Employment contract in South Korea: Template, Key Clauses and Local Law (2026)

The short answer An employment contract in South Korea is governed mainly by the Labor Standards Act (LSA). The law requires an employer to put the core terms in writing and give the employee a copy, sets a 40-hour standard working week with a 52-hour legal maximum, protects annual leave and a weekly holiday, and allows dismissal only for just cause with 30 days' notice or pay in lieu. Statutory retirement (severance) pay of about 30 days' average wages for each year of service applies to most employees with at least one year of service. Get those points right and the contract is on solid ground. ## Is a written employment contract required in South Korea? Yes, in substance. Article 17 of the Labor Standards Act requires the employer to clearly state the main working conditions when the contract is made, including wages (their composition, how they are calculated and how they are paid), contractual working hours, the weekly paid holiday under Article 55, and annual paid leave under Article 60. The employer must deliver a written document setting out wages and these terms to the employee. A written contract, which may be electronic, is therefore the norm and protects both sides in a dispute. ## The local law that governs employment in South Korea The Labor Standards Act is the central statute. Other relevant laws include the Employee Retirement Benefit Security Act (severance and company pensions), the Minimum Wage Act (an annually set minimum wage), and the Act on Equal Employment. The LSA applies in full to businesses with five or more employees, with a reduced set of protections for smaller workplaces, so headcount affects which rules bite. ## Key clauses, with local-law notes Parties and job details. Name the employer entity and the employee, the job title, duties and place of work. Wages. State the amount, the composition (base, allowances, bonuses), the calculation method, the pay date and the payment method. Wages must meet the current statutory minimum wage, which is reset each year. Working hours and overtime. The standard is 8 hours a day and 40 hours a week. Overtime is capped so that total weekly hours, including extended work, do not exceed 52. Overtime, night work and holiday work carry statutory premium pay. Holidays and leave. Provide the weekly paid holiday and annual paid leave. The LSA grants 15 days of annual leave to an employee who has worked for one year with at least 80 percent attendance, increasing with length of service. Term and probation. State whether the contract is indefinite or fixed-term. A probation period, commonly three months, is widely used; it is a matter of agreement rather than a hard statutory cap, and dismissal during probation still needs a reasonable, justifiable ground. Termination. Dismissal requires just cause under Article 23, and Article 26 requires at least 30 days' advance notice or 30 days' ordinary wages in lieu. Spell out notice and grounds carefully, because unfair dismissal claims go to the Labor Relations Commission. Severance (retirement pay). Under the Employee Retirement Benefit Security Act, an employer must provide retirement benefits of at least 30 days' average wages for each year of continuous service to an employee who has worked at least one year (and generally at least 15 hours a week). Reference the applicable retirement benefit or pension scheme. Confidentiality, IP and restrictive covenants. Add confidentiality and assignment-of-inventions clauses. Non-compete clauses are enforceable only if reasonable in scope, duration and area and, in practice, supported by compensation; Korean courts scrutinise them closely. ## A simple template outline 1. Parties and start date

2. Job title, duties and place of work
3. Term (indefinite or fixed) and probation
4. Wages: amount, composition, calculation, pay date and method
5. Working hours, rest and overtime
6. Weekly holiday and annual paid leave
7. Social insurance enrolment (national pension, health, employment, industrial accident)
8. Confidentiality, intellectual property and any restrictive covenant
9. Termination, notice and grounds
10. Retirement benefit or severance arrangement
11. Governing law and dispute resolution Provide the contract in Korean, or bilingually, so the employee genuinely understands the terms. ## Common mistakes and red flags - Not giving the employee a written statement of wages and core terms, as Article 17 requires.

• Writing an overtime or fixed-salary clause that pushes total hours past the 52-hour ceiling.
• Treating probation as a free dismissal period; just cause still applies, only assessed more flexibly.
• A broad non-compete with no compensation and no geographic or time limit, which a court may strike down.
• Forgetting to enrol the employee in the four statutory social insurances.
• Misclassifying an employee as an independent contractor to avoid the LSA; Korean authorities look at the true working relationship, not the label. ## Social insurance, records and dispute resolution Every employer in Korea must enrol employees in the four major social insurances: the National Pension, National Health Insurance, Employment Insurance and Industrial Accident Compensation Insurance. Contributions are shared between employer and employee for most of these, and enrolment is not optional, so budget for it when setting pay. Keep accurate records of hours worked, wages paid and leave taken; these records matter if a claim arises. If an employee disputes a dismissal or a working-condition, the first route is usually the Labor Relations Commission, which can order reinstatement or compensation for unfair dismissal, with the ordinary courts available beyond that. A clear, written contract and good records are the employer's best protection in either forum. ## Language and execution Provide the contract in Korean, or as a Korean and English bilingual document, so the employee genuinely understands the terms; a contract the employee cannot read is weak evidence of agreement. Electronic contracts and electronic signatures are generally recognised in Korea, and the written statement of wages and terms required by Article 17 may be delivered electronically. Keep a signed copy accessible to both sides. ## Keeping it all in one workspace Step back and drafting a contract like this is really several jobs at once: getting the local-law clauses right, keeping your own standard positions consistent, tracking versions as the document is negotiated, and remembering the dates and obligations it creates. When those jobs are spread across a template file, an inbox and someone's memory, things slip, not through carelessness but because the work is scattered. That is the single-workspace idea behind Adira: draft, understand, edit, track and govern a contract in one place, with each clause flagged favourable, neutral or unfavourable to your company and a built-in record of versions and key dates. Adira is India-first today. Support for other jurisdictions, including those in Asia, is on its roadmap rather than at Indian depth now, so for a South Korean contract you would still rely on local counsel for the governing-law detail. The point is the direction: a contract you can see end to end, in one place, is easier to get right and to keep right. ## A note on legal advice This article is general information, not legal advice, and English translations of South Korean statutes are unofficial, with the local-language text controlling. Employment, data and trade-secret rules change, so confirm the current position and have a qualified South Korean lawyer review any contract you intend to sign.