Non-Compete & Non-Solicitation Penalty and Damages Calculator

Non-Compete & Non-Solicitation Penalty and Damages Calculator helps estimate Korea-related workplace harassment, disciplinary relief, platform worker rights, whistleblower protection, and labor dispute assumptions in English.

Legal scenario inputs

Enter Korea-related court, traffic, debt, family, civil, medical-dispute, criminal, or real-estate dispute assumptions. Results are simplified planning estimates.

Labor claim recognized amount

₩12,000,000

Offset or paid amount

₩5,000,000

Net planning amount

₩7,000,000

Monthly planning amount

₩583,333

₩8,000,000 unrecovered

This English page is a simplified Korea-related legal, administrative, digital, consumer, intellectual property, criminal, real-estate, platform, or civil dispute planning estimate. It is not legal advice and does not replace lawyer review, court decisions, police or agency notices, settlement negotiations, official fee tables, or case-specific evidence review.

Related calculators

What is the Non-Compete Penalty & Damages Calculator?

This tool diagnoses disputes over non-compete agreements (post-employment bans on working for or founding a competitor) and non-solicitation or confidentiality agreements signed when leaving a job.
Whether you are the departing employee or the employer, it estimates three things: whether the agreement is valid, how much of the contractual penalty a court is likely to enforce, and the scale of damages if a trade secret was misused.

This calculator is based on Korean rules (2026). A non-compete restricts the freedom to choose an occupation protected by Article 15 of the Korean Constitution, so courts do not treat such agreements as automatically valid.
The Supreme Court weighs five factors and voids overly broad agreements under Article 103 of the Civil Act (Supreme Court Decision 2009Da82244, 11 March 2010). This is a planning estimate, not legal advice, and does not replace a lawyer’s review or a court’s discretion.

Who needs this

  • • Employees who signed a non-compete before changing jobs or resigning
  • • People considering a start-up in the same industry who worry about the penalty
  • • Employers who want to claim damages for a non-compete breach
  • • Companies gauging the size of trade-secret misappropriation damages
  • • Anyone unsure whether an in-employment non-solicitation penalty is even enforceable

The five-factor validity test (Supreme Court 2009Da82244)

Korean courts judge a non-compete’s validity by weighing several circumstances together rather than a single rule.
If any factor is badly lacking, the whole agreement can be void, or its period and scope can be cut back.

1. A protectable interest of the employer

There must be a clearly protectable interest such as a trade secret, core technology, or proprietary know-how.
General knowledge, personal networks, or ordinary client relationships acquired on the job are usually not enough.
If there is no protectable interest at all, the agreement can be void regardless of the other factors.

2. Compensation (the most decisive factor)

Because the ban limits the worker’s freedom to work, whether the employer paid meaningful compensation matters greatly.
A non-compete imposed with no separate compensation or transition pay is likely to be held void in practice.
An employer’s claim that pay was “already included in salary” is rarely accepted without explicit terms.

3. Period, region, and job scope

The shorter and narrower the restriction, the more likely it is upheld.
Roughly six months to one year is often accepted, while a term over two years or a nationwide ban across an entire industry tends to be seen as excessive, leading a court to void it or shorten the period and scope.

4. Prior position & 5. Circumstances of leaving

An executive or core R&D / sales employee with access to important information makes a non-compete more justifiable, while for an ordinary employee the need is weaker.
If the worker left voluntarily the ban is easier to enforce, but where the employer dismissed the worker for its own reasons, the employer’s ability to invoke the non-compete is significantly limited.

Labor Standards Act Article 20 — in-employment penalties are void

Article 20 of the Labor Standards Act (effective 23 October 2025) provides that an employer may not enter a contract fixing a penalty or predetermined damages for breach of the labor contract.
So a clause presetting a penalty for breaching an in-employment duty, such as a no-transfer clause, is void from the outset.

This article, however, targets breach of the labor contract during employment.
A penalty for breaching a post-employment non-compete is treated as breach of a separate agreement rather than breach of the labor contract, so case law holds that Article 20 does not apply directly.
The calculator automatically flags an Article 20 void once you enter the dispute timing and the cause of the penalty.

Civil Act Article 398 — penalty reduction vs. a pure penalty

Even a valid penalty clause is not enforced at face value.
Article 398(2) of the Civil Act (effective 17 March 2026) lets a court reduce a predetermined damages amount that is unfairly excessive.
Article 398(4) also presumes that an agreed “penalty” is a predetermination of damages, so a penalty is in principle subject to reduction.

Predetermined damages vs. a pure penalty (위약벌)

  • Predetermined damages: claimable without proving actual loss, but a court may reduce an unfairly excessive amount.
  • Pure penalty: a punitive charge that is not reduced under Article 398(2), yet can be wholly or partly void under Article 103 if excessive.

The calculator checks whether the agreed amount is excessive relative to the reference harm (the largest of proven loss, trade-secret damages, or a salary-based proxy) and, combined with the validity verdict, shows an expected enforceable range.
When the agreed amount greatly exceeds three times the reference harm, the upper bound is pulled down to reflect a conservative reduction.

Trade-secret damages (Unfair Competition Prevention Act)

Non-compete disputes frequently overlap with trade-secret leaks.
Article 11 of the Unfair Competition Prevention and Trade Secret Protection Act imposes liability on anyone who harms a trade-secret holder by intentional or negligent misappropriation.

Damage presumption and punitive damages

  • • Infringer’s profit (Art. 14-2(2)): the profit gained from the infringement is presumed to be the loss.
  • • Reasonable royalty (Art. 14-2(3)): the amount ordinarily payable for using the trade secret may be claimed as damages.
  • • Up to 5x for willful infringement (Art. 14-2(6)): willful trade-secret misappropriation allows punitive damages of up to five times the recognized loss.

The punitive multiplier was introduced at three times in 2019 and raised to five times by the amendment of 20 February 2024.
The calculator takes the largest of the infringer’s profit, the reasonable royalty, and proven loss as the base, and where the act was willful, it also shows the range up to five times that base.

How to use this calculator

Step 1: Enter the agreement basics

Choose the dispute timing (during vs. after employment), the agreed penalty amount, and the penalty type (predetermined damages or a pure penalty).
Selecting “during employment” adds a cause field to test the Labor Standards Act Article 20 void.

Step 2: Enter the five validity factors

Enter the protectable interest, prior position, restriction period, scope, compensation paid, and how the worker left.
Each factor is scored and feeds the validity verdict.

Step 3: Enter trade-secret misuse (optional)

If a trade secret was leaked, tick the box and enter the infringer’s profit, royalty, proven loss, and whether it was willful.
Damages under the Unfair Competition Prevention Act are estimated too.

Step 4: Review the results

See the validity score and verdict, the five-factor diagnosis, the expected enforceable penalty range, the damages range, the expected total exposure, and warnings and recommendations.
Use the share button to copy a summary.

Frequently asked questions

Q. Must I honor a non-compete I signed with no compensation?

A. A non-compete with no compensation is likely to be held void under Korean case law.
If the protectable interest is strong and the restriction is short, some validity may survive, so review the specific facts with a professional.

Q. A KRW 30 million penalty — do I really pay it all?

A. A penalty is presumed to be predetermined damages and a court reduces an unfairly excessive amount.
If the sum is far above the actual loss, it can be reduced substantially; the calculator shows an expected enforceable range.

Q. How long a non-compete period is valid?

A. There is no fixed rule, but roughly six months to one year is often accepted.
A term over two years tends to be treated as excessive and may be voided or shortened by a court.

Q. What is the difference between a penalty and a pure penalty?

A. Predetermined damages are claimable without proving loss and can be reduced if excessive.
A pure penalty is not reduced under Article 398(2) but can be void under Article 103 if it is excessive.

Q. How much for leaking a trade secret?

A. Loss is presumed from the infringer’s profit or a reasonable royalty, and willful misappropriation can cost up to five times the loss.
To be protected, the information must meet the secrecy-management and specification requirements of a trade secret.

Tips and cautions

  • Check compensation first: validity turns largely on whether compensation was paid. Review any transition pay or bonus tied to the ban.
  • Keep it narrow: as an employer, a reasonable period, region, and job scope make the agreement easier to enforce.
  • Mind in-employment penalties: a preset penalty for breach of the labor contract during employment is void under Labor Standards Act Article 20.
  • Secure evidence: trade-secret damages hinge on proving secrecy management, specification, and the act of misuse.
  • Estimates only: results simplify case-law standards for reference; actual outcomes depend on the court’s discretion.

Diagnose your agreement now

Check the validity of a non-compete, the odds of penalty reduction, and trade-secret damages in one place.

Inputs stay in your browser and are not sent to a server. Results are reference estimates under Korean law, so consult a professional for a specific dispute.