Employer of Record in South Korea

How hiring through an employer of record works in South Korea

The local employer is the party to the Korean employment contract, enrolls the employee in the four major insurances and runs payroll, and your managers direct the daily work. The Labor Standards Act requires the wage, working hours, holidays and annual leave terms to be stated and given to the employee in writing.

Toku's country data lists regular employees, fixed-term contract workers and freelancers separately, and freelancers are taxed and insured differently from employees, so the classification is part of the first conversation.

Employer costs and contributions in South Korea

The national pension rate for 2026 is 9.5% of pay, shared equally, so the employer pays 4.75%. Health insurance is 7.19% and long-term care is 0.9448% of pay, each shared equally, which comes to 4.0674% for the employer. Employment insurance charges the employer 0.9% for unemployment benefits, matched by the worker, plus an employer-only 0.25% to 0.85% for stabilization and skills development, so the employer total runs from 1.15% to 1.75% by company size.

Industrial accident insurance is paid entirely by the employer. The average rate for 2026 is 1.47%, which already includes a flat 0.06% commuting rate, and industry rates run from 0.5% in finance and insurance to 18.5% in coal mining. Adding the lines above gives roughly 11.4% to 12.0% by company size before severance, which differs from the roughly 10% in Toku's older country data, so confirm the number in your quote.

Severance, leave and working time in South Korea

• Retirement benefit: employers must operate at least one retirement benefit scheme, and the statutory amount is 30 days of average wages per year of service. It does not apply to workers with under a year of service or under 15 hours a week.
• Hours: the limit is 40 hours a week, and overtime can add up to 12 hours a week, which is the 52-hour cap. Extended work is paid at no less than 50% extra.
• Annual leave: 15 days at 80% attendance, with one day per month in the first year, one extra day for every two years beyond the first year from three years of service, with a ceiling of 25 days.
• Minimum wage: 10,320 won an hour in 2026, applying to all workplaces whatever the industry.
• Wages for foreign employees: Korea has a 19% flat income tax option for foreign workers, but its rules and deadlines are changing, so Toku confirms the tax treatment per hire.

Dismissal and notice in South Korea

An employer may not dismiss an employee without justifiable cause. Dismissal needs at least 30 days of advance notice, and where none is given the employer owes 30 days of ordinary wages, with exceptions such as employees with under three months of service.

Because both the cause and the notice are tested, treat any exit as a legal procedure and involve the local employer before telling the employee.

Getting paid in stablecoins, USDC, USDT, tokens and crypto in South Korea

Short answer: No. Article 43 of the Labor Standards Act requires wages in currency, and the labour ministry says assets without legal-tender status, such as crypto assets, cannot replace wages, with penalties of up to three years in prison or a 30 million won fine.

What the law says about the form of pay

Article 43 of the Labor Standards Act requires wages to be paid directly and in full in currency, at least once a month on a fixed day. The Ministry of Employment and Labor states that assets without legal-tender status, such as crypto assets, cannot replace wages unless a law or collective agreement provides otherwise, with violations punishable by up to three years in prison or a fine of 30 million won.

What it means for employee salary

Korean salary, insurance and tax therefore stay in won, and USDC or USDT cannot replace them. What applies to a specific hire is confirmed when Toku checks the arrangement.

Tax on crypto and tokens

Under current law the National Tax Service taxes gains on disposals of crypto assets from January 1, 2027 at 20% above an annual basic deduction of 2.5 million won, and the government proposed a further delay on November 5, 2026.

How Toku handles it

Employee salary in South Korea stays in local currency. Toku’s stablecoin payroll and its USDC or USDT payouts through contractor management are separate arrangements from employee salary, and token grants are administered through token grant administration. What applies to a specific hire in South Korea is confirmed before an offer.

Reviewed November 7, 2026 against the official sources listed below. General information, not legal or tax advice. Tax on crypto or tokens received depends on local rules and where the person is resident, so confirm it with a local adviser.

How hiring through Toku works in South Korea

1. Share the role, location, salary and start date.
2. Toku confirms coverage, the contract type and the right to work.
3. The local employer issues the contract and onboards the person.
4. Payroll, contributions and filings run each cycle.

Toku checks the role, location and contract terms before a start date is agreed. Prepare identification, bank details, the signed contract and the agreed won salary, and expect enrollment in the four major insurances to be handled as part of payroll set-up. Your quote confirms the onboarding timeline for South Korea.

What an employer of record costs in South Korea

Where Toku supports the hire, its employer of record service starts at $599 per employee per month, with salary, employer contributions and benefit premiums itemized in your quote. Coverage in South Korea is confirmed before an offer. See the published pricing.

More on hiring in South Korea

• Payroll and hiring in South Korea
• Employer of record coverage in 100+ countries