1. Retirement
① Settlement of Payments
When an employee dies or retires, the employer shall pay wages, compensation, and other money or valuables within fourteen days of the day on which the cause of such payment occurred.
② Issuance of Certificate of Employment
Whenever an employer is requested by an employee to issue a certificate Obligation of Foreign Employees to Subscribe to the four major Insurances Foreign employees must subscribe to
national health insurance (application for exclusion from subscription can be filed if certain requirements are met) and industrial accident compensation insurance, as is the
case of their Korean counterparts, while employment insurance can be subscribed to arbitrarily, depending on residency qualifications and nationality.
Subscription to national pension varies by nationality, depending on reciprocity.
In Detail
immediately prepare and deliver a certificate based on facts, even after the retirement of the employee. The certificate shall contain nothing other than what has been requested by the employee.
2. Severance Pay System
① Types
Severance pay refers to an annuity or lump sum paid to workers who provided consecutive service during a number of years. There are two types of retirement pension reserves-severance pay and retirement pension plan.
② Severance Pay System
It is a system established to pay a retiring worker a pro-rated amount equivalent to or more than the average wage earned for 30 days for each year of his/her continuous service by his/her employer.
③ Retirement Pension Plan
The defined benefit retirement pension system (DB), defined contribution retirement pension system (DC) and personal retirement pension (IRP) are defined as a system in which the user reserves the funds of retirement benefits to outside financial institutions and pays the reserve as pension or a lump sum upon retirement. When subscribing to a retirement pension, the employee can safely receive the severance pay without fear of defaulting after leaving the company, and the user can save tax because the paid reserves are recognized as deductible expenses under the Corporate Tax Act.
- Defined Benefit Plan (DB) : Retirement benefits shall be multiplied by the length of time (years of service) in which the work is provided in excess of the average wage of thirty days per year. The level of retirement benefits to employees will be determined in advance.
- Defined Contribution Plan (DC) : A twelfth of a subscriber’s annual wages or more should be paid as contribution to the subscriber's account.
The contribution of the employer is determined in advance.
- Individual Retirement Pension Plan(IRP) : This is a retirement pension plan established to accumulate and operate the lump sum paid
Introduction of the Retirement Pension System An employer is required to set a retirement pension plan within one year of the establishment of the business ; otherwise, such employer shall be deemed to have established a retirement allowance system.
There is no punishment regulation for
however, the employer who fails to pay retirement benefit or retirement allowance shall be punished by imprisonment for not more than three years or by a fine not exceeding KRW 20 million.
Article 5, 11 of the Act on the Guarantee
In Detail
by a participant or the contributions paid by an employer or a participant according to the participant's choice in which the amount of the benefits or contributions is not predetermined.
Dismissal
1. Justification of Dismissal
Dismissal refers to the termination of a working relationship against the will of an employee. An employer shall not, without justifiable cause, dismiss, lay off, suspend, or transfer an employee, reduce his/her wages, or take other punitive measures against him/her.
① Disciplinary Dismissal : This refers to the termination of working relationship in a disciplinary form where employer and employee cannot continue to maintain their working relationship. The institution comprehensively evaluates various circumstances, including disciplinary purposes, business characteristics, workers' duty, non-compliance, and their impact on the corporate order.
② Dismissal for Managerial Reasons : This refers to the termination of a working relationship based on urgent managerial needs in order to maintain the existence of a company for management. An employer shall make every effort to avoid dismissal and shall establish and follow reasonable and fair criteria for the selection of those persons subject to dismissal and inform them at least fifty days before the intended date of dismissal and consult in good faith with the labor union.
2. Advance Notice of Dismissal
When an employer intends to dismiss an employee (including dismissal for managerial reasons), he/she shall give the employee a notice of dismissal at least thirty days in advance of such dismissal. If the employer fails to give such advance notice, he/she shall pay such employee a minimum of thirty days' ordinary wage.
3. Written Notice for Dismissal
When an employer intends to dismiss an employee, the dismissal shall become effective only upon a written notice of grounds and timing for the dismissal.
4. Restriction on Dismissal
An employer shall not dismiss an employee during a period of suspension of work for medical treatment of an occupational injury or disease and within thirty days immediately thereafter. No woman shall be dismissed before or after during a period of suspension of work guaranteed by law and for thirty