Statutory severance pay in Korea

Workers with qualifying service and weekly hours may be owed severance pay. Estimate it from daily average wage, 30 days and length of service.

Source baseline 2026-10-06 · Estimates and reference information, not legal or tax advice.

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Find the inputs

Use the contract and HR record for employment dates, and payslips for the actual pre-tax wages in the three-month assessment period. The calculator multiplies an integer monthly average by three; bonuses and qualifying prior-year leave pay are entered separately. Do not count them twice. Excluded periods and different working-hour structures need separate calculation.

Check calendar days and rounding

With a March 2, 2021 start and employment through August 31, 2026, the tenure is 2,009 days and June 1–August 31 contains 92 calendar days. Assuming KRW 10,500,000 in wages, no bonus or leave-pay share and no excluded periods, the calculator floors the daily average to KRW 114,130 and returns KRW 18,845,520 before tax. Keeping the daily fraction until the final step instead gives KRW 18,845,592. The KRW 72 difference explains rounding, not permission to underpay. This arithmetic example omits the required comparison with ordinary wage.

Compare the payroll settlement

Match the assessment period, included wage items, bonus and leave-pay allocation, excluded periods and applied daily wage. Distinguish the pre-tax award from the after-tax transfer. The tool’s ordinary-wage conversion assumes 209 paid hours per month and eight hours per day. Request a breakdown instead of applying that conversion to a different schedule.

Who qualifies

The general statutory threshold is at least one year of continuous service and scheduled weekly hours averaging at least 15 over four weeks. Workplace size alone does not remove this severance rule.

Formula

Daily average wage = wage total during the three months before the retirement date ÷ calendar days in that period. Estimated severance = daily average wage × 30 × days of continuous service ÷ 365. Ordinary wage may replace average wage if the statutory comparison requires it.

Example

For a daily wage of KRW 100,000 and 730 days of service, the simple formula gives KRW 100,000 × 30 × 730 ÷ 365 = KRW 6 million before tax, assuming all wage components and dates are correct.

Excluded periods

Certain periods, such as legally specified leave or shutdown periods, and their wages may be excluded from average-wage calculation. A simple three-month calculator cannot model every exception.

Payment timing

Retirement-related money is generally settled within 14 days unless the parties validly agree otherwise. Confirm payment method and whether a retirement pension account is involved.

Try the calculator

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Sources

The source baseline for this guide is 2026-10-06; individually rechecked sources show their own dates above. Laws and rates may have changed. Consult the originals before an important decision.