Understanding Ordinary Wages in Korea: What Foreign Workers Need to Know
What Are Ordinary Wages (통상임금)?
Ordinary wages (통상임금) form the foundation for calculating your overtime pay, night work allowances, holiday pay, annual leave pay, and severance pay in Korea. Understanding what counts as ordinary wages can significantly impact your total compensation.
The Three Key Requirements
Korean courts define ordinary wages as payments that are:
- Regular (정기성): Paid at consistent intervals
- Uniform (일률성): Paid equally to all workers or those meeting specific conditions
- Fixed (고정성): Guaranteed when you provide labor, without additional conditions
Common Components for Foreign Workers
Meal Allowances: If your employer pays a fixed monthly meal allowance to all employees (not actual meal reimbursements), this typically counts as ordinary wages.
Fixed Bonuses: Regular bonuses like Lunar New Year or Chuseok bonuses usually qualify as ordinary wages. Recent court decisions include bonuses even with "employment on payment date" conditions.
Performance Bonuses: Variable performance pay generally doesn't count, but any guaranteed minimum portion may be included in ordinary wages.
Housing Allowances: Fixed monthly housing allowances typically count as ordinary wages.
Why This Matters for Your Pay
Your overtime rate is calculated as: ordinary wages ÷ 209 hours × 1.5. Higher ordinary wages mean higher overtime pay, night work allowances, and severance pay (퇴직금).
Important Notes for Foreign Workers
- Contract vs. Law: Your employment contract may specify different wage structures, especially in international schools or foreign companies.
- Documentation: Keep detailed records of all salary components and pay stubs.
- Language Support: You can request interpreter assistance when filing complaints with labor authorities.
- Professional Help: Consider consulting a certified labor attorney (노무사) if you suspect wage calculation errors.
Many foreign workers discover they're entitled to additional compensation when ordinary wages are properly calculated.
*This article is for informational purposes only and does not constitute legal advice. For specific cases, consult a certified labor attorney (노무사) or lawyer.