What Is the Minimum Wage in South Korea?
Discover South Korea's minimum wage framework, including its annual determination, broad application, and enforcement.
The minimum wage is a fundamental economic policy to ensure workers receive fair compensation, establishing a baseline income. In South Korea, this system plays a significant role in safeguarding the livelihoods of employees and contributing to the overall economic stability of the nation. It aims to balance the needs of workers with the financial considerations of businesses, fostering a productive and equitable work environment. This policy helps prevent exploitation and supports a decent standard of living for the workforce.
Current Minimum Wage Rate
As of January 1, 2025, the minimum wage in South Korea is set at 10,030 Korean Won (KRW) per hour. This rate represents an increase from the previous year, reflecting ongoing adjustments to economic conditions. For a full-time employee working 209 hours per month, this translates to a monthly minimum wage of approximately 2,096,270 KRW.
The calculation of the minimum wage includes basic pay. However, certain components are excluded from this calculation base, such as overtime pay, bonuses not directly tied to work performance, and allowances provided for living or welfare purposes. Paid rest hours are factored into the total working hours when determining the hourly minimum wage.
Determining the Minimum Wage
The minimum wage in South Korea is determined annually by the Minimum Wage Commission under the Ministry of Employment and Labor. This commission is comprised of 27 members, with equal representation from labor, management, and public interest groups. This tripartite structure aims to ensure a balanced consideration of various perspectives during wage negotiations.
The annual process begins March 31, when the Minister of Employment and Labor requests the Commission to review the minimum wage. The Commission then deliberates, considering factors such as the cost of living for workers, the wage levels of comparable employees, national labor productivity, and the distribution of income. A proposal is submitted by June 29, and the final rate announced by August 5, taking effect on January 1 of the following year.
Scope of Application
The minimum wage law in South Korea applies to all businesses and workplaces, regardless of size. It covers all employee types: full-time, part-time, temporary, and foreign workers, ensuring a consistent wage floor across the labor market. This creates an equitable standard for compensation for the working population.
Some specific exceptions exist. Apprentices employed for a period shorter than three months may be subject to a reduced wage, 90% of the standard minimum wage. Similarly, during the first three months of a probationary period for a contract of one year or more, employers may pay 90% of the minimum wage. Family members living with the employer or domestic workers are generally not covered. The application of minimum wage to emerging categories like platform and gig workers is currently under review, with these workers currently excluded, with coverage under review for 2026.
Compliance and Enforcement
Employers in South Korea must pay employees at least the minimum wage. They must also inform employees of the current minimum wage rate, such as by displaying it prominently in the workplace. Any employment contract provision that specifies a wage lower than the statutory minimum wage is null and void; the employee must still be paid the legal minimum.
The Ministry of Employment and Labor oversees compliance with minimum wage laws through regular inspections and guidance. Violations of the minimum wage act can lead to penalties for employers. Failure to pay the minimum wage can result in imprisonment for up to three years or a fine not exceeding 20 million KRW, or both. Failing to inform employees about the minimum wage can incur an administrative fine of up to 1 million KRW. Labor inspectors enforce these regulations and address complaints.