Korea Severance Pay Calculator
For Korean severance rules, enter the employment dates and wage records to review the retirement date, three-month average-wage period, applied daily wage, and pre-tax estimate.
Inputs
| Row | Period | Days | Wages |
|---|---|---|---|
| 1 | |||
| 2 | |||
| 3 | |||
| 4 | |||
| Total | |||
Result
- Three-month bonus and leave allocation
- —
- Average daily wage
- —
- Ordinary-wage floor
- Not entered
- Applied daily wage
- —
Daily-wage comparison
Compare average daily wage with the applied daily wage and see the resulting pre-tax severance estimate.
Once the inputs are valid, comparison bars for average wage, applied wage, and severance will appear here.
Applied daily wage × 30 × service days ÷ 365
ready to use.
- Visible firstKeep the input and result positions clear.
- Results firstPut the main number up front and keep the process secondary.
- Less to askNo sign-up or extra information before using the tool.
Check Korean severance from the average-wage period forward
Korean severance starts by aligning the actual last working day, the preceding three-month average-wage period, and continuous service on one timeline. The table keeps each monthly segment visible so missing wage records stand out.
The headline result is a pre-tax arithmetic estimate. The page does not decide coverage, excluded periods, wage classification, retirement-plan treatment, or a worker’s legal entitlement.
This is a Korean-law calculator
The calculation follows Korea’s Employee Retirement Benefit Security Act and Labor Standards Act. A similarly named severance benefit in the United States or another country may be contractual and use a different method.
Do not use the result as a contract amount or legal entitlement when Korean law is not the governing system.
- Currency: Korean won
- Jurisdiction: South Korea
- Other-country benefits: separate calculation
Check the one-year and 15-hour thresholds first
Current Article 4, effective July 1, 2026, identifies service under one year and scheduled work averaging under 15 hours a week over four weeks as exceptions to the scheme-setting duty.
The tool still returns arithmetic for short service. Compare the contract, schedules, and any interim settlement before reading that number as payable severance.
- At least one year of continuous service
- Four-week average of at least 15 scheduled hours
- Service counted after any interim settlement
Retirement date follows the last working day
Enter the employment start date and the day actually worked last. The next calendar day is shown as the retirement date, and service days include both the first and last working dates.
A resignation notice date, payroll date, or document date can be different. Using one of them shifts both service and the three-month window.
- Verify the employment start record
- Verify the actual last working day
- Compare the derived retirement date
Average wage uses the preceding three calendar months
Article 2 defines average wage as wages paid during the three months before the calculation event divided by the total days in that period. The page splits the window into as many as four calendar-month rows.
Mid-month boundaries and leap years change row lengths. Match the generated dates to the pay records before entering amounts.
- Review period start and end
- Review calendar days per row
- Match each payroll period
Enter eligible wages before deductions
Each row expects the gross wage amount for its date segment, not take-home pay. Entering net pay or a monthly ordinary-wage figure in the wrong field distorts the daily average.
The calculation stops when a row with days has no wage. Whether a particular allowance is legally wages still needs payroll and labor review.
- Use pre-deduction wage records
- Resolve every non-empty period row
- Review wage classification separately
Bonus and annual-leave allowance use a 3/12 allocation
The last-year bonus and annual-leave allowance inputs are multiplied by 3/12 and added to the average-wage base. A combined ₩3,000,000 produces a ₩750,000 allocation.
The input does not prove every bonus or unused-leave payment belongs in average wage. Verify payment conditions and accrual.
- Enter the last-year totals
- Check total × 0.25
- Confirm the payment rule
Ordinary wage is a legal floor comparison
Article 2(2) says ordinary wage replaces calculated average wage when the latter is lower. If the optional daily ordinary wage is higher, the tool uses that amount.
Ordinary wage is a Korean legal term, not necessarily monthly salary divided by workdays. Leave it blank when no reviewed daily amount is available.
- Enter a daily amount only
- Use the higher daily wage
- Review ordinary-wage classification
The estimate applies 30 days per service year
The estimate is applied daily wage × 30 × service days ÷ 365. In the sample, ₩9,600,000 of wages plus a ₩750,000 allocation over 92 days gives a ₩112,500 average daily wage.
Employment from January 1, 2022 through December 31, 2024 contains 1,096 service days because 2024 is a leap year. Displayed won amounts are rounded.
- Three-month base ÷ total days
- Applied daily wage × 30
- Service days ÷ 365
Excluded periods and retirement plans need separate work
The Enforcement Decree lists periods such as part of probation, employer-caused shutdown, maternity leave, occupational injury treatment, and parental leave for exclusion from average wage.
DB/DC retirement plans, interim settlement, investment results, and a more favorable company policy can also change the payment route or amount.
- Review leave and shutdown records
- Review interim settlements
- Review retirement-plan enrollment
Reconcile the estimate before settlement
Recheck the start date, last working day, gross wages, bonus and leave inputs, and the unit of ordinary wage. Inputs are calculated in the current browser view and are not stored as payroll records.
Retirement-income tax, local income tax, and company rounding affect the final transfer. Use Korean labor or tax guidance for a dispute, filing, or settlement.
- Confirm governing law and coverage
- Reconcile dates and amounts
- Review tax, plan, and company rules
- Compare the employer statement
Questions about Korean severance calculations
QWhich country does this calculator cover?
It covers Korean statutory severance only. Do not apply the formula to US employer severance policies, pensions, or another country’s termination benefits.
QWhat date counts as the retirement date?
The tool uses the day after the last working day and divides the preceding three months through the last working day.
QWhy is only 25% of bonus and leave allowance added?
It allocates 3/12 of the last-year amounts to the three-month average-wage base. Whether an item legally counts as wages must be checked against the actual pay rule.
QIs daily ordinary wage required?
No. If entered and higher than average daily wage, the tool uses it as the floor described in Article 2(2) of Korea’s Labor Standards Act.
QCan I calculate service under one year?
The arithmetic works, but Article 4 excludes service under one year and certain other workers from the statutory scheme-setting duty.
QWhat if scheduled hours average under 15 per week?
That may also fall within the Article 4 exception when averaged over four weeks. Check the contract and actual schedule.
QShould leave or shutdown periods stay in the three months?
Not automatically. Probation, employer-caused shutdown, maternity leave, occupational injury treatment, parental leave, and other listed periods may be excluded.
QWhy can the final payment differ?
Excluded periods, interim settlement, DB/DC retirement plans, company rules, wage classification, retirement-income tax, and rounding can change it.
Official Korean sources
Checked August 10, 2026. Retirement Benefits Act Articles 4 and 8 are from the current text effective July 1, 2026; Labor Standards Act Article 2 and Enforcement Decree Article 2 are from the current text effective October 23, 2025.