Do businesses with fewer than 5 employees have to pay weekly holiday pay?
Yes, you do. Even a shop with fewer than 5 employees must pay weekly holiday pay (juhyu sudang) under Korean law. You often hear "we're under 5 employees, so labor law doesn't apply to us" — that's only half true. The law specifies exactly what small businesses are exempt from, and weekly holiday pay is not on the exempt list.
Under 5 employees: what's exempt vs what's not
| Item | Businesses with fewer than 5 employees |
|---|---|
| Weekly holiday pay (Korean Labor Standards Act, Art. 55) | Must pay |
| Minimum wage | Must comply (same for all businesses) |
| Severance pay | Must pay (1+ years of service + 15+ hours/week averaged over 4 weeks) |
| Overtime/night/holiday premium pay (Art. 56) | Exempt — base hourly wage only for hours worked |
| Paid annual leave (Art. 60) | Exempt — not mandatory |
The basis is Article 11 of the Korean Labor Standards Act and Annex Table 1 of its Enforcement Decree. With 5 or more regular employees the Act applies in full; with 4 or fewer, only some provisions apply — and the weekly holiday (Art. 55) is one of them.
Note that when counting the 5 employees, the owner is excluded. The count covers "employees," and a business owner is not an employee. If headcount fluctuates, average it: total worker-days over the past month ÷ operating days (regular employee count).
Two basic conditions for weekly holiday pay
- Scheduled to work 15+ hours a week — the employee's contractual weekly hours, averaged over 4 weeks, must be 15 or more (if employed less than 4 weeks, average over that period). A part-timer on 2 days × 5 hours (10 hours/week) doesn't qualify.
- Showed up on every scheduled workday that week — one unexcused absence and no weekly holiday pay that week. However, days of approved leave on some workdays do not count as absences. Applying the legal principle confirmed by the August 2021 administrative interpretation of Korea's Ministry of Employment and Labor — approved leave or suspension periods, during which the duty to work is released, differ from absences — an approved leave day is treated as a day with no duty to attend, so pay is due if the employee attends all remaining workdays. But if the entire week was leave or suspension, weekly holiday pay may not arise (this requires case-by-case judgment).
What about the week an employee quits? Since the 2021 change in administrative interpretation, weekly holiday pay arises if the employment relationship lasted the full week (7 days) and the employee attended all workdays — even with no work scheduled the following week. The interpretation's example (Mon–Fri work, Sunday holiday): perfect attendance through Friday but resignation on Saturday → no pay that week; employed through Sunday, resigning the next Monday → pay due. Very short contracts follow the same rule — the outcome turns on how long the employment relationship lasted that week.
How much do you pay?
The typical calculation (based on a 5-day week):
Weekly holiday pay = regular hourly wage × contractual daily hours
(If under 40 hours/week: hourly wage × weekly contractual hours ÷ 40 × 8)
For employees scheduled over 8 hours a day, practice is to cap it at 8 hours' worth (our app also applies the 8-hour cap). Whether hours beyond 8 must be included can vary by workplace, so it's safest to verify for your case. Calculations also differ for irregular schedules — the examples below cover the most common cases.
Example 1 — 5 days/week, 8 hours/day (40 h/week), hourly wage KRW 10,320
Weekly holiday pay = 10,320 × 8 = KRW 82,560 per week. A month is roughly 4.35 weeks, so about KRW 360,000 on top of base pay.
Example 2 — 5 days/week, 4 hours/day (20 h/week) part-time, hourly wage KRW 10,320
Holiday hours = 20 ÷ 40 × 8 = 4 hours → weekly holiday pay = 10,320 × 4 = KRW 41,280 per week.
Example 3 — part-timer at 14 hours/week
Under 15 hours → no weekly holiday pay.
"Contractual daily hours" here means hours excluding breaks. For a 9-to-6 shift with a 1-hour lunch, contractual hours are 8, not 9.
Three things owners most often get wrong
- "Annual leave is exempt, so weekly holiday pay is too, right?" — No. Annual leave (Art. 60) and the weekly holiday (Art. 55) are separate provisions; the under-5 exemption covers annual leave only.
- "A week with leave taken isn't perfect attendance, so no holiday pay?" — Approved leave is not an absence. If the employee attended all remaining workdays, weekly holiday pay is due.
- "Part-timers don't get weekly holiday pay anyway, right?" — It's not about part-time vs full-time; the threshold is 15 hours a week (averaged over 4 weeks). Part-timers at 15+ hours get it, prorated.
What if you don't pay?
Weekly holiday pay is a statutory allowance — not paying it constitutes wage arrears. If a former employee files a complaint with the labor office, you must pay the missed amounts retroactively. Most cases aren't deliberate — owners simply don't know the calculation — so having it computed automatically every week is the safe setup.
If calculating it by hand every week is a hassle
With nowhereiam, employees clock in and out via QR code and weekly holiday pay is calculated automatically. Rules like the attendance judgment when approved leave falls on some workdays (the interpretation above) are built in. Results are for reference — final payroll confirmation is on you. We struggled plenty turning these rules into code ourselves — we built this so you don't have to.
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