Korean Delayed Wage Interest Calculator
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What is the Korean Unpaid Wage Interest Calculator?
The Korean Unpaid Wage Interest Calculator automatically computes delay interest when an employer fails to pay wages or severance within the legal deadline under Korean labor law. After resignation, 20% annual interest accrues once 14 days have passed (Article 37 of the Labor Standards Act), while unpaid wages during employment carry 5-6% annual interest. The calculator reflects the correct rate and period for each type and shows the total including principal and interest at a glance.
Interest Rate Criteria Under Korean Law
General Case
Legal Interest Rate 6% per year
If there is no separate agreement, the statutory commercial interest rate of 6% per year applies under Korean law (per the Act on Special Cases Concerning Expedition of Litigation).
When Payment Is Delayed
Delay Interest 20% per year
Under Article 37 of Korea's Labor Standards Act, the higher rate of 20% per year applies from the day after 14 days have passed since the payment obligation arose.
Detailed Criteria by Wage Type
1. Monthly Wages During Employment
When regular payday is on or before Oct 22 2025
- Day after regular payday ~ payment date: 6%/yr per Commercial Act Art. 54
- Upon winning a lawsuit, 12%/yr from the day after complaint is served
When regular payday is on or after Oct 23 2025
- Day after regular payday ~ payment date: 20%/yr per Labor Standards Act Art. 37
There is no penalty provision for non-payment of delay interest, so it may not be resolved through a Labor Ministry complaint alone.
2. Severance, DB Pension & Unpaid Wages at Retirement
- From the retirement date to 14 days afterward: 6%/yr per Commercial Act Art. 54
- From the 15th day after retirement ~ payment date: 20%/yr per Labor Standards Act Art. 37
There is no penalty provision for non-payment of delay interest, so it may not be resolved through a Labor Ministry complaint alone.
3. DC-type Retirement Pension
- Regular contribution due date ~ 14 days after retirement: 10%/yr per Retirement Benefits Act Art. 20
- From the 15th day after retirement ~ final payment date: 20%/yr per Retirement Benefits Act Art. 20
Non-payment of delay interest is subject to criminal penalties of up to 3 years imprisonment or 30M KRW fine, and can be resolved through a Labor Ministry complaint.
Exceptions to Delay Interest Under Korean Law
The 20% annual delay interest may be waived (reduced to 6%) in the following cases under Korean law: unavoidable circumstances such as natural disasters or legislative changes; employer insolvency or rehabilitation; legal disputes over the existence or scope of the wage claim. Even when exceptions apply, non-payment of the principal remains unlawful and workers can exercise their rights through a Labor Office complaint or civil lawsuit.
Recommended For
- Unpaid wages after resignation: when 14+ days have passed since leaving and wages remain unpaid
- Unpaid severance: when severance pay was not received on time and you want to claim delay interest
- Delayed salary during employment: when payday was missed and wages were paid late
- Lawsuit preparation: when you need to estimate claimable amounts before filing a wage claim under Korean law
- Pre-consultation check: when you want to estimate interest amounts before consulting a Korean labor attorney