Korean Severance Pay Calculator for Foreign Workers
Last verified: 2026-08-06
Korean law requires employers to pay severance pay (퇴직금) to employees with at least one year of continuous service who work at least 15 hours per week on average — including foreign employees, since 근로기준법 제6조 prohibits nationality-based discrimination in working conditions. This calculator gives an estimate based on the statutory formula; it is not a legal determination of what your employer owes you.
Retirement income tax is not deducted. This estimate shows gross severance pay before 퇴직소득세 (retirement income tax) withholding. Your actual net payment will be lower once retirement income tax is applied.
Worked example
An employee worked from 2023-03-01 to 2026-06-30 (1,217 continuous days), with a stable monthly base wage of ₩3,000,000 and no additional allowances, using Simple mode. The 3 calendar months immediately before the last day (2026-03-30 to 2026-06-30, 92 calendar days) give a total wage of ₩9,000,000, an average daily wage of about ₩97,826, and an estimated gross severance of about ₩97,826 × 30 × (1,217 / 365) ≈ ₩9,785,289. Enter these values into the calculator above to see the exact result.
How this is calculated
Formula (근로자퇴직급여보장법 제8조): severance = average daily wage × 30 × (continuous service days ÷ 365). Average wage (평균임금, 근로기준법 제2조제1항제6호) is total wages paid in the 3 calendar months immediately before your last day, divided by the number of calendar days in that period. If your ordinary wage is higher, the ordinary wage is used instead (평균임금 최저한 보장).
Assumptions and limitations
- This tool assumes standard employee status under 근로기준법. It does not model excluded periods (e.g. certain unpaid leave), disputed employment classification, or company-specific severance plans that pay more than the statutory minimum.
- Workers on E-9 (non-professional employment) or H-2 (working visit) visas under the Employment Permit System typically receive a severance-equivalent payout through 출국만기보험 (Departure Guarantee Insurance) instead of standard employer-paid severance. This calculator estimates the standard 근로기준법 formula only and does not model that insurance payout.
- Retirement income tax (퇴직소득세) is not deducted from the estimate shown.
- If you don't enter an ordinary daily wage, the estimate may understate your true legal entitlement in months where ordinary wage would be higher than average wage.
Official sources
- 근로자퇴직급여보장법 (Employee Retirement Benefit Security Act), Article 8
- 근로기준법 (Labor Standards Act) 제2조, 제6조; 근로기준법 시행령 제2조
- Ministry of Employment and Labor: moel.go.kr
Last verified: 2026-08-06. See methodology for how estimates are calculated and their limitations.