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Severance Payment

 
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kcmo



Joined: 24 Nov 2011

PostPosted: Sun Feb 03, 2013 8:09 am    Post subject: Severance Payment Reply with quote

I signed on for another year at my hagwon, and it says in my contract: "When the Employee completes the contract without breaking the contract, the Employer must pay a severance payment equal to one month’s salary. If the Employee does not complete the contract then this payment would not given."

So I should still receive that severance payment even though I am staying for another year right? My contract for next year will be starting in a couple weeks so I should receive the payment at that time I guess?
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newb



Joined: 27 Aug 2012
Location: Korea

PostPosted: Sun Feb 03, 2013 2:29 pm    Post subject: Re: Severance Payment Reply with quote

kcmo wrote:
I signed on for another year at my hagwon, and it says in my contract: "When the Employee completes the contract without breaking the contract, the Employer must pay a severance payment equal to one month’s salary. If the Employee does not complete the contract then this payment would not given."

So I should still receive that severance payment even though I am staying for another year right? My contract for next year will be starting in a couple weeks so I should receive the payment at that time I guess?


No, you will get it only when you quit your job with current employer.
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schwa



Joined: 18 Jan 2003
Location: sokcho

PostPosted: Sun Feb 03, 2013 3:44 pm    Post subject: Reply with quote

Thats right. A new law last year voided that contract stipulation.
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Porksta



Joined: 05 May 2011

PostPosted: Sun Feb 03, 2013 5:26 pm    Post subject: Reply with quote

So if I work for two years is that two severance payments?
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ttompatz



Joined: 05 Sep 2005
Location: Kwangju, South Korea

PostPosted: Sun Feb 03, 2013 5:32 pm    Post subject: Reply with quote

Porksta wrote:
So if I work for two years is that two severance payments?


On retirement from your employer you are entitled to a payment of 1 month's salary for every full year worked.

[Labor Standards] Employee Retirement Benefit Security Act:
(replacing Article 34 of the labor standards act)

ministry of labor wrote:
Article 8 (Establishment, etc., of Retirement Pay System)
(1) An employer who intends to set up a retirement pay
system shall set up the system that makes it possible to pay a
retiring worker 30 days or more of the average wages for each
year of his/her consecutive service as retirement pay.
(2) Notwithstanding paragraph (1), an employer may, if a
worker requests the payment for any of the reasons prescribed
by the Presidential Decree, such as housing purchases, etc., pay
the worker the amount of retirement pay corresponding to
his/her consecutive service period earlier than his/her
retirement. In such cases, the consecutive service period to be
used for the calculation of the amount of retirement pay
accumulated thereafter shall be reckoned anew from the time
when the balances are settled.


.
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oppa637



Joined: 05 Dec 2011

PostPosted: Sun Feb 03, 2013 5:33 pm    Post subject: Reply with quote

You won't receive it till you quit. If you work 2 years, you will get 2 months pay when you leave. 1 year = 1 month pay and prorated after the first year.
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Porksta



Joined: 05 May 2011

PostPosted: Sun Feb 03, 2013 6:20 pm    Post subject: Reply with quote

oppa637 wrote:
You won't receive it till you quit. If you work 2 years, you will get 2 months pay when you leave. 1 year = 1 month pay and prorated after the first year.


Prorated? So if I work one year and three months I get 1.25 months severance?
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cincynate



Joined: 07 Jul 2009
Location: Jeju-do, South Korea

PostPosted: Mon Feb 04, 2013 1:53 am    Post subject: Reply with quote

Quote:
Prorated? So if I work one year and three months I get 1.25 months severance?


Yes.. If you work less than one year you get nothing. But anything over a year is 1month for each year worked, prorated.

So if you work 1 year and 3 months you get a severance payment equal to the average of your last three months salary *1.25. So if you got a raise, it will raise your entire severance Smile
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Dodge7



Joined: 21 Oct 2011

PostPosted: Mon Feb 04, 2013 2:13 am    Post subject: Reply with quote

I always wondered about that severance money before they give it to you.
Where does that money come from? Do they skim it off your paychecks each month or do they pay you from their own pockets?
And I also wonder if they put some money aside each month for you (maybe in a separate bank accnt.) so it's always on hand in case you quit and they need to give it to you, or do they scramble to come up with it once you finish working for them.
Anyone know?
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schwa



Joined: 18 Jan 2003
Location: sokcho

PostPosted: Mon Feb 04, 2013 2:21 am    Post subject: Reply with quote

Theoretically, they're meant to put it in a dedicated account. I believe thats what public schools do. Hagwons, who knows.
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