Employers are obliged to liquidate wages and compensation in the event of death or retirement of a worker.
Obligation to liquidate money and valuables for deceased and retired workers- When an employee dies or retires, the employer shall pay the wages, compensations, and other money or valuables within 14 days after the cause for such payment occurred. (Main text of Article 36, 「Labor Standards Act」)
Liquidation subject- The objects to be liquidated are wages, compensation, and all other money and valuables (Refer to the main text of Article 36,「Labor Standards Act」).
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Division |
Description |
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Wage |
• The term wages means wages, salary and any other kinds of money or valuables, regardless of their titles, which the employer pays to an employee as remuneration for work. (Subparagraph 5, Article 2(1),「Labor Standards Act」) |
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Compensation |
• Accident compensation for medical treatment, suspension of work, disability, survivors, funeral expenses, installment compensation, and lump sum. (Article 78 to 85, 「Labor Standards Act」) |
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All other money and valuables |
• Incentives for achievement of goals (Refer to Ministry of Employment and Labor, 『Labor Standards Act inquiry & replies』 Labor Standards Policy Division - 2195, 2009.6.29.)
• Year-end settlement refund of earned income (Supreme Court Decision 2009Do2357 on 2011.5.26.) |
Penalty for violation (no punishment against will)- A person who violates the obligation of liquidation of money and valuables shall be punished by imprisonment with labor for not more than 3 years or by a fine not exceeding 30 million won. (Article 109(1), 「Labor Standards Act」)
- Provided, a public prosecution against a person may not be raised against the clearly expressed will of the person in this case. (Article 109(2), 「Labor Standards Act」)