Annual Leave in Korea: How It Actually Accrues

Annual leave in Korea is not a benefit an employer grants. Where the Labor Standards Act applies, it arises by statute, and the employer’s discretion is limited to timing — not to whether it exists.

But “where the Act applies” is doing real work in that sentence, and it is the part most explanations skip.

Check the headcount before you calculate anything.

The workplace gate

Statutory annual leave applies at workplaces with five or more ordinary employees.

Below that, there is no statutory leave to compute. What there may be is a contractual entitlement — if the employment contract or the workplace rules promise paid leave, that promise binds on its own terms.

The hours gate

Article 18(3) disapplies the annual leave provisions where contractual working hours average under 15 a week over four weeks — the same 15-hour threshold that governs weekly holiday pay and statutory severance.

Measured on contractual hours, not on the hours a given week produced. A 14-hour contract is outside; a 20-hour contract with one quiet week is not.

After one year: 15 days, and when they arrive

An employee who attends 80% or more over one year receives 15 days.

The timing catches people. The 15 days are not granted on your first day and they are not granted during the year — they arise once the year of work is complete.

Seniority adds a day every second year, not every year

From three years of continuous service, one day is added for each two years of service beyond the first — capped at 25 days including the addition.

Not one more day every year from year three. One more day every second year.

The first year: one day per completed month

Before the first year is complete, an employee earns one day for each month worked without absence, up to 11 days.

Start on 1 September and a month without absence produces a day on 1 October, another on 1 November, and so on.

The first-year days all expire on the same date

This is where most first-year leave is lost.

The eleven days are not each usable for a year from the day they accrued. Article 60(7) sets the usable period as running until the end of the first year of employment — one shared deadline.

hired 1 January 2026
  → day accrued 1 February 2026   usable until 31 December 2026
  → day accrued 1 November 2026   usable until 31 December 2026

Eleven months of life for the first, weeks for the last. Anyone planning to “save them up” is planning around a rule that no longer exists.

Where the employee could not use the leave through the employer’s fault, the ordinary lapse rule does not simply apply.

Attendance is not a door-record calculation

The 80% figure is not computed from raw attendance. Several periods are counted as attendance, including:

• absence from work due to an occupational injury
• statutory maternity leave before and after childbirth
• parental leave
• reduced working hours for childcare, and certain reduced hours in pregnancy

Timing: yours to choose, with a narrow exception

The employer must grant leave at the time the employee requests. Where granting it at that time would cause serious disruption to the business, the employer may change the timing.

So a policy of “leave may only be taken on days the company designates” does not match the structure of the Act. Nor, in the other direction, can an employee unilaterally fix any date in any circumstances — the timing-change right is real, it is simply narrow.

Unused leave becomes a payment claim

Leave not used within its statutory period lapses as leave. Absent a valid use-promotion procedure and absent employer fault, that is not the end of it: the claim for unused-leave pay is treated as arising the day after the leave right lapses.

leave right lapses
  → the following day, a claim for payment arises

Losing the ability to take the day is not the same as losing the money for it.

The payment is not automatically eight hours

Where the workplace rules provide nothing else, the usual basis is the ordinary wage for the last month in which the leave could have been claimed:

unused days × daily contractual hours × hourly ordinary wage

At an hourly ordinary wage of ₩15,000, five unused days and eight contractual hours a day:

₩15,000 × 8 × 5  =  ₩600,000

Two ways that goes wrong:

So the calculation runs base pay → fixed allowances → which of them are ordinary wage → monthly ordinary wage → hourly ordinary wage → the daily figure. Computing from base pay alone understates the result, quietly and every time.

Where the workplace rules instead specify average wage for leave periods, that provision has to be read alongside. How the components appear on the payslip in the first place is in reading your Korean payslip.

Leaving with leave on the books

The relationship ends, so the leave can no longer be taken. Days already accrued and unused convert into a payment question, and it lands inside the same 14-day settlement window as the rest of the exit — set out in Korean severance pay, which also covers the separate question of when an unused-leave payment does and does not enter the average wage.

Where a valid use-promotion procedure has already extinguished the leave, the analysis is different. That procedure is the subject of its own guide, because it is the one part of this that changes who owes money.

Being foreign changes none of it

None of the following is a rule:

• no annual leave in the first year
• no annual leave on a fixed-term contract
• no 15 days because the visa runs a year
• unused leave simply disappears

Entitlement turns on continuous service, contractual hours, workplace size and attendance. Nationality is not an input. The one case genuinely worth separate attention is the exactly-one-year contract, where the moment the 15 days arise and the leaving date sit next to each other.

What to record, if you are the one keeping the numbers

A leave balance is not a number. “8 days remaining” is unauditable.

basis for the accrual
  → accrual date
  → usable period
  → dates taken
  → remaining
  → first promotion notice, and its date
  → the employee's reply, and its date
  → employer designation, and its date
  → the date unused-leave pay arose

And keep the first-year eleven and the subsequent fifteen in separate ledgers, because their expiry dates and their promotion timetables are not the same. Running one schedule across both is the single most common way a company ends up owing money it believed it had extinguished.