South Korea Employment Guide
South Korea Employment Guide
South Korea, located in East Asia on the southern half of the Korean Peninsula, has a population of about 52 million and a highly developed economy driven by technology, automotive, shipbuilding, and electronics industries. Employment in South Korea is regulated by the Labor Standards Act, which covers working hours, minimum wage, overtime, paid leave, termination, and workplace safety. Employers must also comply with national health insurance, pension, and social security contributions. South Korea emphasizes employee rights and workplace fairness, and foreign workers must adhere to the same labor regulations as local employees.
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Currency
South Korean Won (KRW)
Capital
Seoul
Official language
Korean
Salary Cycle
Monthly
Our Employment Guide in South Korea
Browse the following tags to learn all about hiring employees in South Korea
South Korea's Minimum Wage Requirements
Effective January 1, 2025, South Korea's minimum wage is set at 10,030 KRW per hour, translating to a monthly minimum of 2,096,270 KRW for full-time workers.
It's important to note that regular monetary benefits, such as fixed allowances and bonuses, are factored into the minimum wage calculation. For example, if an employee receives a fixed monthly transportation allowance, this amount must be included when determining compliance with minimum wage laws.
Personal Income Tax Structure
South Korea employs a progressive income tax system with rates ranging from 6% to 45%. This means higher income brackets are subject to increased taxation rates.
| Annual Income (KRW) | Tax Rate |
|---|---|
| Up to 12,000,000 | 6% |
| 12,000,001 - 46,000,000 | 15% |
| 46,000,001 - 88,000,000 | 24% |
| 88,000,001 - 150,000,000 | 35% |
| 150,000,001 - 300,000,000 | 38% |
| 300,000,001 - 500,000,000 | 40% |
| 500,000,001 - 1,000,000,000 | 42% |
| Over 1,000,000,000 | 45% |
Employer Cost Considerations
Total employment costs typically amount to approximately 11% of gross salary plus mandatory disability employment contributions.
- National Pension: 4.50% (capped at 265,500 KRW monthly)
- National Health Insurance: 3.54%
- Long-term Care Insurance: 0.448%
- Employment Insurance: 1.15% - 1.75%
- Industrial Accident Compensation: 0.76%
- Resident Tax: 0.50%
- Disability Employment Contribution: Approximately 62,328 KRW
Consider a case where SailGlobal hires a software engineer at 60 million KRW annually. Beyond the base salary, the company would incur approximately 6.6 million KRW in statutory contributions, plus disability fees.
Working Hours and Overtime Regulations
The standard workweek consists of 40 hours, typically distributed as eight hours daily from Monday through Friday.
Overtime compensation is mandatory for hours exceeding this standard. Employees may work up to 12 additional hours weekly, with overtime pay set at a minimum of 150% of their regular wage. For instance, an employee earning 15,000 KRW per hour would receive 22,500 KRW for each overtime hour worked.
These regulations ensure fair compensation while maintaining workforce productivity. Companies like SailGlobal must carefully track working hours to maintain compliance with Korean labor standards.
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