Korean severance pay (퇴직금): 30 days of average wage a year, as the Labor Ministry works it
Estimates only, not financial advice. What you type stays on your device. Checked against sources on 16 Oct 2026.South Korean severance pay is 30 days of average wage for each year of service: the daily average wage of the last 3 months times 30 times the days of service, divided by 365. With ₩2,360,000 a month and a ₩4,000,000 bonus over 1,080 days, it comes to ₩7,868,434.
2026 · Rates and rules read from the sources listed on this page (the earliest on 16 Oct 2026); they may have changed since.
Enter the start date and the retirement date, which is the day after your last working day.
Type the monthly wage before tax: basic pay plus regular allowances.
Add the annual bonus and the annual-leave allowance paid in the last year; 3/12 of each counts.
If you know your daily ordinary wage, type it: it is used when it is higher than the average.
Read the severance pay, the daily average wage and the working.
This calculator works out Korean severance pay, 퇴직금, the way the Ministry of Employment and Labor's own calculator does, from Articles 4, 8 and 9 of the Employee Retirement Benefit Security Act and Article 2 of the Labor Standards Act.
The formula. Severance is at least 30 days of average wage for each year of continuous service: daily average wage × 30 × days of service ÷ 365. Part years count by the day.
The average wage. Wages paid in the 3 months before the retirement date, divided by the calendar days of that period. The Ministry adds 3/12 of the annual bonus and 3/12 of the annual-leave allowance, then rounds the daily figure up to the jeon (two decimals). If your daily ordinary wage (통상임금) is higher, that is used instead.
A worked example. The Ministry's own: start 2 October 2014, retirement date 16 September 2017, 1,080 days. ₩2,360,000 a month gives ₩7,080,000 over 92 days; 3/12 of a ₩4,000,000 bonus adds ₩1,000,000 and 3/12 of ₩300,000 leave pay ₩75,000. ₩8,155,000 ÷ 92 is ₩88,641.31 a day, and ₩88,641.31 × 30 × 1,080 ÷ 365 is ₩7,868,434.
The dates. The retirement date is the day after your last working day. Under one year of continuous service, or under 15 hours a week, no severance is required.
Payment. Within 14 days of leaving, usually into an IRP retirement account. An interim settlement restarts the count from that day.
Not included. Excluded periods such as parental leave, defined-benefit or defined-contribution pension plans, and retirement income tax. An estimate; company rules may pay more.
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Korean severance pay (퇴직금) is at least 30 days of average wage for each year of continuous service: the daily average wage times 30 times the days of service divided by 365. The Ministry's example, ₩88,641.31 a day over 1,080 days, gives ₩7,868,434.
Under Article 2 of the Labor Standards Act, the average wage is the wages paid in the 3 months before leaving divided by the calendar days of those months, usually 89 to 92. The Ministry adds 3/12 of the annual bonus and of the annual-leave allowance.
Every employee with at least one year of continuous service and at least 15 hours of work a week on average over four weeks. Contract, part-time and foreign workers qualify on the same terms. Under one year, the law requires nothing, so this calculator shows ₩0.
Article 9 of the Employee Retirement Benefit Security Act gives the employer 14 days from the day you leave. A later date needs both sides to agree. Since 2022 it is usually paid into an IRP retirement account rather than to your bank account.
Article 2 ② of the Labor Standards Act says the ordinary wage (통상임금) is then used as the average wage. That protects people whose last three months were short, such as after unpaid absence. Type your daily ordinary wage and the higher figure is used.
Yes. Severance is taxed as retirement income (퇴직소득세), separately from salary and at a low effective rate thanks to deductions for years of service. The National Tax Service publishes a calculator on hometax.go.kr; this page shows the amount before that tax.
Rates and rules change; check the source before you rely on a figure.
Still stuck? Ask about South Korea Severance Pay Calculator (퇴직금) and anybody who knows can answer. No account needed.
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