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The Ultimate Guide to Hiring Employees in South Korea

Simplify hiring employees in by partnering with Playroll. Our Employer of Record (EOR) handles hiring, onboarding, payroll, taxes, immigration, benefits administration, and compliance. While you maintain control of day-to-day tasks and responsibilities.

hiring-in-South Korea-guide

Key Considerations Before Hiring In South Korea

Employing in South Korea requires employers to own a legal entity in the country and manage payroll, tax, benefits and compliance through their own in-country resources. Grow your team in South Korea with our Employer of Record solution, ensuring streamlined, compliant business expansion with no entity.

Playroll allows you to hire employee's in South Korea quickly, easily and we even automate tax document collection, benefits, payroll and more.

Good To Know

South Korea is recognised as one of the Four Asian Tigers and has attained the status of a "high-income country" according to the OECD. Following rapid economic growth since the 1980s, South Korea is acknowledged as one of the world's leading technologically advanced nations.

Ranked as the 14th largest economy globally and the 5th most business-friendly nation, South Korea's government has fostered an environment conducive to international companies, establishing robust economic ties with the majority of Asian countries.

The private sector flourishes in South Korea, home to globally renowned brands such as Samsung, LG, Hyundai, and Korea, which have gained fame as prominent manufacturers of electronics within the country.

Technological literacy is widespread among the South Korean population, with 96% of its citizens being internet users. Benefiting from a highly robust infrastructure, fibre optic internet connections are prevalent throughout the nation.


Fundamental Aspects of Employment in South Korea

In South Korea, employment contracts must be written and can be in a foreign language. Both indefinite and fixed-term employment are allowed, but the latter cannot exceed 2 years. If it does, the employee becomes permanent. Mandatory contract elements include:

Probationary Period in South Korea

In South Korea, probation periods for permanent employees are optional and usually last 1-3 months. Employers seldom terminate contracts after probation/training due to the associated unemployment costs for the company.

Working hours in South Korea

The standard workweek in South Korea is 8 hours per day and 40 hours per week.

Overtime in South Korea

Hours worked beyond the standard 40 hours per week are categorised as overtime and compensated at 150.00% of the regular pay rate, increasing to 200.00% for night work post 10 pm. There is a cap of 12 hours on weekly overtime, and the overall work hours, inclusive of overtime, must not surpass 52 hours per week.

Navigating Key Aspects of Payroll in South Korea

South Korea has a robust and complex payroll and tax system, and as an employer, it pays to understand payroll process basics.

1 January - 31 December

Fiscal Year in South Korea

1 January - 31 December is the 12-month accounting period that businesses in South Korea use for financial and tax reporting purposes.

Payroll Cycle in South Korea

The payroll cycle in South Korea is usually monthly, with employees being paid on the last working day.
8,590 KRW p/h

Minimum Wage in South Korea

The minimum wage for employees in South Korea is typically 8,590 KRW per hour, amounting to ~1,795,310 KRW per month for a typical 40 hour work week.

Minimum wages and salaries in South Korea

The National Minimum Wage in South Korea stands at 8,590 KRW per hour and is applicable to all companies and employees, irrespective of residency status.

Bonus Payments in South Korea

South Korea does not have legislation mandating 13th-month payments.

Comprehensive Overview of Employment Taxes in South Korea

Understanding the tax obligations for both employers and employees is crucial when operating in South Korea's business landscape. This section explains how taxes and statutory fees affect payroll and individual earnings in South Korea.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 11.00% on top of the employee salary in South Korea.

Tax Rate Tax Type

Employee Payroll Tax Contributions

In South Korea, the typical estimation for employee payroll contributions cost is around 9.40%.

Tax Rate Tax Type

Individual Payroll Tax Contributions

Individual income tax in South Korea follows a progressive rate structure, ranging from 6% to 45%. The tax is calculated based on the taxpayer's income, with higher rates applied to higher income brackets.

Tax Rate Income Bracket

Pension in South Korea

The South Korean National Pension is set at 9% of annual salaries, divided equally between employers and employees. This comprehensive program encompasses old-age, disability, and survivor's pensions, providing income security and contributing to national welfare in the event of retirement, disability, or death for South Korean citizens.

The tax-related information provided in this guide is intended for general guidance and informational purposes only. Reach out to our dedicated team for insights on remote hiring in South Korea tailored to your needs.

Easily navigate payroll, taxes and contributions with Playroll.

Grow your distributed workforce today!

Understanding the Protocols for Termination of Employment in South Korea

When it comes to terminating employment in South Korea, understanding the legal obligations regarding severance pay and contributions is essential. Below is a detailed overview of the key considerations for both employers and employees.

Termination Process

In South Korea, employers are not permitted to terminate employees at will; terminations must be justified. Acceptable justifications for compliant terminations include:

  • Voluntary employee resignation
  • Mutual agreement
  • Unilateral decision by the employer (based on employee misconduct or criminal offenses, neglect of duties, receiving 3 warning letters, inability to perform assigned duties, engaging in criminal conduct while on duty, and business failure leading to imminent bankruptcy)
  • Contract expiration

Notice Period

There is no mandatory notice period in the South Korean Labour Law unless specified in the employment contract or company manual. Nevertheless, it is customary to give 1 month notice to employees.

Severance Pay

Under the statutory severance pay system in South Korea, employees, regardless of the reason for termination, including voluntary resignation, are entitled to severance pay if they have been employed for at least 1 year. This pay amounts to 30 days of their average wage, which includes bonus pay from the preceding 3 months, for each year of continuous service.

Annual Leave Entitlements and Company Policies in South Korea

The annual leave entitlement in South Korea is 15 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays in South Korea

In South Korea, 11 public national holidays are observed each year:

Holiday Date

Paid Time Off in South Korea

Maternity Leave in South Korea

Paternity Leave in South Korea

Sick Leave in South Korea

Injury Leave

Parental Leave In South Korea

South Korea's Benefits Built Into Playroll

Competitive benefits package in South Korea

Playroll is committed to providing tailored, competitive benefits packages that are designed not only to attract but also retain top talent worldwide. Our global team of benefits experts build custom local packages to ensure your employees in South Korea's needs are met. Typically our packages contain some or all of the following benefits.

Health Insurance
Pension or 401k
Life and Disability Insurance
Vision Insurance
Dental Insurance
Discounts & Perks

Playroll Supplementary Benefits For Employment In South Korea

Make your benefits package in South Korea a talent magnet with Playroll's local plans. We offer benefits that are compliant, comprehensive, and flexible — all at competitive rates. Speak with our local territory experts to explore the localized benefits we can offer you, while you scale your team.

Statutory benefits for employment in South Korea

Playroll allows you to provide localized benefits for employees in South Korea within minutes. All in one manageable online dashboard. If you'd like specific information about our benefits packages in South Korea create an account or contact our global expansion team, today.

Playroll Benefit Services

Playroll's Expertise in Facilitating Work Visas for South Korea

At Playroll we're all about empowering employees to work anywhere, making mobility possible for global teams. We sponsor visas and hire the employee for you, so you don’t have to worry about payroll, taxes, and more.

It's important to note, visa support can be complicated. There are many variables that affect whether sponsorship is possible, including one’s nationality, education, marital status, and the immigration policy for the country in question.

Unfortunately, this means we can’t support visas everywhere - with that being said, we handle the entire visa process in-house, and dig into your situation to give you an overview of what to expect if we're able to help with visa sponsorship in South Korea.

Playroll Immigration Support

Integrated EOR Platform

Legal and compliance experts are readily available to provide guidance and case-by-case Q&A support.

Accelerated Immigration Timeline

By leveraging dedicated support from in-house legal and compliance experts for case by case questions and more.

Hire in 50+ Countries

Accelerated Immigration Timeline

Acquiring a visa without an entity has never been easier, leverage Playroll's global coverage to sponsor and hire employees.

Playroll Visa Services

Hiring International Employees is Complex.

Playroll makes it easy!