All About Twejikum (퇴직금) (Computation, Claiming, Etc.)

The Twejikum (퇴직금) is one of the benefits that a migrant worker in Korea can avail after the sojourn in South Korea. It is also called “severance pay”, a lump sum of money paid by the employer for the number of years that a particular worker has served the company. Those who were able to work in one company for a minimum of one year or more are qualified to receive the severance pay.

COMPUTATION

About one month before your departure, your company(or you) will contact the insurance company for the computation of your Departure Guarantee Insurance. The insurance company will then provide the receipt where it shows the computation of your Twejikum. This is how it is being computed:

1. 1. Add your last 3 months salary

Example:

 January : 1,800, 000 Won

 February: 1,900,000 Won

 March: 2,000,000 Won

Last 3 months salary = 1.8M won + 1.9M won + 2M won = 5.7M won

2. 2. Get the average pay per day by dividing the sum of your Last 3 months salary by the total number of days of last 3 months.

Example:

January : 31 days

February: 28 days

March: 31 days

Total Number of Days of Last 3 Months= 31+28+31 = 90 days

Average Pay Per Day = 5.7M won ÷ 90 days = 63,333.33 Won/Day

3. 3. Compute the Average salary in one month by multiplying the result of number 2 to 30 days.

Average Pay Per Month = 63,333.33 x 30 = 1,900,000 Won

4. 4. Compute your Twejikum by Multiplying the result to the number of years of service.

To compute the exact number of years, this is the formula:

Number of years = Total Number of years + [Total Number of Months x (1 year/12 months)]

(For example, worker has finished 4 years and 10 months of work):

                Number of years = 4 years + [10 months x (1 year/12 months)]

                Number of years = 4 years + 0.83

                Number of years = 4.83

Twejikum = 1,900,000 Won x 4.83

Twejikum = 9,177,000 KRW

CLAIMING

Now that you know how much your twejikum is, the big question now is how to claim it!

Your boss should pay you that amount the moment you leave the company. Basically, they have been paying for your severance pay already via the Departure Guarantee Insurance. However, as they are only paying 8.3 percent of your monthly salary, your boss should pay you upfront for the remaining amount.

Say for example, your boss was able to deposit a total of 6,000,000 won in your departure guarantee insurance, he should pay you a total of  9,177,000 KRW- 6,000,000 KRW which is 3,177,000. This amount should be deposited in your payroll account along with your last salary or whatever account you want to nominate.

How about the 6,000,000 won? Where should you claim it?

You should claim it at the airport. Your boss will let you sign up a form where you can nominate a bank to which you want to claim the remaining amount of your departure guarantee insurance. Once you signed up the form, all you need to do is wait for your date of departure and claim it in the airport.

CLAIMING TWEJIKUM AT THE AIRPORT

When claiming Twejikum at the airport, you must go to the bank you nominated at the third floor of Incheon Airport. Usually, they are located near the boarding gates of the airport. You can ask around or look it up yourself, they are not difficult to find.

Once you’re at the currency exchange center of the bank of your choice, they will simply ask you for passport and Alien Card. They already know you are coming, there’s no more fuss or asking for extra document when you approach them.

They will convert your money into dollar denomination, and after verification, they will give you a receipt of the conversion of your money. You must present this receipt at the bank after passing through the immigration so they will give you your cash. Don’t worry, they will provide instruction as to which gate the bank is located, all you need to do is enter the immigration and proceed to the gate they suggested to find the bank and get your cold cash!

That’s it! It’s not really that complicated. If you know how to follow instruction, you can get your twejikum without a fuss. For better flow of transaction, it would be better if you book a flight at night time and during weekdays.