Korea Severance Pay Calculator
Anyone who works in Korea for at least one year, 15 hours or more a week, is entitled to severance pay of about one month's pay for each year worked. Foreign workers get the same right.
Result
Who is entitled
Under the Employee Retirement Benefit Security Act, you are entitled to severance pay if you worked at least one year for the same employer and were scheduled for 15 hours or more a week on average. Nationality and visa type do not matter. Contracts that say "severance is included in the salary" are generally not valid unless the payment is clearly separate.
Formula
The average daily wage is your total pay for the 3 months before your leaving date divided by the number of days in those months. Three-twelfths of your yearly bonus and annual leave allowance are added in.
| Years worked | Monthly pay | Approx. severance |
|---|---|---|
| 1 | ₩3,000,000 | ₩2,934,782 |
| 3 | ₩3,500,000 | ₩10,271,739 |
| 5 | ₩4,000,000 | ₩19,565,217 |
| 10 | ₩5,000,000 | ₩48,913,043 |
When and how it is paid
- Your employer must pay within 14 days of your leaving date, unless you agree to a later date.
- If your company has a DC-type retirement pension, the money goes to your pension account (usually an IRP), and you can withdraw it.
- Retirement income tax is withheld, but it is usually much lower than income tax.
- E-9 workers receive it partly through the departure guarantee insurance (8.3% of monthly wage paid in by the employer), claimed when leaving Korea. If that is less than legal severance, the employer pays the difference.