Employment 2025

SOUTH KOREA Law and Practice Contributed by: Sihoon Yang, Young Min Kim, Jung Mo Hong and Douglas Hwang, Yoon & Yang LLC

• overtime worked in excess of the statutory working hours (ie, eight hours per day, 40 hours per week); • work performed during holidays (however, 100% of the ordinary wage applies to holiday work exceed - ing eight hours); and • work performed at night (ie, between 10 pm and 6 am). 1.4 Compensation Minimum Wage Requirements By 5 August every year, the minister of employment and labour determines the minimum wage applicable in the following year. The publicly announced mini - mum wage becomes effective as of January 1st of the following year. Currently, the hourly minimum wage for 2025 is KRW10,030. The hourly minimum wage for 2026 is scheduled to be KRW10,320. Employers are required to pay at least the minimum wage to their employees, pursuant to Article 6 (1) of the Minimum Wage Act. Therefore, in accordance with Article 6 (3) of the Minimum Wage Act, employment contracts that stipulate wages below the minimum wage level are invalidated as to such stipulation and, by operation of law, the wages under such employ - ment contracts are presumed to be minimum wages. 13th-Month and Other Bonuses There is no legal requirement for employers in South Korea to pay 13th-month bonuses, etc. Under the South Korean labour laws, employers are only obliged to pay monthly wages and severance pay upon an employee’s resignation. To describe employers’ obligation to provide sever - ance pay in more detail, Article 8 (1) of the Act on the Guarantee of Workers’ Retirement Benefits (the “Retirement Benefits Act”) requires employers to set up a system that enables the employers to pay a retiring worker severance pay in the prorated amount equivalent to the average wages earned in 30 days for each year of the resigning employee’s continuous service. Therefore, even if severance payments are not covered in employment contracts, or are other - wise covered in the employer’s rules of employment, such payments must be provided upon an employee’s resignation.

If an employer is paying “periodic bonuses” as 13th- month bonuses in South Korea, such payment is at the employer’s complete discretion, and there are no provisions in the Labor Standards Act that prohibit such bonuses. Government Intervention The minimum wage system is a classic example of the government’s intervention in compensation. The government determines the minimum wage on a yearly basis. For 2025, the hourly minimum wage is KRW10,030. Aside from the minimum wage system, the govern - ment may make compensation-related interventions by overseeing whether employers are – among other things – paying statutory severance, as well as the additional wages that must be paid for work per - formed overtime, during holidays or at night. 1.5 Other Employment Terms Vacations and Vacation Pay The most typical types of vacation available for employees are: • weekly holidays; • public holidays (ie, holidays prescribed under presidential decree); and • annual paid leave. Weekly holiday (under Article 55 of the Labor Stand - ards Act and Article 30 of the Enforcement Decree of the Labor Standards Act) refers to a paid vaca - tion given to employees who have “worked continu - ously” for the contractual working days in a single week. If employees provide such “continuous work” for contractual working days in one week, employers are required to grant, on average, more than one paid vacation per week. A public holiday prescribed under presidential decree refers to statutory holidays (excluding Sundays) and alternative statutory holidays, which are provided under the Regulation on Holidays of Government Offices. An employer must guarantee such public holidays to its employees on a paid basis. However, an employer may substitute public holidays with oth - er working days by entering into a written agreement

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