INS Global works as your local partner in foreign markets to provide global Human Resources services. With the help of our experienced PEO/EOR service experts, you can find employees, set up operations, and start working in over 80 countries worldwide, all without the hassle that typically accompanies global expansion.
PEOs (Professional Employer Organization), sometimes referred to as EORs (Employer of Record), are local partners for companies that are expanding into foreign markets. PEOs in South Korea can help these companies to outsource their HR services and enter new countries without having to deal with the complex issues that often arise.
A PEO in South Korea can legally employ your South Korean staff for your company and manage the employee services that affect daily operations. This can include tasks like payroll outsourcing and benefits, saving your company time and money that can be used in more productive ways.
Creating a new company within a foreign country can be a stressful, complex process that requires a legal entity with a physical presence in that target country. The advantages presented by a PEO allows for a company to operate in a foreign market without forcing them to go through the necessary steps of forming and incorporating such a new entity.
A PEO Solution Can:
The expertise provided by a PEO expert in local legal requirements will ensure that your company remains compliant with every aspect of local regulations, even as they change.
Whenever simple mistakes happen within HR, it can cause a disproportionate amount of fees and fines. These mistakes are especially prominent when entering a new market. A PEO can reduce these mistakes, saving your company time and money.
PEOs provide several essential services, like payroll outsourcing, recruitment, headhunting, and contractor management. You and your employees can rest easy while PEO professionals handle these HR processes, leaving you time to focus on what really matters.
Estimated time for Company Incorporation in a new market: 4-12 months
Estimated time to establish a PEO relationship: 5 days
*Global estimate
A PEO in South Korea can handle the intricate details of HR and provide you with a single point of contact to ease the burden of HR problems and simplify the solutions.
INS Global’s PEO in South Korea manages your employee assignment and recruitment needs by following these 4 basic steps:
Manuel Ramos
TERAO ASIA
Managing Director
We think INS Global is a good solution about starting in a market like China. Understanding the market doesn’t mean you need to set up a company immediately.
When entering South Korea with the intention of creating a PEO/EOR agreement, it’s necessary to first fully understand the difference between them to make sure you are making an informed decision.
In South Korea both services are indistinct according to national regulations, but INS Global can offer any elements of both according to your requirements
The main source of employment law in South Korea is derived from the Labor Standards Act (LSA). This act governs the most fundamental and important matters related to employment. These matters include working hours, wages, overtime pay, vacation, etc.
The LSA does not specifically mandate that a written contract be created for most employees. However, it does require however that the following key aspects of the employment relationship be provided in writing by the employer: wage, contractual work hours, holidays, and paid annual leave.
The LSA imposes a maximum of 40-hour work weeks and 8-hour workdays. An employee’s working time may exceed these limits if their recent work time over a longer period not exceeded 40 hours. However, this is subject to restrictions, like obtaining the consent of the employee or their legal representative. The maximum amount of hours an employee is allowed to work weekly in South Korea is 52.
Generally, employees are allowed to agree to an additional 12 hours per week of overtime. For this overtime pay, the employer will be required to pay an additional 50% of their employee’s ordinary wages. Additionally, for night work (work performed between the hours of 10pm and 6am) employers must also pay an additional 50% of wages.
Minimum paid holidays are weekly holidays (usually Sunday) and Labour Day (May 1st). Employees are entitled to an additional 50% pay for 8 hours worked during a holiday, and an additional 100% for any work that surpassed this 8-hour limit.
Employees that work for a full year are entitled to receive 15 days of annual paid leave per year. Employees that haven’t worked a full year, or have an attendance rate of less that 80%, are entitled to receive one annual paid leave day for every month of the year worked.
As of January 1st, 2022, employers with 30 or more employees are required to provide their employees with paid time off on public holidays. Public holidays designated by the government are:
These days may be subject to change on an annual basis.
In accordance with the LSA, the minimum maternity leave that can be provided is 90 days, with a minimum of 45 days taken after the birth of the child. In cases where there are multiple births, the employee is entitled to an extra 30 days. Maternity leave is paid leave and is either paid by the employer or subsidized by the government. Additionally, women are protected from termination during pregnancy and up to 30 days following the birth of their child.
Companies are now also required to provide 10 days of paid paternity leave in South Korea, and are expected to make allowances for unpaid parental leave for both mothers and fathers.
No, it is necessary to use a local entity abroad to comply with each country labor law.
Foreign companies can either set up a local entity in each country or use the services a local PEO (Professional Employment Organization) to hire the staff on-site directly.
The employer of record is the legal entity liable for the staff employed in a specific country. In practice, a foreign company can either open a subsidiary to become the employer of record of its abroad employees or use a PEO to act as the employer of record.
In general, 1-month is necessary to have an employee based out abroad using an existing PEO as the employe of record. When incorporating a new subsidiary to be the employer of record, the delay varies from 4-12 months.
