In Korea, a pay change needs new written terms, not a new contract

This guide is for employers and HR staff in Korea, and for employees whose pay changes. The rule: you do not have to sign a new employment contract every year, but when pay or another core condition changes, the new terms must be stated, and the core items must be handed to the worker in writing (Labor Standards Act (근로기준법), Article 17). This applies to every employer, including those with 4 or fewer employees.

What Article 17 requires

When hiring, the employer must state these working conditions, and must state them again whenever they change:

1. wages;
2. contractual working hours (소정근로시간);
3. paid holidays under Article 55, such as the weekly paid holiday;
4. annual paid leave under Article 60;
5. other conditions set by Article 8 of the Enforcement Decree: the place of work and duties, the matters in items 1~12 of Article 93 (such as start and end times, breaks and how wages are calculated), and dormitory rules if the worker lives in a company dormitory.

For wages, the employer must hand over a document that states the pay components, the calculation method and the payment method. The same document must state the contractual working hours, holidays and annual leave (Article 17(2)). Since January 5, 2021, the law says this can be an electronic document.

So if nothing changes, the existing contract stays in force and no yearly re-signing is needed. If the salary changes by individual agreement, the new wage terms must be written down and given to the worker.

Two ways to record a pay change

• Separate salary agreement (연봉계약서). State the new annual or monthly pay, the period it covers, the pay components and the payment method. Add that all other terms follow the existing employment contract and company rules.
• Amendment of the wage clause. Change only the wage clause of the existing contract. State the new amount and the date it applies from, and say that the other terms stay the same. Date the document on the day the change was agreed.

Both parties sign, and the worker keeps a copy.

Changes that need new written terms

Overtime, night and holiday premiums are calculated on ordinary wages (통상임금), not simply on base pay (Article 56). Ordinary wages mean pay set to be given regularly and uniformly for agreed or total work (Enforcement Decree, Article 6). Check how a new pay structure changes the premium calculation before you adopt it.

A change that makes conditions worse needs the worker's agreement. If the change is made through the work rules (취업규칙), the employer needs the consent of the union that represents a majority of the workers or, if there is none, of a majority of the workers (Article 94).

When a copy is needed only on request

Under Article 17(2) and Article 8-2 of the Enforcement Decree, the employer must hand over a new written copy only when the worker asks, if the change comes from:

• a written agreement with the workers' representative under the listed working-time provisions, such as flexible or selective working hours;
• the work rules (Article 93);
• a collective agreement (Trade Union and Labor Relations Adjustment Act, Article 31);
• a law, such as a minimum wage increase.

For example, the minimum wage is ₩10,320 per hour in 2026 and ₩10,700 per hour from January 1, 2027. Pay must rise to that level, but a new document is required only if the worker asks. See 2027 minimum wage ₩10,700: notify workers by December 31, 2026.

Work rules set a floor. Any contract term below the work rules is void for that part and is replaced by the work rules standard (Article 97). Tell staff about rule changes even when no new copy is required.

Electronic contracts

A document is not denied legal effect only because it is electronic (Framework Act on Electronic Documents and Transactions, Article 4). It counts as a written document if its content can be viewed and it is kept in the form in which it was created, sent, received or stored, or in a form that reproduces it (Article 4-2). An electronic signature is not denied effect as a signature or seal only because it is electronic, and it has that effect where the parties chose it (Digital Signature Act, Article 3). A Ministry of Employment and Labor (고용노동부) guideline from 2016 recommended saving signed electronic contracts as read-only files. Make sure the worker can open and keep a copy.

Penalties

• Breaking Article 17 is punishable by a fine of up to ₩5,000,000 (Article 114). This covers fixed-term and part-time workers too.
• For fixed-term and part-time workers, the Fixed-term and Part-time Workers Act (기간제법) also requires a written statement of six items: the contract period, working hours and breaks, pay components with the calculation and payment method, holidays and leave, the place of work and duties, and, for part-time workers, the working days and hours per day (Article 17). A breach brings an administrative fine of up to ₩5,000,000 (Article 24).
• If an agent, manager or other employee of the business owner commits the violation, the owner is fined as well, unless it took due care and supervision to prevent it (Labor Standards Act, Article 115).

Checklist

• Check whether the change touches pay, pay components, contractual hours, holidays or annual leave.
• If it does, write down the new terms and give the worker a copy.
• Use a salary agreement or a partial amendment, and keep the original contract.
• Get the worker's agreement for any change that makes conditions worse.
• For changes through work rules, collective agreements or law, give a copy when asked.
• Store signed electronic files so both sides can open them and nobody can alter them.