I am an employee who is currently on childcare leave. I was going to return to work after my childcare leave but I am considering quitting because of my circumstances. However, what worries me is that I heard, when calculating my severance pay, the last three months’ wages before resignation are important. I have not been paid extra wages in addition to childcare leave benefits from the employment insurance during childcare leave. What do I have to do? Should I work for three months then quit after returning to work to get the right amount of severance pay?

The reason the pay for 3 months before termination of employment is important is because it is the wage paid in those months that is used when calculating average wage for severance pay. “Average wage” is the total amount of wages paid to the worker for the three months prior to the reason for the calculation, divided by the total number of days in the period. Even if workers quit less than 3 months after their reemployment, the same calculation will apply.
Therefore, if you are paid less than usual for any reason for three months before your retirement, your severance pay will be lower. However, maternity leave, childcare leave, and dismissal due to industrial accidents are periods to be exercised by legally guaranteed rights. Workers cannot be disadvantaged because they exercised these legal rights. Therefore, the situations below are excluded from the period from which average wage shall be calculated (Article 2 (1) of the Enforcement Decree of the Labor Standards Act):
1. A period not exceeding three months from the date on which an employee on probation starts working as a probationary employee;
2. A period during which the employer’s business is closed because of a cause attributable to the employer;
3. A maternity leave before and after childbirth, or a miscarriage leave or stillbirth leave;
4. A period of temporary suspension of medical treatment due to occupational injury or disease;
5. A period of childcare leave under the Equal Employment Act;
6. A period of legitimate labor dispute;
7. A period of temporary leave or absence from office in order to perform a duty under the Military Service Act, the Reserve Forces Act, or the Framework Act on Civil Defense: Provided, this shall not apply to a period during which wages have been paid;
8. A period of temporary leave from office due to a non-occupational injury or disease, or any other cause with the employer’s approval.
However, absences for reasons attributable to the worker, a period of closure, a period in which the worker has been arrested for a personal crime and has been terminated, and a period of unlawful dispute are not excluded from calculation of average wage. This can result in a significant reduction in average wage. If the calculated average wage is lower than the ordinary wage of the worker, the ordinary wage will be the average wage.
To answer the above question completely, if the average wage calculation period does not exist because the period of childcare leave exceeds three months, then the calculation of average wage will be based on the three months prior to the first day of leave.