South Korea: Operating a business

Legal Forms of Companies

Yuhan Hoesa: Private Limited Company: Number of partners: Minimum one, maximum fifty partners.
Capital (max/min): No minimum capital.
Shareholders and liability: Liability is limited to the amount contributed.
Jusik Hoesa: Public Limited Company: Number of partners: One or more partners.
Capital (max/min): No minimum capital.
Shareholders and liability: Liability is limited to the amount contributed.
Hapja Hoeasa: Limited Partnership: Number of partners: Two or more partners.
Capital (max/min): No minimum capital.
Shareholders and liability: Liability of active partners is unlimited. Liability of sleeping partners is limited to the amount contributed when they do not take part in the company management.
Hapmyong Hoesa: General Partnership: Number of partners: Two or more partners.
Capital (max/min): No minimum capital.
Shareholders and liability: Liability is unlimited.
Yuhan Chegim Hoesa: Limited Liability Company: Number of partners: One or more partners.
Capital (max/min): No minimum capital.
Shareholders and liability: Each member’s liability limited to the amount of contributed capital

Setting Up a Company	South Korea	OECD
Procedures (number)	3.00	5.21
Time (days)	8.00	9.47

Source: The World Bank - Doing Business, Latest data available.

The Competent Organisation: The Supreme Court
For Further Information: Doing Business: South Korea, to learn about procedures to start a business in South Korea
Korea Business Central

Dan & Bradstreet - South Korea business directory

Dun & Bradstreet - Worldwide directory with financial information on businesses

Kompass - South Korea Business Directory

Principle: The insolvency of a company does not immediately lead to bankruptcy or liquidation. There is a reorganisation proceeding and a liquidation proceeding.

The reorganisation proceedings seek to maintain or rehabilitate a company under the supervision of a court; this is done by adjusting the claims and equities of those involved (for instance, creditors).
Minimum Debt-to-Capital Ratio Triggering Liquidation: None
Bankruptcy Laws: Reorganisation and Debtor Liquidation Act (also called Debtor Rehabilitation and Bankruptcy Act).
Reorganization and Rehabilitation Laws: Reorganization and Debtor Liquidation Act (also called Debtor Rehabilitation and Bankruptcy Act).

	2018	2019	2020
Labour Force	28,303,251	28,541,664	28,348,936

For Further Statistics: Korea National Statistical Office
For Further Information About the Labour Market: National Labour Relations Commission (NLRC)
Human Resources Development Service of Korea

Working Rest Day: According to the labor standard law, employees should have one day off for every week of work, or alternatively, 4 days off for every 4 weeks of work.
Paid Annual Vacation: 15~25 days.
15 days for 1-year consecutive service, with 2 additional days for each year of service.
1 day per month for those with a service period of shorter than 1 year
Retirement Age: 60 years in most companies and public institutions; discussions are underway to raise it to 65. Access to the national pension begins at 65.
Child Labour and Minimum Age For Employment: 15 years

Minimum Wage: The national statutory minimum wage is KRW 10,320 per hour (approx. KRW 2,156,880 - USD 1,490 - monthly based on 209 hours), set by the Minimum Wage Council under the Ministry of Employment and Labor of the Republic of Korea and effective from 1 January 2026.
Average Wage: In South Korea, the average yearly salary translates to approximately ₩47,145,828 Korean won (KRW). This is equal to around $35,786 USD.
Other Forms of Pay
Pay For Overtime: 50% more than regular wages. However, a 25% remuneration rate applies for the first four hours of overtime temporarily, for the first three years.
Pay For Rest Days Worked: 50% more than regular wages.
Pay For Night Hours: 50% more than regular wages.
Pay For Overtime at Night: 50% more than regular wages.

The Areas Covered: Health insurance, national pension, employment insurance, industrial accident insurance.
Contributions: Contributions Paid By the Employer: •   National Pension: 4.5% (National pension contribution is capped at a monthly salary of KRW 5,240,000)
•   Health Insurance: 3.924% (currently capped at a monthly contribution of KRW 8,203,680 in total)
•   Employment Insurance: from 1.05% to 1.65% (1.15% to 1.75% starting from July 2022), depending on the number of employees and type of industry.
•   Worker’s Compensation Insurance: 0.73% to 18.63% depending on the industry
Contributions Paid By the Employee: •   National Pension: 4.5% (National pension contribution is capped at a monthly salary of KRW 5,240,000)
•   Health Insurance: 3.924% (currently capped at a monthly contribution of KRW 8,203,680 in total)
•   Employment Insurance: 0.80%
Competent Organization: Social Insurance Information System
Ministry of Labor

Recruitment Agencies: Public Employment Offices: HRD Korea (Human Resources Development Service of Korea),
Private Human Resources Firms: HR Korea, Adecco Korea, Korn/ Ferry International Korea , Incruit Corp.
Recruitment Websites: Human Resources Development Service of Korea

Type of Contract: Employment contracts determine if the employee is part of the regular or non-regular staff. Permanent employees form the regular staff. Among the non-regular staff, there are different types of contract: part-time workers, temporary workers, dispatched workers, fixed-term contract workers and entrusted employees.

Labour Laws: Trade Union and Labor Relations Adjustment Act
Doing Business: South Korea, to obtain a summary of labour regulations that apply to local entreprises

Legal Framework: Trade Union and Labor Relations Adjustment Act
Competent Legal Body: One National Labor Relations Commission and 12 Regional Labor Relations Commissions in major cities and provinces.
Labor-management experts (labor tribunal lay members).

Social Dialogue and Involvement of Social Partners: Union negotiations in South Korea take place at the national level, the sector level or the company level.
Unionisation Rate: 10.1% in 2012.
Regulation Bodies: Ministry of Labour

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