Annual Leave Calculation in Korea: Hire-Date vs. Fiscal-Year Methods Explained

Why Is Annual Leave So Confusing?

Annual leave (연차유급휴가) is a statutory paid leave entitlement under Article 60 of the Labor Standards Act (근로기준법 제60조). Because companies calculate it differently, many workers are unsure exactly how many days they have. There are two main methods — the hire-date basis and the fiscal-year basis (January 1) — and whichever method a company uses, it must not be less favorable to the worker than the statutory minimum.

Note for foreign workers: Your employment contract may specify terms, but they cannot fall below the statutory minimums described below.

1. Workers with Less Than 1 Year of Service: 1 Day Per Month

Workers who have not yet completed one year of service earn 1 day of paid leave for each full month of perfect attendance (Article 60, Paragraph 2 of the Labor Standards Act / 근로기준법 제60조 제2항). Up to 11 days can be accrued over the first 11 months.

Example: Hired March 1, 2026 → 1 day accrues on April 1, another on May 1, and so on.

However, these monthly leave days are deducted from the 15-day entitlement that arises at the one-year mark. If you have used all your monthly leave days during your first year, you may receive no additional days at the one-year anniversary.

2. Workers with 1 or More Years of Service: 15 Base Days + Long-Service Addition

A worker who has maintained an attendance rate of 80% or more over one year is entitled to 15 days of annual leave. For the purpose of calculating the attendance rate, absences due to occupational injury or illness, maternity leave (출산전후휴가), and parental leave (육아휴직) are all counted as days worked (Article 60, Paragraph 6 / 동법 제60조 제6항).

Long-Service Addition (가산 연차)

For workers with 3 or more years of continuous service, 1 additional day is added for every 2 years beyond the first year (Article 60, Paragraph 4 / 동법 제60조 제4항). The maximum entitlement is 25 days.

Years of Service	Annual Leave Days
1 year	15 days
3 years	16 days
5 years	17 days
10 years	19 days
21 years or more	25 days (cap)

3. Key Points When Using the Fiscal-Year Basis

Many companies grant annual leave on a January 1 – December 31 fiscal-year basis for administrative convenience. Under this method, leave for the year of hire is calculated pro rata from the hire date to December 31.

Example: Hired July 1, 2026 → Leave granted for 2026 = 15 days × (6 months ÷ 12 months) = 7.5 days → rounded up or down per company policy.

However, this method must not be less favorable to the worker than the hire-date basis. The Ministry of Employment and Labor's administrative interpretation (근로기준정책과-2855, 2018) instructs that when the fiscal-year basis is used, the entitlement must be recalculated on a hire-date basis at the time of resignation, and any shortfall must be paid out.

4. Expiry of Annual Leave and Leave Allowance

Unused annual leave expires within 1 year of the date it accrued. However, if the employer has not taken the required leave-encouragement measures (사용 촉진 조치, e.g., written notice), the employer must pay an annual leave allowance (연차수당) for any unused days (Article 61 of the Labor Standards Act / 근로기준법 제61조). The allowance is calculated based on ordinary wages (통상임금).

Calculate Your Leave Instantly with Byro

Enter your hire date and length of service to automatically find out your remaining annual leave days and expiry date — use the Byro Annual Leave Calculator. It supports both the fiscal-year and hire-date methods and also shows your estimated unused annual leave allowance.

This article is for informational purposes only and does not constitute legal advice. For specific cases, consult a certified labor attorney (노무사) or lawyer.