Overtime Pay in Korea: Know Your Legal Rights as a Foreign Worker

Is a Company Allowed to Withhold Overtime Pay?

Have you ever heard "overtime is just part of the job" or "we use an all-inclusive wage system, so extra pay isn't required"? If so, read this article carefully. Overtime pay (야근수당) is not at the company's discretion — it is a worker's right guaranteed by the Labor Standards Act (근로기준법).

Legal Basis for Overtime Pay

Article 56 of the Labor Standards Act (근로기준법 제56조) requires employers to pay a premium of at least 50% of ordinary wages (통상임금) in each of the following three situations:

For example, if a worker earning ₩15,000 per hour works an additional 2 hours after 10:00 p.m., both the extended-work premium (50%) and the night-work premium (50%) apply simultaneously, meaning the worker must receive 200% of the hourly wage — i.e., ₩30,000 — for those 2 hours.

Is "We Use an All-Inclusive Wage System" a Valid Excuse?

An all-inclusive wage system (포괄임금제) is an arrangement in which extended-work, night-work, and holiday-work allowances are bundled into the monthly salary in advance. However, the Supreme Court has ruled that an all-inclusive wage agreement is void if the actual pattern of work is not fixed, or if the all-inclusive amount is less than the statutory allowances (Supreme Court Decision 2016다48785, etc.). In other words, even if a company invokes an all-inclusive wage system, you can claim the shortfall if the amount paid is insufficient relative to your actual overtime hours.

You should also be aware that the premium allowance provisions for extended, night, and holiday work do not apply to workplaces with fewer than 5 employees. However, for workplaces with 5 or more employees, the rules apply without exception regardless of industry or job type.

Note for foreign workers: Check your employment contract — contractual terms may differ from the statutory minimum, but they cannot fall below it.

Not Receiving Overtime Pay? A Step-by-Step Response

Step 1: Gather Evidence
Collect as much documentation as possible: access-card records showing your departure time, work-messenger logs, email timestamps, receipts for late-night meal allowances, etc. The statute of limitations on wage claims is 3 years under Article 49 of the Labor Standards Act (근로기준법 제49조), so you can claim retroactively for up to 3 years.

Step 2: Submit a Written Request to the Company
Rather than making a verbal request, send an email or text message stating something like: "I am requesting payment of extended-work allowances for the period from [date] to [date]." This creates important evidence in the event of a later dispute.

Step 3: File a Complaint with the Ministry of Employment and Labor
If the company does not respond, you can file an unpaid-wages complaint (임금체불 진정) with the regional office of the Ministry of Employment and Labor (고용노동부 지청) that has jurisdiction over the workplace. Once the complaint is accepted, a labor inspector will investigate. If the employer refuses to pay the allowances, they may face imprisonment of up to 3 years or a fine of up to ₩30 million under Article 109 of the Labor Standards Act (근로기준법 제109조).

How Much Overtime Pay Are You Owed?

Calculating overtime pay is more complex than it might seem, because it starts with determining your ordinary wages. Whether fixed allowances such as meal allowances or position allowances are included in ordinary wages can significantly affect the total amount.

You can use the Bylaw (바이로, workbylaw.com) annual net salary calculator to quickly check your ordinary wage basis. The AI search feature can also instantly answer questions about the validity of all-inclusive wage agreements and how premium allowances are calculated. If you are unsure how to draft a complaint, try Bylaw's complaint-drafting assistant as well.

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