Uni HR says foreign instructors on annual contracts don't get severance. Is that real?

Year 3 at my uni, contract ends in February. The HR person mentioned offhand that "severance doesn't apply for foreign instructors on annual contracts" and I was too caught off guard to push back.

Is this actually true? I've been here three full years on rolling 1-year contracts. Korean law as I understand it: 1+ year of continuous employment = severance equal to ~1 month per year. Three years should mean roughly 3 months of pay.

Is the "annual contract" framing a real loophole, or is HR just hoping I won't push?

Adding context: I left a hagwon for this uni, so the 3 years are at the uni only. No break between contracts.

2 replies

u/MarieUni10yr

Verified · 10-year resident · Uni teacher·1d ago

HR is hoping you won't push. This is a classic dodge and it doesn't hold up.

The Korean Labor Standards Act applies to foreign workers the same as Korean workers. Severance (퇴직금) is owed for 1+ year of continuous employment. "Annual contracts" with no break in between are treated as continuous employment under court rulings — the renewal counts as continuation, not a fresh start. Three years of continuous teaching at the same uni = ~3 months severance.

The wording your HR used is a known evasion. I've seen at least 5 foreign teachers at unis get this exact line, and all 5 recovered their severance through the Labor Office.

What to do:
1. Don't sign anything that says "I waive severance" or "this is final settlement" without consulting first.
2. Calculate what you're owed: roughly your average monthly salary over the last 3 months × number of years worked. (Exact formula: 30 days × average daily wage × continuous service years.)
3. After contract end, give the uni 14 days to pay. If they don't, file at the Labor Office (고용노동부) within 3 years.
4. Labor Office process is free, takes 2-3 months, foreign-friendly. They usually recover full amount.

Don't be intimidated by "but you're on a 1-year contract" — that's exactly the situation the law was written to protect.

u/SeojinVisaHelp

Verified expert · Immigration paralegal·1d ago

Marie's right on the practical outcome. Two technical clarifications that have come up in actual cases:

"Continuous" employment can be challenged if there were gaps. If your annual contracts had a 1-2 week break in between (common for hagwons, less so for unis), the uni might argue the service wasn't continuous. Korean courts have ruled both ways, but typically a gap of less than 1 month is still considered continuous. If you had ANY break, gather documentation (school schedule, payment records) showing the resumption was treated as a continuation.

The severance amount calculation: it's not exactly "1 month per year." Specifically, it's (average daily wage of the last 3 months) × 30 days × (years of continuous service + months/12). So 3 years 0 months = ~3 months. 3 years 6 months = ~3.5 months.

For your case (3 years continuous at one uni), you're owed real money — likely 8-12M KRW depending on your salary. Worth not signing it away.

If the uni provides a "severance was already included in your monthly salary" defense (some try this), it has to be clearly itemized in writing on each pay slip. If your pay slips don't show a separate "severance accrual" line, that defense fails.