While South Korea is known for its vibrant culture, thriving consumer markets, and rapid technological progress—there is much to learn about the advantages of setting up a business here. The country has ranked high on the World Bank’s ease of doing business rankings and has experienced a per capita income growth of 89% over the past 50 years. Home to organizations like Hyundai and Samsung—the economic progress of the country relies on the success of corporate entities that have made it possible.

While it may come as a shock to some, the Koreans—much like the Japanese—have a unique approach to business and many shirk from establishing operations in the country owing to cultural and language barriers. However, PEO Korea can help you resolve these problems through our PEO and talent acquisition services. What you cannot ignore is the thriving culture of R&D and innovation that permeates throughout the country’s commercial landscape.

With minimal barriers to foreign investments, numerous free trade zones, and an exceptionally skilled workforce—working in South Korea is perhaps the best decision you could make for your business. If you’re interested, get in touch with us today and we’ll set you up in South Korea to help you achieve your corporate goals.

Normal working hours is from 9am to 6pm with an hour lunch break from 12 to 1.

Full time is 40 hours a week with maximum working hours set to 52 hours a week.

12 hours of hours overtime on weekdays, 16 hours on weekends are set as an overtime.

50% payment is added to additional wage for overtime.

According to the Korean law, the minimum wage is currently 8,590 (approximately USD 7) per hour in 2020 to all employees in Korea.

For a year of employment in Korea, employees are given minimum of 15 days as paid leave. It remains 15 days for the continuous 3 years in the company and an additional one day of paid leave is given on the 4^th year the employee is working for the company.  From the 4th year, additional one day of paid leave will be added every two years. Annual leave shall be paid in the same wage as any workday.

The number of public holidays ranges from 10 to 16 days depending on the year. Those days are:

• New Year's Day
• Lunar New Year’s Day
• Independence Day
• Arbor Day, Children's Day
• Buddha's Birthday
• Memorial Day
• Constitution Day
• Liberation Day
• Chusok
• National Foundation Day
• Hangul Day
• Christmas Day

For termination, there are 2 options in Korea.

Option A) The employer has to give a least 30-day notice in advance.

Option B) Severance pay.  It is a regulation that the employer pays the employee 30-days’ salary as lieu of notice. It applies both to Koreans and foreigners.

It is a regulation that the employer pays the employee 30days of salary as of a termination notice. It applies both to Koreans and foreigners.

Also, there is another severance Korean law for both Korean and foreigners that they can receive a month’s salary for each year they are employed in that company as a retirement system.

Inappropriate termination in Korea may cause result in lawsuits/regulations so connecting with our PEO support will help assist in difficult situations.

-A female employee is entitled to one day of menstruation leave per month once requested. The selected day does not have to be paid.

-Maternity leave is allowed 90 days. The individual and the company can decide on the starting date.

-Parental leave only applies to an employee that has worked for over a year. The employer cannot mistreat the employee of the leave according the equal employment act.

.We strongly recommend having an employment contract in Korea with the company and the employees. They can be done in one or both languages but the information about working hours, salary (wage), and other confidential information should be in the content. Common employment periods are normally for 6 months to 1 year. Employment contract cannot be longer than 2 years.  The training period is set for no longer than 3 months.

As long as injury or illness came from work related, there are no requirements for employers to provide employees with the situation. Employees can follow the company policy and guideline.

Each employee who worked more than 1 year, shall be entitled by the end of the employment period to a Retirement Pay (also called Severance Pay) of 30 days’ average wage for each year of consecutive years of employment. The reason for the retirement or termination of the employment agreement by the employee or the employer does not affect the entitlement to the retirement pay.

There are four major social insurances that the employees must follow:

1. Industrial Accident Compensation Insurance
2. National Health insurance
3. National Pension insurance
4. Employment insurance

Find out how your business can start expanding in South Korea by communicating with a Professional Employer Organization (PEO) from PEO Korea. Get a free consultation with PEO Korea today.