What does the employer wage-arrears loan calculator help decide?
South Korea’s employer wage-arrears settlement loan finances unpaid wages and other eligible employment amounts.
The employer applies, but the funds are paid directly to workers rather than becoming unrestricted operating cash in the employer’s account.
This tool connects individual worker ledgers with agency-confirmed remaining capacities to estimate settlement funding, collateral requirements and cash still needed.
A small factory or shop owner may overestimate funding by looking only at total arrears.
Worker limits, existing loans and collateral can leave a substantial settlement gap.
Review the ordinary and special alternatives before committing household property or promising payment dates, and check repayment cash alongside the loan amount.
The tool does not determine approval, criminal-liability relief, settlement validity or substitute-payment entitlement.
Korean jurisdiction and rule datesVerified 2026-11-05 using rules effective 2026-08-20.
The supported review-date window is 2026-08-20 through 2026-12-31; historical rules and later amendments are not applied automatically.
Reference rates require a fresh check against the contract and any temporary reduction at application time.
Ordinary and special loan limits and periods
The August 2026 expansion increased ceilings, while preserving both employer and worker limits.
The special KRW 1 billion ceiling requires recent arrears, real-estate collateral, viable plans and a separate confirmation process; it is not a fixed grant.
Korean ordinary and special employer loan ceilings and repayment periods effective 2026-08-20| Condition | Ordinary | Special |
|---|
| Employer program ceiling | KRW 200,000,000 | KRW 1,000,000,000 |
| Per-worker ceiling | KRW 20,000,000 | KRW 20,000,000 |
| Grace period choices | 1 or 2 years | 2 or 3 years |
| Repayment after grace | 3 or 4 years | 4 or 5 years |
Do not add the ordinary KRW 200 million and special KRW 1 billion ceilings.
Outstanding ordinary borrowing is deducted from the special employer ceiling.
The special request itself must exceed KRW 200 million; if worker-level limits leave no more than that amount, review the ordinary route instead.
Employer and worker eligibility requires evidence
Employer evidence
Confirm at least six months of operation in a covered business.
Verify current operating status, industrial accident insurance coverage, closure or suspension, credit information and lending restrictions with the labor office, agency and bank.
A business start date alone does not establish every requirement.
Worker evidence
Current employees require at least six months of continuous work by the confirmation-application date.
Former employees require at least six months of continuous work and retirement within the preceding year.
Employment records and evidence of eligible unpaid amounts are both necessary.
For a 2026-11-05 review, a start on 2026-05-05 reaches the six-calendar-month boundary; a start the next day does not.
The calculator includes retirement on 2025-11-05 in its one-year window and excludes the previous day.
The authority must confirm recognized service, leave, business transfers and application-date treatment.
An excluded worker’s wages remain an employer obligation and stay in total settlement arrears.
Enter individual ledgers before applying the worker ceiling
- Use a unique anonymous ID such as W1. Add multiple unpaid entries inside the same worker rather than registering that person again.
- Enter verified occurrence dates and the eligible amounts still unpaid. Remove settled amounts and amounts already paid through substitute payments.
- Enter agency-confirmed remaining capacity for that worker. A default KRW 20 million value does not establish how previous borrowing or overlaps are treated.
- Verify the complete worker inventory, dates, eligible amounts and prior-loan overlaps before changing the complete-ledger evidence state.
Apply the cap once to each person
A worker with unpaid entries of KRW 15 million and KRW 10 million has KRW 25 million in arrears.
Combine the entries, then take the smallest of their total arrears, the KRW 20 million ceiling and their confirmed remaining capacity.
Even with full capacity, only KRW 20 million contributes to the reference ceiling and KRW 5 million needs other settlement funds.
Splitting one person across different anonymous IDs would incorrectly bypass this limit.
The screen supports up to 100 workers and 12 entries per worker.
These are interface limits, not statutory headcount limits.
Maintain larger ledgers separately and avoid substituting an average arrears figure multiplied by headcount for individual capped calculations.
Recent three-month unpaid arrears must exceed KRW 200 million
A special loan requires eligible unpaid arrears arising within the recent three months to exceed KRW 200 million as of the confirmation-application date.
Large historical arrears alone are insufficient.
The recent amount uses eligible unpaid arrears before worker loan caps, with settled amounts removed.
Date and amount boundaries
For 2026-11-05, this calculator’s calendar window is 2026-08-05 through 2026-11-05, inclusive.
It includes an occurrence on 2026-08-05 and excludes 2026-08-04.
KRW 200,000,000 does not exceed the threshold; KRW 200,000,001 does.
Confirm the recognized occurrence dates, eligible worker scope and complete ledger with the labor office rather than treating this calendar model as an official determination.
If worker evidence or the complete ledger is unverified, a partial recent total cannot establish a final special-loan amount.
The displayed total is the currently verified portion, not an approved amount.
Use payroll and payment records; do not move old entries to newer dates to satisfy the condition.
Existing borrowing and remaining capacities
Ordinary reference ceiling
Take the smallest of summed worker capacities, KRW 200 million and confirmed additional ordinary capacity.
Enter the agency/bank amount after prior-loan, repeat-borrowing, collateral and credit review.
The calculator does not infer every repeat-borrowing rule from the current outstanding balance alone.
Special reference ceiling
Compare summed worker capacities, KRW 1 billion minus outstanding ordinary borrowing, confirmed additional special capacity and the confirmed property value divided by 1.2.
An outstanding ordinary balance of KRW 100,000,000 reduces the special employer ceiling to KRW 900,000,000 before other limits.
A previous special borrower must wait three years from the most recent special-loan eligibility confirmation notice before a new application.
A latest notice on 2023-11-05 reaches the three-year boundary on 2026-11-05, while a notice on 2023-11-06 does not.
Confirm the treatment of prior special-loan balances, repeat worker borrowing and overlapping arrears through the institution’s additional-capacity figures.
Unverified capacities leave the funding assessment on hold.
The special loan’s 120% real-estate collateral condition
The special request requires property collateral worth at least 120% of the amount requested.
Use the value accepted by the institution, not an estimated market price.
Senior claims, recognized security value, the owner’s consent, availability of the mortgage and registration costs require separate confirmation.
Requesting KRW 240 million
KRW 240,000,000 × 120% requires KRW 288,000,000 in collateral.
A confirmed KRW 300,000,000 valuation has no gap for that request; collateral alone would support a reference ceiling of KRW 250,000,000.
A valuation of KRW 287,999,999 leaves a one-won gap and is not rounded up into compliance.
Its collateral-based ceiling is KRW 239,999,999: revise the request or verify additional collateral.
The calculator checks collateral against the original request rather than silently reducing the loan and treating the request as compliant.
A failed condition withholds the settlement assumption and repayment schedule.
The special 120% ratio is not automatically applied to ordinary mortgage borrowing; use the bank’s confirmed additional ordinary capacity.
Worked settlement and additional-cash example
Twelve workers with KRW 25 million each
Assume every worker is eligible, all arrears arose in the recent window and remaining capacities are verified.
Total arrears are KRW 300,000,000; applying the KRW 20 million worker ceiling produces KRW 240,000,000.
The ordinary reference ceiling is KRW 200,000,000.
The special option can support a KRW 240,000,000 plan with no ordinary balance, KRW 300,000,000 confirmed property value and all other conditions met.
Set the request itself to KRW 240,000,000 to satisfy the example’s collateral condition.
Even if this special loan is disbursed, KRW 60,000,000 remains unpaid.
With KRW 20,000,000 in own settlement cash, another KRW 40,000,000 is needed.
Before disbursement, do not treat the planned KRW 240,000,000 as secured money when promising payment.
The example’s evidence, valuation and verified-term states are fictional assumptions.
Total arrears include obligations to workers excluded from loan eligibility.
An amount that cannot be financed is not a waived wage obligation.
Enter only cash actually available for settlement, without also allocating the same funds to household expenses or business operations.
Separate principal and interest payment intervals
MOEL’s reference annual rates are 3.7% for credit or joint guarantees and 2.2% for collateral.
The Enforcement Rules set a 5% annual ceiling; verify the actual contract, temporary reductions and fees.
Ordinary periods are 1 or 2 grace years followed by 3 or 4 repayment years; special periods are 2 or 3 grace years followed by 4 or 5 repayment years.
Exceptional extensions are not applied automatically.
KRW 120 million ordinary mortgage budget
Assume KRW 120,000,000 at 2.2%, one grace year and three repayment years, with confirmed quarterly principal and monthly interest payments.
Grace-period monthly interest is KRW 220,000.
The first principal payment, in month 15, combines KRW 10,000,000 principal with KRW 220,000 interest for a KRW 10,220,000 payment.
Total modeled interest is KRW 6,930,000 and the final principal balance is zero.
Changing rates, periods or either payment interval changes the budget.
Each month accrues interest on opening principal at the annual rate divided by 12; accrued interest is paid at the end of the chosen interest interval.
After grace, equal principal installments fall at the end of each chosen principal interval, with the last installment clearing the whole-won remainder.
Interest is rounded to whole KRW on payment.
This is a budget, not a bank statement reproducing daily accrual, the actual drawdown date, first due date, holiday adjustments or exact rounding rules.
Mortgage registration, guarantee fees, early repayment and late-payment costs are excluded.
The monthly reserve is the largest payment-cycle total divided by that cycle’s months, rounded up.
Save that amount separately to prepare for principal-payment months.
Displayed monthly cash differences do not automatically carry accumulated reserves forward.
Enter the monthly cash available for this new loan after business expenses and existing-loan payments.
From calculation to application counseling
- Prepare business-start and worker employment records, payroll ledgers and payment evidence.
- Enter the complete worker ledger and compare individual ceilings and confirmed remaining capacities. Review excluded or unverified workers.
- Check whether both recent eligible arrears and the special request exceed KRW 200 million, then select the appropriate loan.
- Verify existing borrowing, collateral, additional capacities, repayment and priority plans, and previous special confirmation notices with the institutions.
- Resolve failures and unknown evidence, then revise the request within capacity. Verify the contract rate, periods and both payment intervals before viewing the schedule.
- Save the TXT review or print it for counseling alongside the worker ledger and repayment plan.
The ordinary process requires employer confirmation; the special process also requires special eligibility and plan review.
The Enforcement Rules require the loan application to reach the agency within 45 days of receiving the applicable confirmation notice.
This tool does not determine actual receipt, holiday treatment, supplementary-document periods or extensions; follow the notice and agency instructions.
Practical scenarios and interpretation limits
Before providing household property
Compare the wages left after the ordinary option with the extra amount potentially covered by the special option.
A collateral gap is different from a settlement cash gap: own cash does not automatically satisfy the mortgage condition.
Discuss repayment-failure risk, ownership and family consent separately before providing household property.
Before principal repayment begins
Interest-only grace months can appear manageable even when later principal-payment months are difficult.
Check both the peak-month shortfall and the reserve requirement, including a scenario where sales recovery is delayed.
The authority reviews whether repayment and vulnerable-worker priority plans are concrete and viable.
Unverified information is shown as pending, and unmet conditions withhold conditional funding.
Review outcomes, budgets, accepted collateral and prior borrowing may change actual amounts.
Wage delay interest, damages, repayment of substitute payments to the state and additional settlement premiums are outside this loan calculation.
Use the related employer total-exposure calculator for those obligations.
Inputs remain in the calculator; real names and account details are unnecessary, and the ledger is not sent to a server.
Frequently asked questions
Can a special loan settle all KRW 300 million of arrears?
Not automatically.
Check individual KRW 20 million limits, remaining capacities, recent arrears, collateral, outstanding ordinary borrowing and plan review.
Total arrears alone do not establish full financing.
Does exactly KRW 200 million of recent arrears qualify?
No.
The threshold requires more than KRW 200 million.
The special request must separately exceed that amount.
Does an ordinary mortgage loan also require 120% collateral?
The calculator applies 120% to the special loan only.
Enter agency/bank-confirmed additional ordinary capacity rather than assuming the same ratio.
Why enter the outstanding ordinary balance?
Unrepaid ordinary borrowing is deducted from the special KRW 1 billion ceiling.
Also verify additional capacity after repeat borrowing and worker overlaps.
Can former employees be included?
Confirm at least six months of continuous work, retirement within the preceding year and eligible unpaid amounts.
Excluded workers’ arrears remain settlement obligations.
Can a previous special borrower apply again?
Check that three years have elapsed since the latest special-loan eligibility confirmation notice.
Confirm how previous special borrowing affects remaining capacities.
Are 2.2% and 3.7% guaranteed current rates?
These are reference rates in the MOEL expansion announcement.
Enter the actual contract rate after checking temporary measures.
A schedule is withheld until rate, periods and payment intervals are verified.
Does a conditional plan mean the loan is approved?
No.
It is a plan derived from entered evidence states and amounts.
Agency and bank review, contracting and disbursement are still required; example states are fictional assumptions.
Official evidence and update record
On 2026-11-05 the National Law Information OPEN API returned the current Wage Claim Guarantee Act MST283451, Enforcement Rules MST289001 and Enforcement Decree MST285855.
This calculator uses Act Article 7-3 and Rules Articles 8-6 through 8-10 for eligibility, amounts and periods.
Special review was checked against MOEL Directive 251, administrative-rule ID 2100000284238, issued and effective 2026-08-20.
The KRW 200 million ordinary, KRW 20 million worker and KRW 1 billion special ceilings apply from 2026-08-20; older KRW 150 million and KRW 15 million guidance is not mixed into these calculations.
Future maintenance must recheck amendments, temporary rates, ordinary and special repeat borrowing, worker-level overlap limits, accepted collateral, payment intervals, daily accrual and fees.
Exceptional period extensions and individual evidence or entitlement decisions are not automated.
Prepare the ledger and collateral documents for counseling
Gather employment and retirement evidence, the unpaid-arrears ledger, ordinary and special borrowing histories, property valuation and repayment and vulnerable-worker priority plans.
Ask the labor portal or local labor office about confirmation, and contact the Korea Workers’ Compensation and Welfare Service at 1588-0075 or MOEL at 1350 for current conditions.
Review the obligations and cash requirements left after settlement before making payment promises or providing property.