Labor Standards Act applies to all workplaces, incl. <5 employees (5인 미만 사업장)

Minimum wage

Wage means all the money paid to a worker as compensation for labor, including salary, pay, or any other designation. The minimum wage is a labor standard that must be observed even in workplaces with less than five employees. As of 2023, the minimum wage is 9,620 KRW per hour, which amounts to 2,010,580 KRW per month.

 

Creating a labor contract

Two copies of the labor contract must be made, one for the employer and the other for the employee. Regardless of the type of employment, such as regular, temporary, full-time, or part-time (part-time job), labor contracts must be signed with all workers. Failure to create labor contracts may result in fines or penalties.

 

4 Major Insurances

The four major insurances include industrial accident insurance, employment insurance, national health insurance, and national pension insurance. Employees who work more than 15 hours per week must subscribe to all four insurances, regardless of their employment status.

 

Rest time

A rest period of at least 30 minutes is guaranteed for every 4 hours of work, and a rest period of at least 1 hour is guaranteed for every 8 hours of work.

 

Paid holidays

Employers must grant one paid day off to employees who have worked for 15 hours a week. In most cases, Sunday is designated as the paid holiday. Monthly salaried employees are considered to have received paid holidays included in their salaries. In the case of hourly or daily wage employees, paid holidays must be paid separately.

 

Maternity and parental leave

Maternity leave is a leave taken by female employees to give birth. This leave system is laid out in the Labor Standards Act. Parental leave is a system that allows employees to take up to one year of paid leave to raise a child under the age of 8 or in the second grade of elementary school. This system is stipulated in the 'Act on Supporting Work-Life Balance and Equal Employment between Genders.'

 

Severance pay

Severance pay is compensation paid to an employee upon retirement or termination of a contract. Employees who have worked for more than one year are entitled to receive severance pay regardless of their employment status. They can receive an average of more than 30 days' worth of pay as severance pay. Executives are entitled to receive severance pay in accordance with the regulations on executive severance pay.

 

Notice of dismissal

Employers must give employees 30 days' notice before dismissing them. Failure to do so will result in the employer having to pay 30 days' worth of salary.

 

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