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  • BearNana
  • Veteran

    • 107

    • February 27, 2013, 10:33:57 am
    • Incheon
Severance pay + Renewal bonus = related?
« on: December 27, 2016, 01:03:42 pm »
Ok so I am coming to the end of my 4th year at my public school, not sure if I am going to renew or not. I was talking to some friends about how I'll be getting a sweet severance package (last month's pay X 4), and then they informed me that actually I won't be getting that at all. They seem to think that since I have been getting a renewal bonus every year, that I won't get severance.

I thought the renewal bonus and the severance pay were completely unrelated.

Who is right?


  • The Arm
  • Expert Waygook

    • 682

    • March 09, 2015, 09:15:02 am
Re: Severance pay + Renewal bonus = related?
« Reply #1 on: December 27, 2016, 01:16:57 pm »
You're right, your friends are wrong.

Renewal bonus and severance are unrelated.

Enjoy that sweet windfall if you decide to leave  8)


  • Grimne_Lothos
  • Expert Waygook

    • 846

    • December 28, 2011, 12:56:27 pm
    • Buyeo, south korea
Re: Severance pay + Renewal bonus = related?
« Reply #2 on: December 27, 2016, 01:17:28 pm »
if they have been paying your severance every year then you do not get 4 years severance.   Was there a separate renewal bonus in your contract that you are referring to or have you just been mislabeling the severance they have been paying you at the end of each year as a renewal bonus?


  • Pecan
  • The Legend

    • 3769

    • December 27, 2010, 09:14:44 am
    • Seoul
Re: Severance pay + Renewal bonus = related?
« Reply #3 on: December 27, 2016, 01:18:09 pm »
You should be entitled to severance and pension.

Obviously, if they have been paying you your severance at the completion of each contract, you won't be receiving it twice.

However, you are still entitled to receive your pension, which amounts to about the same amount you were hoping to receive.


  • BearNana
  • Veteran

    • 107

    • February 27, 2013, 10:33:57 am
    • Incheon
Re: Severance pay + Renewal bonus = related?
« Reply #4 on: December 27, 2016, 01:20:48 pm »
if they have been paying your severance every year then you do not get 4 years severance.   Was there a separate renewal bonus in your contract that you are referring to or have you just been mislabeling the severance they have been paying you at the end of each year as a renewal bonus?

All EPIK contracts refer to a renewal bonus. I think...?!

"The employer shall prove the Employee with a Contract Renewal Allowance of 2,000,000 Korean Won within one month of the beginning of the new Term of Employment. In the case of Contract renewal, the employee shall not receive an Exit Allowance for the renewal Term of Employment."

If renewal bonus and severance where the same, then it wouldn't be "2,000,000 won". It would be the value of your last month's pay check. Every year the bonus is the same.
« Last Edit: December 27, 2016, 01:35:33 pm by BearNana »


Re: Severance pay + Renewal bonus = related?
« Reply #5 on: December 27, 2016, 01:24:56 pm »
Yeah, severance and renewal are completely separate, at least for EPIK contracts.

The renewal bonus is something you should be getting every year one month after the start of your new contract, and it should be 2.1 mil. Some schools will pay this amount in full, but the EPIK contract stipulates that schools can hold out paying 800K won of the bonus for up to 6 months. If you're moving schools, then the old school would be responsible for paying 1.3 mil and the new school would be responsible for 800K, but, again, the new school can hold off on that for 6 months.

Severance should be equal to one month's paycheck (whatever you're currently being paid) and should be getting deposited into an account that gets released upon termination and non-renewal of your contract. Some schools pay this at the beginning of the year along with the renewal bonus, though... they're not supposed to, but it happens.

So, for example, if your paycheck is 2.1 mil, you should have received approximately 4.2 mil a month after the start of your new contract (minus 800K for those schools that don't pay in full at once)... but if you received something like 6.3 mil instead, you should know that the school probably went ahead and paid you that year's severance amount instead of depositing it into your severance account like it should have, in which case you will not receive that amount at the end of your contract because it's already been paid.

If you're not renewing and you're leaving the country, you should also be receiving an exit allowance (which, I think, is 1.3 mil).

And if you're from Australia, Canada or the U.S., and are leaving Korea, you're also entitled to receive a 100% refund on whatever was paid into pension for you.
« Last Edit: December 27, 2016, 01:38:13 pm by Chinguetti »


  • Pecan
  • The Legend

    • 3769

    • December 27, 2010, 09:14:44 am
    • Seoul
Re: Severance pay + Renewal bonus = related?
« Reply #6 on: December 27, 2016, 01:36:33 pm »
Renewal bonus?

That is what replaced paying for our airplane tickets, and as others have stated, it isn't related to your severance.


  • BearNana
  • Veteran

    • 107

    • February 27, 2013, 10:33:57 am
    • Incheon
Re: Severance pay + Renewal bonus = related?
« Reply #7 on: December 27, 2016, 01:39:06 pm »
Thanks for the replies. Seems like I was right? I'm not sure why my friend is convinced they are related.



Re: Severance pay + Renewal bonus = related?
« Reply #8 on: December 27, 2016, 02:29:57 pm »
It seems like they have changed the wording in my new contract compared to previous ones.

Previous: Article 13-7
"The employee shall be entitled to severance pay according to the standard formula set out by the Ministry of Labor (equivalent to approximately one month's salary), upon successful completion of the duties set out herein for the entire Term of Employment."

2017: Article 13-7
"The Employee shall be entitled to severance pay according to the Employee Retirement Benefit Security Act set out by the Ministry of Labor, upon successful completion of the final contract with the concerned Employer."

Questions:
Is 'the entire Term of Employment' and "final contract with the concerned Employer" the same thing or is entire term mean 1 full year?
If they are the same we only get one severance payment when we leave the country. Also, the new contract doesn't give an amount.

As for my pension, i get a statement about every 6 months, but where do we go to find out if our severance is accumulating year by year or if we just get a single severance payment on the way out?



Re: Severance pay + Renewal bonus = related?
« Reply #9 on: December 27, 2016, 03:07:34 pm »
It seems like they have changed the wording in my new contract compared to previous ones.

Previous: Article 13-7
"The employee shall be entitled to severance pay according to the standard formula set out by the Ministry of Labor (equivalent to approximately one month's salary), upon successful completion of the duties set out herein for the entire Term of Employment."

2017: Article 13-7
"The Employee shall be entitled to severance pay according to the Employee Retirement Benefit Security Act set out by the Ministry of Labor, upon successful completion of the final contract with the concerned Employer."

Questions:
Is 'the entire Term of Employment' and "final contract with the concerned Employer" the same thing or is entire term mean 1 full year?
If they are the same we only get one severance payment when we leave the country. Also, the new contract doesn't give an amount.

As for my pension, i get a statement about every 6 months, but where do we go to find out if our severance is accumulating year by year or if we just get a single severance payment on the way out?

As far as I know and understand, they're the same thing, just worded differently so that there will be less confusion about when a person can expect his/her severance payment.

And yes, in theory, you're supposed to receive a single severance payment at the completion of your final contract with your current employer (the POE/MOE for EPIK teachers), which is supposed to be an accrued amount of an annual deposit made for every year you renew with your current employer (aka POE/MOE) and placed into an account opened for you for that purpose. The schools are responsible for this annual deposit, while *I think* the POE/MOE is in charge of the account itself; however, the schools seem to have almost unlimited access to it and may be the ones to close the account so that you'll be issued your payment, but, again, I'm not really sure about that much.

In practice, though, some schools are paying out whatever it owes for severance along with your renewal bonus at the time that the bonuses are issued. They aren't supposed to, but some schools are doing it.

I don't think the new contract states the specific amount that should be paid because it refers to the Employee Retirement Benefit Security Act, which probably details that for interested parties. They more than likely left that much out because they were told it was redundant.

As for finding out how much severance you may have already accumulated... I have no idea. Since schools have access to the account to at least make the deposits, it's possible they might be able to check, but I couldn't say if they are actually able to and, if they are, if they'd be willing to.
« Last Edit: December 27, 2016, 03:11:09 pm by Chinguetti »


Re: Severance pay + Renewal bonus = related?
« Reply #10 on: December 27, 2016, 03:15:43 pm »
It seems like they have changed the wording in my new contract compared to previous ones.

Previous: Article 13-7
"The employee shall be entitled to severance pay according to the standard formula set out by the Ministry of Labor (equivalent to approximately one month's salary), upon successful completion of the duties set out herein for the entire Term of Employment."

2017: Article 13-7
"The Employee shall be entitled to severance pay according to the Employee Retirement Benefit Security Act set out by the Ministry of Labor, upon successful completion of the final contract with the concerned Employer."

Questions:
Is 'the entire Term of Employment' and "final contract with the concerned Employer" the same thing or is entire term mean 1 full year?
If they are the same we only get one severance payment when we leave the country. Also, the new contract doesn't give an amount.

As for my pension, i get a statement about every 6 months, but where do we go to find out if our severance is accumulating year by year or if we just get a single severance payment on the way out?

I don't think you need to worry about the wording of your contract in regards to severance because it's superseded by Korean labor laws regardless. The translation is confused by the fact that they use the term "retirement benefits" to refer to what we call severance pay.

I've read on here it was different in the past but nowadays you get a single severance payment on the way out based on your average salary over the last 3 months, multiplied by how many years you've worked for the employer.

This was updated this year: http://www.korea4expats.com/article-severance-pay-korea.html


Re: Severance pay + Renewal bonus = related?
« Reply #11 on: December 27, 2016, 03:18:21 pm »
I don't think you need to worry about the wording of your contract in regards to severance because it's superseded by Korean labor laws regardless. The translation is confused by the fact that they use the term "retirement benefits" to refer to what we call severance pay.

I've read on here it was different in the past but nowadays you get a single severance payment on the way out based on your average salary over the last 3 months, multiplied by how many years you've worked for the employer.

This was updated this year: http://www.korea4expats.com/article-severance-pay-korea.html

Would you happen to know who's in charge of the account itself? I've been told that the schools are the ones that handle the account, but that the POE regulates it, and this has confused me.

I'm guessing this is a unique EPIK situation.
« Last Edit: December 27, 2016, 04:54:44 pm by Chinguetti »


Re: Severance pay + Renewal bonus = related?
« Reply #12 on: December 27, 2016, 03:35:42 pm »
Thanks for helping me understand the clusterf*&ck. I just wonder how many many NETs left here without getting the proper amount they were entitled to. Pension+Severance. I personally would never have known, and my ct has no experience being a handler.


  • oglop
  • The Legend

    • 3013

    • August 25, 2011, 07:24:54 pm
    • Seoul
Re: Severance pay + Renewal bonus = related?
« Reply #13 on: December 27, 2016, 05:29:59 pm »
not everyone is entitled to receive their pension back. for example, british citizens can't claim theirs back