Severance Pay Obligation: Who Qualifies and What You Get
Learn the legal requirements for paying severance to employees in South Korea, including how to calculate the amount and who is eligible.
This scheme outlines the legal requirement for employers to provide a lump-sum payment to employees when their employment ends.
Who it's for
This applies to employees who have worked for the same employer for more than one year and work at least 15 hours per week.
What you get
When an employee leaves the job, they are legally entitled to receive a payment roughly equivalent to one month of their salary for every year they worked for you.
What it costs you
Employers must set aside the necessary funds to cover these payments. Once an employee is terminated, the full amount must be paid out within 14 days.
The catch to know
Even if you have hired someone as a part-time worker, they still qualify for this payment as long as they meet the weekly hour and yearly tenure requirements.
How to apply
- Track your employees' weekly hours and total length of service.
- Calculate the amount owed based on their salary and years of employment.
- Ensure the total is paid within the two-week window following their departure.