Dismissed from a Small Workplace (Under 5 Employees) in Korea? Know Your Rights – 2026 Guide

How Much Protection Do Workers at Workplaces with Fewer Than 5 Employees Have Against Dismissal?

Workers at small workplaces—convenience stores, small cafés, neighborhood restaurants—with fewer than 5 employees make up a significant portion of all wage workers in Korea. Yet when they are dismissed, a common question is: "Am I not protected by law?" The short answer is: some protections do not apply, but there are still important rights that remain in force.

Note for foreign workers: Your employment contract may provide terms more favorable than the statutory minimums described below. Always check your contract alongside these legal rights.

Dismissal Protections That Do NOT Apply to Workplaces with Fewer Than 5 Employees

The Labor Standards Act (근로기준법) varies in scope depending on the regular number of employees. The following provisions do not apply to workplaces with fewer than 5 employees.

• Prohibition on dismissal without just cause — Article 23 of the Labor Standards Act (근로기준법 제23조): At workplaces with 5 or more employees, an employer cannot dismiss a worker without just cause. Workplaces with fewer than 5 employees are not subject to this provision, meaning employers have comparatively broad discretion to dismiss workers.
• Unfair dismissal (부당해고) relief claim — Article 28 of the Labor Standards Act (근로기준법 제28조): The right to file an unfair dismissal relief claim with the Labor Relations Commission is also recognized only at workplaces with 5 or more employees. Workers at workplaces with fewer than 5 employees cannot use this procedure.

In other words, if you wish to contest a dismissal at a workplace with fewer than 5 employees, you must do so by filing a civil lawsuit in court seeking a declaration that the dismissal is void.

Dismissal-Related Rights That ALWAYS Apply, Regardless of Workplace Size

That said, workers at small workplaces are not left entirely without protection. The following rules apply regardless of the number of employees.

1. Advance Dismissal Notice and Advance Notice Pay (해고예고수당) — Article 26 of the Labor Standards Act (근로기준법 제26조)

An employer who intends to dismiss a worker must give at least 30 days' advance notice. If the employer fails to give 30 days' notice, the employer must pay at least 30 days' ordinary wages as advance notice pay (해고예고수당).

However, the advance notice obligation is waived in the following cases (proviso to Article 26 of the Labor Standards Act):
- The worker is a daily worker who has not been continuously employed for 3 months.
- The worker was hired for a fixed period of 2 months or less.
- The worker is a monthly-paid employee who has been employed for less than 6 months.
- It is impossible to continue the business due to a natural disaster, emergency, or other unavoidable cause.
- The worker has deliberately caused serious disruption to the business or inflicted property damage.

2. Severance Pay (퇴직금) — Article 4 of the Act on the Guarantee of Workers' Retirement Benefits (근로자퇴직급여 보장법 제4조)

Any worker who has been continuously employed for 1 year or more and works an average of 15 or more hours per week is entitled to severance pay regardless of workplace size. Severance pay must be paid within 14 days of the date of retirement; if payment is delayed, late-payment interest of 20% per annum accrues (Article 17 of the Enforcement Decree of the Labor Standards Act / 근로기준법 시행령 제17조).

As of 2026, the minimum wage is 10,320 won per hour (2,156,880 won per month). Workers employed at the minimum wage level must use this figure as the basis for calculating severance pay.

3. Filing a Complaint for Unpaid Wages

If wages or severance pay remain unpaid after dismissal, you can file a complaint (진정) with the Ministry of Employment and Labor (고용노동부) regardless of workplace size.

Practical Response Checklist

If you have been dismissed from a workplace with fewer than 5 employees, take the following steps in order:

1. Secure evidence: Save your employment contract, pay stubs, attendance records, and any dismissal notices sent by text message or KakaoTalk.
2. Check advance notice pay: If you were dismissed without 30 days' notice, claim advance notice pay.
3. Calculate severance pay: If you worked for 1 year or more, be sure to claim your severance pay.
4. File a complaint with the Ministry of Employment and Labor: If wages or severance pay have not been paid, file a complaint with the competent regional Employment and Labor Office.
5. Consider a civil lawsuit: If you wish to contest the validity of the dismissal itself, consult a certified labor attorney (노무사) or lawyer and consider filing a lawsuit.

Calculate Your Entitlements at Workbear

To calculate your severance pay immediately, use the severance pay calculator at Workbear (workbear.kr). Enter your period of employment and average wage to get an instant estimate. For issues such as unpaid advance notice pay or wage arrears, you can use the AI search and complaint-drafting features to find out how to respond.

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