Severance Pay (퇴직금) for Foreign Workers in Korea

You are leaving a job — resigned or dismissed — after working there for at least a year. Many foreign workers do not realise they are legally entitled to a lump-sum severance payment on top of their final wages.

Medium riskEmployee Retirement Benefit Security Act (근로자퇴직급여 보장법)

Applies to

employee

Quick answer: If you worked continuously for 1 year or more, averaging at least 15 hours a week, you are entitled to severance of at least 30 days’ average wage for each year of service. It applies to all workplaces (even under 5 employees), to any visa status, and whether you quit or were let go. It must be paid within 14 days of leaving.

What Korean law says

  1. ·Under the Employee Retirement Benefit Security Act, an employer must provide a retirement benefit of at least 30 days of average wage for each year of continuous service to a worker who leaves after one year or more.
  2. ·"Average wage" is generally your total wages over the last 3 months (including regular allowances and a proportion of annual bonuses) divided by the number of calendar days — so it is usually higher than base pay alone.
  3. ·The right applies to all workplaces, including those with fewer than 5 employees, and does not depend on the reason for leaving — resignation and dismissal are both covered.
  4. ·It must be paid within 14 days of the date of leaving, the same deadline as final wages, unless the parties agree to extend it. Unpaid severance can be pursued at the Employment & Labor Office like unpaid wages.
  5. ·Workers averaging under 15 hours a week, or with under 1 year of continuous service, are not entitled. For EPS (E-9) workers, a "departure guarantee insurance" (출국만기보험) often functions as the severance mechanism.

Required conditions

  1. ·Continuous service of 1 year or more with the same employer.
  2. ·Average working time of at least 15 hours per week.
  3. ·You are a worker (근로자), not a genuine independent contractor.

What to do next

  1. 1Confirm your start and end dates and calculate total years/months of continuous service.
  2. 2Estimate your average wage from the last 3 months of payslips, then multiply: 30 days × average daily wage × years of service.
  3. 3Ask the employer in writing for the severance calculation and payment date before or at departure.
  4. 4If it is not paid within 14 days, file a complaint (진정) at the Employment & Labor Office — the process is identical to unpaid wages.
  5. 5If you are an EPS/E-9 worker, check your 출국만기보험 balance and claim procedure as well.

Documents to prepare

Employment contract with start datePayslips for the last 3 months (for average wage)Proof of last working day (resignation letter, notice, records)Bank statementsFor E-9: departure guarantee insurance detailsARC / passport

Where to go / who to contact

Local Employment & Labor Office (고용노동부 지청) for unpaid severance; the 1350 helpline can help you estimate the amount. EPS insurance matters go through the relevant insurer/HRD Korea.

Time limit / deadline

Payable within 14 days of leaving. The right to claim severance expires 3 years after it becomes due.

Estimated cost

Free to claim at the labor office. A labor attorney is optional.

Common mistakes

  1. ·Assuming small companies (under 5 employees) owe no severance — they do; severance is not limited by company size.
  2. ·Thinking resignation forfeits severance — it does not.
  3. ·Letting continuous service be artificially "reset" by fake re-signing of contracts; continuous actual work still counts.
  4. ·For E-9 workers, forgetting to claim the departure guarantee insurance after leaving Korea.
Original Korean legal text

근로자퇴직급여 보장법 제8조 제1항 (퇴직금제도의 설정 등) · Employee Retirement Benefit Security Act Art. 8(1)

퇴직금제도를 설정하려는 사용자는 계속근로기간 1년에 대하여 30일분 이상의 평균임금을 퇴직금으로 퇴직 근로자에게 지급할 수 있는 제도를 설정하여야 한다.

근로자퇴직급여 보장법 제9조 제1항 (퇴직금의 지급 등) · Employee Retirement Benefit Security Act Art. 9(1)

사용자는 근로자가 퇴직한 경우에는 그 지급사유가 발생한 날부터 14일 이내에 퇴직금을 지급하여야 한다. 다만, 특별한 사정이 있는 경우에는 당사자 간의 합의에 따라 지급기일을 연장할 수 있다.

Sources

These are official Korean government sites — mostly in Korean. Need help in your language? Use the multilingual helplines below, or tap “Get professional help”.

Multilingual helplines: 1345 Immigration (Vietnamese) · 1350 Labor · 1588-0560 Tax (English) · 120 city services

Last checked: 2026-07-10

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Severance Pay (퇴직금) for Foreign Workers in Korea — KVBiz Law