Paid Leave Allowance Calculation: Including <5 Employees

If an employee fulfills the entire workdays of a week, they are granted a paid day off for the weekly paid holiday. On the paid holiday, they do not work and receive one day's worth of wages. For salaried employees, the monthly salary already includes the paid leave allowance. For hourly employees, the paid leave allowance is provided if they work for 15 hours or more per week. However, it is also provided if they are expected to work for 15 hours in the following week. The paid leave allowance is not compensation for past work but payment for anticipated future work.

 

 

Provision of paid leave allowance for absences

The paid holiday is granted when all regular workdays of a week are fulfilled. If an employee is absent during weekdays, the paid holiday will not be granted. Paid leave allowance should be provided even in workplaces with fewer than 5 employees.

 

 

Designation of the weekly paid holiday

In most cases, Sunday is designated as the paid holiday. However, it is also possible to designate a different day other than Sunday as the paid holiday based on the nature of work. This can be indicated in employment rules or determined in advance for employees to anticipate.

 

 

Amount to be paid as paid leave allowance

For monthly salaried employees, the monthly salary already includes the paid leave allowance. For hourly, daily, or weekly wage employees, if the paid leave allowance is not explicitly stated, it can be considered as not included.

 

 

Calculation of paid leave allowance: Simply add 20%

You can calculate the paid leave allowance by considering it as a 20% increase in your own work. You can refer to the following formula. Note that the paid leave allowance is granted when the weekly working time is 15 hours or more.

 

 

Example calculation of paid leave allowance 1: Hourly wage of 10,000 KRW, working 15 hours per week

180,000 KRW = 150,000 KRW + (150,000 KRW x 20%)

 

 

Example calculation of paid leave allowance 2: Hourly wage of 10,000 KRW, working 40 hours per week

480,000 KRW = 400,000 KRW + (400,000 KRW x 20%)

 

 

Payment of paid leave allowance upon resignation

The paid leave allowance is not compensation for the work done in the current week but is granted in anticipation of work in the following week. Most employees work from Monday to Friday and take weekends off. In the case of an employee resigning, the occurrence of paid leave allowance depends on the last working day. If an employee finishes working on Sunday and then resigns, the paid leave allowance will be granted. This is because the employee finishes working on Sunday and the next working day, Monday, becomes the resignation date.

 

 

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