South Korea’s annual leave system — yeoncha yugeup hyuga (연차유급휴가) — looks straightforward on paper: 15 days a year. In practice it is one of the more nuanced statutory frameworks in APAC. New hires accrue leave by the month, long-tenured employees pick up extra days every two years, and employers carry an explicit duty to encourage leave to actually be used. Get any of these moving parts wrong and the unpaid-wage exposure on termination adds up quickly.

This guide walks through Articles 60 and 61 of the Labor Standards Act (Geunro Gijun Beop), who qualifies, how the 80% attendance test works, the employer’s annual leave promotion obligations, and the pitfalls that most often catch foreign-owned employers and smaller Korean SMEs.

Key Takeaways

The statutory entitlement is 15 days of paid annual leave after one year of continuous service with at least 80% attendance.
Employees with less than one year of service accrue one day per month worked.
Long-service employees earn one additional day for every two years of service after three years, capped at 25 days total.
Annual leave is paid at the employee’s average wage (looking back over the three months before the leave is taken).
Unused leave generally expires after one year, but if the employer prevented the employee from taking it, it must be paid out.
Annual leave provisions apply to workplaces with 5 or more employees.

Statutory Entitlement Under Article 60

Article 60 of the Labor Standards Act sets the minimum paid annual leave for every covered employee in South Korea. The structure has three layers: a monthly accrual in the first year, a base 15-day grant from year two, and a long-service top-up that gradually increases the entitlement to a 25-day cap.

The 15-Day Base Entitlement

After completing one full year of continuous service with at least 80% attendance, an employee is entitled to 15 days of paid annual leave for the following year. The 80% test looks at attended working days against scheduled working days during the qualifying year. An employee who falls below 80% in a given year receives the monthly accrual instead — one day per month they actually worked.

Monthly Accrual in the First Year

For employees who have not yet completed one year of service — or whose attendance dipped below 80% — Article 60(2) provides one day of paid annual leave for each full month worked. A new hire who has been with the company for seven months has accrued seven days of leave under the monthly rule, available to take or to be paid out on termination.

This creates a small overlap that is easy to miscalculate. When the employee crosses the one-year service mark and qualifies for the 15-day grant, any monthly leave they already took during the first year is deducted from the 15 days — the totals don’t stack on top of each other for the same period.

Long-Service Additional Leave

Article 60(4) adds an extra day for every two years of continuous service beyond three years. The progression looks like this:

Years of continuous service	Annual leave entitlement
1 year	15 days
3 years	16 days
5 years	17 days
7 years	18 days
9 years	19 days
11 years	20 days
21 years and above	25 days (statutory cap)

The entitlement is paid at the employee’s average wage, calculated under the Labor Standards Act as total wages over the three months preceding the leave divided by the number of calendar days in that period. Regular allowances and bonuses paid during the lookback window are included.

Eligibility: Who Qualifies for Yeoncha Hyuga

Annual leave under Article 60 applies to workplaces with five or more employees. Workplaces below that threshold are outside the scope of Article 60 (although other parts of the Labor Standards Act still apply). For covered workplaces, eligibility depends on:

Employment status — full-time, part-time, and fixed-term employees all qualify. Part-time employees receive a pro-rated entitlement based on their contracted hours and days.
Length of service — full 15-day entitlement requires one completed year. Below that, the monthly accrual rule applies.
Attendance — at least 80% of scheduled working days during the qualifying year for the 15-day grant.

If you operate elsewhere in APAC, the South Korean rules sit between Japan and Singapore in strictness. For comparison, see our breakdown of annual leave entitlement in Japan, where leave starts at 10 days after six months and tops out at 20, and annual leave entitlement in Singapore, where the statutory floor is just seven days after the first year.

Employer Obligations Under Articles 60 and 61

The Labor Standards Act puts a clear set of duties on employers — and Article 61 in particular makes the employer responsible for actively encouraging leave to be used.

Granting and Paying Leave Correctly

Employers must:

Grant the statutory entitlement (monthly accrual, 15 days, plus any long-service additions) to every eligible employee.
Pay the employee’s average wage during annual leave.
Allow the employee to choose the timing of leave, subject to operational requirements.
Not discourage employees — directly or indirectly — from taking annual leave.
Maintain accurate records of accrued and used leave per employee.
Pay out any unused balance on termination of employment.

The Annual Leave Promotion System (Article 61)

Article 61 introduces the annual leave promotion system (yeoncha yugeup hyuga sayong chokjin jedo). It is the South Korean equivalent of an employer-led “use it or lose it” mechanism, and it works on a strict timeline:

Six months before the leave year ends, the employer notifies each employee in writing of the unused balance and asks them to designate when they will take it.
The employee must respond within 10 days with proposed dates.
If the employee does not propose dates, the employer can — at least two months before the leave year ends — designate specific dates in writing for the remaining balance.

If the employer follows the Article 61 procedure correctly and the employee still does not take the leave, the employer is released from the obligation to pay for the unused days when they expire. If the employer skips or botches any step of the procedure, the unused leave does not lawfully expire — and the employer must pay it out.

Termination Payouts

When employment ends, all unused annual leave must be paid out at the employee’s average wage. This applies to leave accrued under the monthly rule, the 15-day grant, and the long-service additions. There is no statutory mechanism to forfeit accrued leave at termination, regardless of how the employment ends.

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Common Pitfalls for Employers in South Korea

The combination of monthly accrual, an annual grant, a long-service top-up, and a procedural promotion system creates several recurring failure modes. Foreign-owned employers running on payroll systems built for other jurisdictions are particularly exposed.

1. Skipping Monthly Leave for First-Year Employees

The most common error is treating annual leave as a year-two benefit only. Article 60(2) is unambiguous: every full month of service in the first year creates one day of paid leave. Employees who resign or are terminated during their first year are entitled to be paid out the days accrued under this rule. Payroll systems that only schedule the 15-day grant after the first anniversary will routinely under-pay first-year leavers.

2. Forgetting the Long-Service Additions

After three years of service, the entitlement begins to grow. By year 11, the employee should be on 20 days; by year 21, the statutory cap of 25 days kicks in. HRIS platforms imported from markets without this kind of seniority-based escalation often freeze the entitlement at 15 days, creating a slow-burning liability that surfaces at termination.

3. Using the Promotion System Incorrectly

Article 61 only protects the employer if every procedural step is followed: the six-month notice, the ten-day window for the employee to designate dates, and the two-month employer designation. Verbal reminders, an internal Slack message, or a single notice late in the year do not satisfy the rule. Companies that “did promotion” but cannot produce the written records lose the defence and have to pay out the lapsed leave.

4. Paying Leave at the Wrong Rate

Annual leave is paid at the average wage over the preceding three months, not just basic salary. Regular allowances, fixed bonuses, and other recurring payments fall inside the calculation. Excluding them produces a structural underpayment on every annual leave day taken — and on every termination payout.

5. Not Paying Out Unused Leave on Termination

Termination payout is statutory. Forfeiture clauses in contracts cannot override Article 60. Employers occasionally try to net unused leave against notice or other items in dispute; the Ministry of Employment and Labor treats accrued leave as wages for the purposes of unpaid-wage claims.

For payroll teams managing leave across multiple countries, see our guidance on tracking accrued leave correctly — the principles map cleanly to South Korea’s average-wage rule.

Frequently Asked Questions

How many days of annual leave do employees get in South Korea?

Employees with at least one year of continuous service and 80% attendance receive 15 days of paid annual leave per year under Article 60 of the Labor Standards Act. Employees with less than one year of service — or whose attendance dipped below 80% — accrue one day per month worked. After three years of service, employees earn one additional day for every two completed years, up to a statutory cap of 25 days.

What is the 80% attendance rule?

Employees must have attended at least 80% of working days during the leave year to qualify for the full 15-day entitlement the following year. Employees below the 80% threshold receive the monthly accrual instead. Statutorily protected absences — for example, maternity leave or work-related injury leave — are generally treated as attended days for this calculation.

Can annual leave be carried forward in South Korea?

Unused annual leave generally expires one year after it accrues. If the employer prevented the employee from taking the leave, or failed to follow the Article 61 promotion procedure, the leave does not lawfully expire and the employer must pay it out at the average wage.

Are part-time employees entitled to annual leave?

Yes. Part-time employees in workplaces with five or more employees are entitled to annual leave on a pro-rated basis — the entitlement is calculated against contracted working hours and days relative to a comparable full-time employee.

Does the law apply to small workplaces?

Article 60 applies to workplaces with five or more employees. Workplaces below that threshold sit outside the annual leave provisions, although other parts of the Labor Standards Act — minimum wage, working hour limits, and so on — still apply.

How Leave Balance Helps

Tracking monthly accrual in year one, the 15-day grant from year two, the two-yearly long-service addition, and the Article 61 promotion procedure across every employee is real operational work — particularly for foreign-owned employers running on payroll systems built for other jurisdictions.

Leave Balance handles the entire workflow. You can configure South Korea-specific accrual schedules, the 80% attendance test, the long-service escalation, and the leave-promotion notice cycle per employee. Approvals run through Slack or Microsoft Teams where your team already works, and the audit trail captures the written notices required by Article 61. Pricing is a flat USD $10/month — not per employee — so the cost stays the same whether your Seoul office has 5 people or 500.

For broader context on how annual leave fits alongside sick leave, parental leave, and statutory holidays, see our overview of the main types of leave employers manage.