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Wage/Severance
What is Average Wage?
10/1/2025
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Author:system
Average wage refers to the amount obtained by dividing the total amount of wages paid to that worker during the 3 months prior to the day on which the reason for its calculation arises by the total number of days in that period. Here, the total wage amount that serves as the basis for calculating the average wage includes all monetary payments that the employer pays to the worker as the object of labor, including not only the basic salary or base pay and regularly paid ordinary wages, but also allowances that are variably paid each time a payment reason occurs, such as holiday pay, overtime pay, night work pay, annual and monthly leave pay, daily and on-duty pay, etc. Furthermore, if they are continuously and regularly paid to the worker and the employer is obligated to pay them under collective agreements, employment rules, etc., bonuses, family allowances, physical training expenses, meal allowances, transportation expenses, etc., are all included regardless of their name. For bonuses or annual leave allowances, the total amount received in the 1 year prior to the date the reason arises is divided by 12 to get the monthly average amount, which is then added to the 3-month wages for calculation. The total number of days in 3 months is not the actual working days but the calendar days, which is 89 to 92 days. However, in cases of ① probationary period, ② period of suspension due to employer's fault, ③ maternity leave period before and after childbirth, ④ period of suspension due to work-related accident, those days and the wages paid during that period are deducted from the relevant period and total amount. However, in cases such as absenteeism or leave due to the individual's fault, they are not deducted, and if the average wage is lower than the ordinary wage in such cases, the ordinary wage is considered the average wage. The average wage serves as the basis for calculating severance pay, suspension allowances, and workers' compensation.
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