stringent internal procedures," Hyundai said in a statement, denying claims of a cover-up.
A New York Times report suggests the dispute has shed light on an unflexing corporate culture that demands loyalty and a strict chain of command. Critics argue the South Korean government is partly to blame, lacking legal protections to prevent retaliation against whistleblowers.
Hyundai reportedly fired Kim and followed up with lawsuits last year, accusing the former employee of breach of trust and violating confidentiality agreements. South Korea's civil rights commission later ordered Hyundai to rehire him, however he resigned as part of a settlement to end the legal battles.