---
title: "What Accommodation Owners Need to Know About Employee Termination"
description: "Types of separation and proper termination procedures"
published: 2023-09-05T00:00:00+00:00
author: "ONDA 편집팀"
category: "Insights"
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canonical: https://global.onda.me/en/blog?slug=sugbageob-sajangnimi-alaya-hal-jigweon-toejig-si-juyi-sahang
locale: en
---
# What Accommodation Owners Need to Know About Employee Termination

### **Labor Consultant Choi Chang-gyun's Hospitality HR Q&A**

#### **10. What Accommodation Owners Need to Know About Employee Termination**

#### **Hospitality HR Q&A – Part 10**

##### Writer: Choi Chang-gyun, Labor Consultant

##### Editor: ONDA Manager Lee Chae-eun

Seocho Labor Law Firm specializes in hospitality HR management.
We currently manage HR for numerous accommodation businesses, conduct training for hospitality franchise headquarters (Yanolja, Yeogi Eottae, and others), and contribute to creating happier workplaces for everyone in the industry.

We believe that happy workplaces make happy lives.
This series aims to provide essential HR management information to those building their workplaces together.

## 1. Wait — there are different *types* of employee separation?

In everyday language, "termination" just means an employee leaving the company. But from an HR management perspective, separations fall into distinct categories. Why? Because different types of separation trigger different legal requirements. Labor law protects certain kinds of termination while leaving others to mutual agreement between parties.

So the most critical question in separation management is: **"What type of separation is this from an HR legal standpoint?"** If you process a termination without making this determination, you risk violating labor law — which can lead to situations like this:

Employee A works the front desk at OO Hotel. He's been reprimanded repeatedly by Manager B for excessive phone use during shifts and leaving without notice. Eventually, tensions boil over. Manager B tells Employee A: "Finish out the month, then don't come back." Employee A apologizes and works through the end of the month, then leaves.

Manager B hears nothing from Employee A after his departure and assumes everything's fine. Two months later, a document titled **"Request for Written Response"** arrives from the Labor Relations Commission.

Manager B calls the commission, confused. Employee A has filed an unfair dismissal claim. A written response is mandatory. Manager B submits a detailed account of Employee A's misconduct.

A month later: notice of an **"inquiry hearing"**. Manager B attends. That evening, the Labor Relations Commission notifies him: **"Unfair dismissal confirmed."**

Manager B must pay Employee A roughly four months of back wages (from dismissal date to ruling date). Employee A **returns to the hotel** — reinstated.

This scenario is textbook: what happens when you don't understand separation types from an HR legal perspective. If Manager B had known, this wouldn't have happened.

So what **types of separation** exist in HR management? They're classified by **_where the initiative comes from_**:

**1) Resignation: The employee voluntarily ends the employment relationship**
(e.g., "I'll work through the end of the month, then I'm leaving.")

**2) Mutual agreement (voluntary separation): Employer and employee mutually agree to end the relationship**
(e.g., Employer asks: "Would you be willing to work through this month?" Employee agrees: "Sure, I can do that.")

**3) Termination (dismissal): The employer unilaterally ends the relationship against the employee's will**
(e.g., Employer says unilaterally: "Today's your last day" or "Finish out the month — then you're done.")

**4) Contract expiration: A fixed-term contract ends on its specified date**
(e.g., Employment contract end date arrives)

**5) Mandatory retirement: Employment ends when the employee reaches a legally defined age (currently 60 in Korea)**
(e.g., Employee turns 60 during employment)

Among these five types, **'1) Resignation' and '2) Mutual agreement'** are governed by civil law — meaning mutual consent takes precedence and labor law doesn't apply. In contrast, **'3) Termination'** is governed by the Labor Standards Act, which prohibits dismissal without just cause and dismissal without written notice.

**'4) Contract expiration'** is governed by the Fixed-Term Employment Act, which converts contracts to indefinite-term after two years. **'5) Mandatory retirement'** is governed by the Senior Employment Promotion Act, which prohibits retirement ages below 60.

Because different laws apply to different separation types, **the first step in managing employee departures is determining what type you're dealing with.**

## 2. Does employee headcount change how separations work?

Once you understand separation types, you need to know which regulations apply to your property. Korean labor law applies different rules based on the number of regular employees. Separation management is no exception — the standards and procedures you must follow vary depending on your headcount.

**Regular employee count is calculated two ways under the Labor Standards Act:**

- First, calculate the average: total person-days worked in the month prior to the separation date, divided by the number of operating days. Since most accommodation businesses operate 365 days a year, you can use calendar days directly.
- Second, if your employee count was 5 or more for at least half the days that month — regardless of the calculated average — you're treated as a 5+ employee workplace.

#### [> Learn how to calculate regular employee count](https://corp.onda.me/insight-content/laborseocho-qna-04)

> **1) Workplaces with fewer than 5 regular employees**

If you have fewer than 5 regular employees, only the **advance notice rule** applies: you must notify the employee 30 days before termination. Other dismissal restrictions don't apply.

**What's the advance notice rule?**
A requirement to notify employees at least 30 days before termination

*Exceptions: employees with less than 3 months of continuous service; force majeure events that make continued business impossible; cases where the employee intentionally caused significant business harm

So in workplaces under 5 employees, giving 30 days' notice before separation is legally sufficient.

**⚠️ Caveat: Your count and the legal count may differ. Verify your actual regular employee count carefully.**

> **2) Workplaces with 5 or more regular employees**

If your property has 5+ regular employees, the 30-day advance notice rule applies **plus restrictions on grounds and procedures for dismissal**.

The Labor Standards Act requires **"just cause"** for employee termination. The Supreme Court defines this as "grounds that make continued employment relationship socially unacceptable" — judged case-by-case.

**⚠️ Critical point: In actual disputes, this standard is interpreted very strictly. What employers consider "just cause" often differs dramatically from what adjudicators accept.** For example, many employers view poor job performance as grounds for dismissal, but adjudicators may rule it doesn't even qualify as a disciplinary matter. **Consult an expert** before proceeding with termination.

Beyond grounds for dismissal, if your employment contracts, work rules, or internal regulations **specify dismissal procedures, you must follow them exactly**.

And if you have just cause and followed proper procedures, you **must notify the employee in writing**. **Verbal dismissal notices — even with valid grounds and proper procedure — are ruled unfair dismissals.** Just like what happened between Employee A and Manager B in our opening example.

Separation management differs by headcount. Know your exact regular employee count and which regulations apply.

## 3. Are there separation methods besides termination?

Workplaces with 5+ employees face strict dismissal procedures. But there are multiple separation types — and if it's not a dismissal, labor law doesn't apply.

**1) Resignation** and **2) Mutual agreement** are governed by civil law: no restrictions on timing or grounds. The only requirement is **_employee consent_**. If you and the employee reach agreement, the employment relationship can end smoothly without unilateral action. **Tip:** Always document the separation reason in writing to avoid confusion with verbal dismissal later.

Alternatively, separations like **4) Contract expiration** (when a fixed term ends) or **5) Mandatory retirement** (when the legal retirement age arrives) occur regardless of either party's intent — the contract simply terminates.

For **contract expiration**, your relationship with the employee must be fixed-term. This is determined by the employment contract — so **specify the contract term explicitly**. Note: Even contract employees are treated as indefinite-term after 2 years. And if you continue employing someone past their contract end date without notice, the contract is deemed renewed on identical terms.

For **mandatory retirement**, if your workplace has 10+ employees, whichever is more favorable applies: your work rules' retirement age or the statutory age (60). Also: if you keep employing someone past their retirement date, then later terminate them citing retirement, it may be ruled a dismissal.

## 4. How do you reduce separation disputes?

To sum up hospitality separation management:

1) Identify which separation type applies to the departing employee

2) Determine which legal regulations apply to your property (calculate regular employee count)

3) Assess whether separation is possible within the legal framework — and identify alternatives if not

4) Prepare necessary documents in advance (resignation letters, employment contracts, dismissal notices, etc.)

---

### _Closing the Series_

Current labor laws feel disconnected from the realities of Korea's tourism and hospitality industry. That makes proactive preparation critical. Manage the three must-have HR documents well — 1) employment contracts, 2) payroll ledgers, 3) pay stubs — and you'll build a dispute-free workplace.

To every accommodation operator struggling with HR management right now: we want to be a real source of support for you.

Thank you for reading this long series.

> **Hospitality HR Management Inquiries (Seocho Labor Law Firm)**

Website: [www.노무법인서초.com](http://bit.ly/laborseocho)

Blog: [https://blog.naver.com/cpla7582](https://bit.ly/laborseocho_blog)

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