Korea's minimum wage — which parts of your pay actually count towards it

Checking whether you are paid the minimum wage is not "divide monthly pay by hours". The Act is specific about which parts of your pay may be counted, and the parts it excludes are exactly the ones employers use to make the total look bigger.

Short answer

2026 hourly minimum        10,320 won
Below it in the contract   THAT PART IS VOID and the legal minimum applies instead
Probation                  may be reduced — only on a contract of 1 year or more,
                           only in the first 3 months, and NOT for simple-labour jobs
Not counted                overtime, night and holiday premiums
Counted only in part       bonuses above 25% of the monthly minimum-wage equivalent
                           meal / transport / accommodation paid in cash,
                           above 7% of that monthly equivalent
Never counted              anything paid in kind rather than currency
Penalty                    up to 3 years in prison or a 20 million won fine

A contract below the minimum rewrites itself

Article 6:

① An employer shall pay wages at or above the minimum wage to a worker to whom the minimum wage applies. ② An employer shall not reduce the previous wage level on the ground of the minimum wage under this Act. ③ Any part of a labour contract that sets wages below the minimum wage is void, and the void part is deemed to have agreed on the same wage as the minimum wage under this Act.

Paragraph 3 is the one worth knowing. You do not have to renegotiate anything. The clause is void and the legal minimum takes its place automatically — what remains is the arithmetic of what you are owed.

Paragraph 2 blocks the obvious workaround: an employer cannot cut some other component to fund the increase.

What counts, and what does not

Article 6(4) — wages paid regularly, at least once a month, are counted. Then it excludes:

1  wages other than those for contractual working hours or contractual working days,
   as prescribed by Ministry ordinance
   → this is where OVERTIME, NIGHT and HOLIDAY premiums sit. They do not count.

2  bonuses and similar payments — only the portion ABOVE 25% of the monthly amount
   converted from that year's hourly minimum wage is counted

3  meal, accommodation and transport allowances and similar welfare payments:
   (a) anything paid IN KIND rather than in currency — never counted
   (b) paid in cash — only the portion ABOVE 7% of that monthly converted amount

So the common employer argument — "your pay includes 300,000 won of meal and transport allowance, so you are over the minimum" — is only partly true. Most of that allowance is excluded, and the dormitory room you are given instead of cash is excluded entirely.

Overtime is the bigger one. If your total only reaches the minimum because you worked extra hours, the base pay is still below it. Take the premiums out before you compare.

Article 6(6) clarifies the other direction: paragraphs 1 and 3 do not force the employer to pay for hours or days you did not work because of your own circumstances, or where the employer had a justified reason not to have you work.

Probation is not an automatic discount

Article 5(2):

For a worker who has concluded a labour contract for a period of one year or more and is in probation, within three months from the day probation began, a minimum wage different from that under paragraph 1 may be set, as prescribed by Presidential Decree. Provided, that this shall not apply to workers engaged in occupations of simple labour published by the Minister of Employment and Labour.

Three conditions, all required: a contract of one year or more, within the first three months, and not a simple-labour occupation on the published list.

That last exclusion is what most often makes a probation deduction unlawful in practice, because much of the work foreign workers do falls inside it. If someone reduces your wage "because you are new", ask which of the three conditions they say is satisfied.

When contractors are involved

Article 6(7) — where a subcontractor pays below the minimum wage for a reason the principal contractor is responsible for, the principal is jointly liable.

Article 6(8) defines those reasons:

1  the principal set the labour-cost unit price below the minimum wage
   when concluding the contract
2  the principal lowered the unit price below the minimum wage during the contract

Paragraph 9 pushes the same rule up the chain where there are multiple layers of subcontracting. On construction sites and in manufacturing subcontracting — where a lot of E-9 and H-2 work sits — this means the company whose site you are on may be liable alongside the one that pays you.

The penalties

Article 28(1):

A person who pays less than the minimum wage in violation of Article 6(1) or (2), or who reduces the previous wage on the ground of the minimum wage, shall be punished by imprisonment for up to 3 years or a fine of up to 20 million won. The imprisonment and the fine may be imposed concurrently.

That last sentence is unusual and deliberate — both penalties can be applied together.

Paragraph 2 — where a principal contractor is jointly liable under Article 6(7) and fails to comply with a labour inspector's corrective order within the deadline: up to 2 years' imprisonment or a 10 million won fine.

How to check your own pay

1  Take the gross monthly figure.
2  Subtract overtime, night and holiday premiums entirely.
3  Subtract meal / transport / accommodation allowances up to 7% of the monthly
   minimum-wage equivalent, and all of anything given in kind.
4  Subtract the part of any bonus up to 25% of that monthly equivalent.
5  Divide what is left by your contractual hours — including the weekly paid
   holiday hours under Labor Standards Act Article 55.
6  Compare with 10,320 won.

Step 5 is where people go wrong on their own. Weekly paid holiday hours belong in the denominator — see annual leave and weekly holidays.

If the result is below the minimum, that is also a listed ground for E-9 workers to change workplace without using up a count — see changing workplace on an E-9.

Frequently asked questions

I signed a contract at less than the minimum. Article 6(3) makes that part void and substitutes the legal minimum. Your signature does not validate it.

My employer counts the dormitory as part of my wage. Article 6(4)3(a) excludes anything paid in kind from the minimum wage calculation entirely.

I am on probation, so I get 90%. Only if the contract runs a year or more, you are inside the first three months, and your occupation is not on the simple-labour list. Ask which condition they rely on.

Who do I contact? The Ministry of Employment and Labour on 1350, which offers foreign-language counselling. Bring payslips — see your payslip.

Sources

Minimum Wage Act (최저임금법)
   Art. 5 (minimum wage amount; probation exception and its simple-labour proviso)
   Art. 5-2 (conversion of wages) · Art. 6 (effect of the minimum wage), paras 1–9
   Art. 6-2 (special procedure for amending work rules) · Art. 28 (penalties)
   https://www.law.go.kr/법령/최저임금법

2026 hourly minimum wage: 10,320 won — Minimum Wage Commission announcement

Ministry of Employment and Labour: 1350