\n| Congratulatory and condolence expenses, meal expenses, and transportation expenses<\/td>\n | exception<\/td>\n | Nature of employee benefits<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Average wage is not calculated by dividing the monthly salary by 3.<\/strong> It involves a complex process of adding up all wages for the three months prior to retirement and dividing by the number of days.<\/p>\nThe basic formula is as follows: (Total wages for the 3 months prior to retirement + Annual bonus \u00d7 3\/12 + Unused annual leave allowance \u00d7 3\/12) \u00f7 Total number of days in the 3 months prior to retirement = Average daily wage. Then, after multiplying the average daily wage by 30 days... The final severance pay is the value obtained by dividing the number of days of employment by 365 days.<\/strong><\/p>\nFor example, if your 3-month salary is 9 million won, there are no bonuses or annual leave allowances, and the 3 months consist of 90 days, your average daily wage is 100,000 won. Please note that if the average wage is lower than the ordinary wage, the ordinary wage will be automatically applied.<\/p>\n <\/span>Items included in and excluded from wages<\/span><\/h2>\nWhen calculating average wages, what is added or subtracted significantly influences the result. Basic salary, overtime, night, and holiday work allowances, and fixed allowances (position allowance and job allowance) must be included.<\/strong><\/p>\nBonuses are included as well, Only 3 months' worth (3\/12) of the total bonuses received during the year prior to retirement is calculated.<\/strong> If it is a holiday bonus or a regular bonus, it is usually included because it satisfies the requirements of regularity and uniformity.<\/p>\nOn the other hand, allowances of a welfare nature, such as congratulatory and condolence expenses, meal allowances, and transportation expenses, are not included. Performance-based bonuses or merit-based pay are also not included as they vary by individual.<\/p>\n <\/span>Annual Leave Allowance and Bonuses: Easily Confusing Calculation Methods<\/span><\/h2>\nAnnual leave allowance is divided into two types.<\/strong> Annual leave that has already accrued but has not been used is reflected in the average wage at 3\/12. On the other hand, annual leave that accrues only upon retirement (e.g., annual leave newly generated upon completing 3 years of service) is settled separately from severance pay.<\/p>\nThe criteria for determining whether bonuses are included in ordinary wages have changed starting in 2025. Previously, they were included only if all three conditions\u2014regularity, uniformity, and fixedness\u2014were met, The fixed requirement has now been removed, and payments made regularly and uniformly are eligible for inclusion.<\/strong> It means that even with employment conditions, you can be eligible as long as it is regular.<\/p>\nIf your company does not have a bonus system, you should naturally exclude that item from the calculation. However, you must be careful, as failing to enter a bonus into the calculator will significantly lower the result.<\/p>\n |