This morning's shutdown-allowance article met the question "but the company says it gets a retention subsidy" with one line: that is money going to the employer under the Employment Insurance Act, and it does not change the allowance owed to you. This fills that gap. The state returns two-thirds of the allowance the employer paid - one-half at a large firm. Read the provision to its end, though, and there is one more step: cut more than half the month's contract hours and a large firm gets two-thirds as well, because item (ii) of Decree art. 21(1) carries no large-firm bracket.
1. The base is the shutdown allowance. Notice art. 10(2) states that "money paid" follows art. 46 of the Labor Standards Act - 80,382 a day for ten workers over ten days is 8,038,200.
2. A priority-support firm gets 5,358,800 back, a large firm 4,019,100. Net cost 2,679,400 against 4,019,100 - and that large firm reaches the priority-support figure by cutting to 50% (13,397 more per worker per day).
3. The cap is 68,100 per worker per day. Not a fixed figure but the greater of 60% of the benefit-base ceiling (113,500) and 80% of the eight-hour minimum daily wage - the same figure as the daily unemployment-benefit cap.
It reads art. 21 of Korea's Employment Insurance Act, arts. 19, 20, 21 and 68 of its Enforcement Decree, art. 24 of the Enforcement Rule, and the Ministry notices on the retention subsidy (No. 2026-30, in force 12 May 2026) and its cap (No. 2019-61) as written. The Decree amendment of 6 May 2026 replaced the old shutdown/leave split with a single test: the share of contract hours cut. The measure qualifies where the employer cuts 20% or more of the month's contract hours and pays money to make up the wage for the hours cut (art. 19(1)). The rate is 2/3 at a priority-support firm and 1/2 at a large firm - but 2/3 at a large firm too once the cut reaches 50% of the month (art. 21(1)(i),(ii); Notice art. 10(1)). "Money paid" follows art. 46 of the Labor Standards Act (Notice art. 10(2)) - the shutdown-allowance calculator works that figure out. The cap per worker per day is the greater of 60% of the benefit base ceiling (113,500 won) and 80% of the minimum daily wage (8 hours) (art. 21(5) and the cap notice) - 68,100 won in 2026. Days are capped at 180 per insurance year (art. 21(2)); the plan is filed by the day before the measure starts and the claim within 3 months of the month's end. It does not judge whether the employer faces unavoidable employment adjustment (a 15% sales drop and the like, Rule art. 24). An estimate - confirm on Work24 or with the call centre (1350).
A large firm gets two-thirds too, once it cuts past half
Decree art. 21(1) splits the amount into two items. Item (i): "where the total hours cut by the measure is under 50% of the calendar month: two-thirds of the money paid (one-half for a large firm)". Item (ii): "where it is 50% or more: two-thirds of the money paid".
Item (ii) has no bracket. Art. 10(1)(ii) of the Ministry notice spells it out: "large firm: 1/2 of the money paid (provided that where the total hours cut reaches 50% of the calendar month, 2/3)". On an 80,382 daily allowance that moves the subsidy from 40,191 to 53,588 per worker per day - a step of 13,397. A priority-support firm has no such step: it is at two-thirds from the start, whatever the cut.
At the left end of that line sits another threshold. Art. 19(1) defines the measure as "cutting 20% or more of a calendar month's contract hours and paying money to make up the wage for the hours cut". Below 20% there is no measure at all - and with no measure there is no subsidy, whatever was paid.
"Money paid" means the shutdown allowance
What the whole calculation rests on is settled not in the Decree but in the notice. Art. 10(2): "the ‘money paid to the worker' in paragraph 1 follows art. 46 of the Labor Standards Act". Art. 46 is the shutdown allowance - at least 70% of the average wage where the employer shuts down for its own cause, or the ordinary wage where that 70% exceeds it.
So the two calculators run into one another. A worker on a 3m won monthly ordinary wage has a daily allowance of 80,382, and paying ten of them for ten days costs 8,038,200. At a priority-support firm the state returns 5,358,800, leaving the employer 2,679,400; at a large firm that cut only 30%, only 4,019,100 comes back and the employer carries 4,019,100. Cutting to 50% brings that firm 1,339,700 more over the ten days.
What matters is that the whole bar is money the employer has already paid. The worker receives the same in all three - art. 46 decides that. The subsidy arrives afterwards, and it arrives at the employer.
The daily cap is not a fixed figure
Art. 21(5) says only that the subsidy "may not exceed the amount the Minister sets by notice per insured person". That notice - the cap notice, and the identical sentence in art. 5(1) of the claiming notice - gives not an amount but a formula: "60% of the benefit-base ceiling under Decree art. 68; provided that where that is lower than 80% of the daily minimum wage (applying 8 hours), the latter".
Put the 2026 figures in: 113,500 × 60% = 68,100, and 10,320 × 8 × 80% = 66,048. The greater, 68,100, is the cap. If the number looks familiar, it should - it is the daily cap on unemployment benefit, because both grow out of the same benefit-base ceiling in art. 68. More exactly: the unemployment article's cap of 68,100 and floor of 66,048 are the very two figures compared here - the retention subsidy's daily cap lands on the greater of the jobseeker benefit's own cap and floor. That ceiling rose from 110,000 to 113,500 on 23 December 2025, so a retention cap that sat at 66,000 for years became 68,100. Guidance still saying "66,000 a day" is quoting the figure from before that amendment.
The proviso will win one day. For the minimum-wage side to pass 68,100, the hourly minimum must exceed 10,641 - at 10,320 in 2026 it does not yet.
Past 102,152 a day the subsidy stops rising
Turn the cap around and it says this: to clear 68,100 after taking two-thirds, the daily payment has to reach 102,152. On a large firm's one-half it takes 136,202 - the lower the rate, the later the cap bites.
Because the allowance itself is capped at the ordinary wage (the art. 46(1) proviso), this shows up where the ordinary daily wage passes 102,152 - roughly above a 2.67m won monthly wage. Above that the subsidy stops at 68,100 per worker per day however high the pay goes, and the employer's own share grows with the wage from there.
What trips employers first is the dates
Get the rate and the cap right and the procedure can still end it. Art. 20(1): the plan must be drawn up month by calendar month and filed by the day before the measure is due to start, and it must go through consultation with the workers' representative. Filing afterwards is open only for the unavoidable causes in art. 20(2), such as a declared special disaster zone.
Covered workers are those 90 days past insured status; day labourers, workers already given notice of dismissal, workers due to resign at the employer's urging, and the employer's spouse and lineal relatives are excluded (art. 19(1)). On the employer's side, Rule art. 24 asks that sales in the reference month - the month before the one in which the measure starts - be down 15% or more on the average of the preceding six months, or that three-month averages be in continuous decline, or that the head of the employment security office so recognises. Days are capped at 180 per insurance year (art. 21(2)) and the claim is due within 3 months of the month's end (Notice art. 6(3)(i)).
And the sharpest line in the provision: the subsidy is paid only where the employer has not let an insured worker go through employment adjustment "during the measure and for one month after it" (art. 19(1)). Hiring someone new during the measure costs that month's subsidy too (art. 19(2)(i)).
Questions that remain
How is "the total hours cut" counted?
The text only says to compare it with "a calendar month's contract hours". Whole days off or a little less each day both seem to add up over the month, but the actual figure is worked out by the employment centre from the plan and the attendance records. This calculator takes the share as an input.
What if the time off is unpaid?
That is a different scheme - the unpaid retention subsidy in Decree art. 21-3, which needs a measure of 30 days or more and Labor Relations Commission approval (LSA art. 46(2)), and which pays the worker. This article covers the paid side only — the minimum headcount and the half-of-average ceiling are what the unpaid retention subsidy calculator works out.
What about agency and subcontracted workers?
Art. 19(4) handles them separately: where the measure happens at the using or main employer's site, the hours cut are computed there and the subsidy goes to the agency or subcontracting employer. The conditions differ, so this calculator leaves them out.
We received the subsidy within the last two years.
Art. 19(2)(iii): where the employer received it in the two years before the measure, nothing is paid if it lets 10% or more of its insured workers go through employment adjustment within six months of the measure's last day. Repeating a measure in the same month for three consecutive years bars it too (item (ii)).
Sources
Korean Law Information Center, Employment Insurance Act - statute text (in force 20 Aug 2026) - art. 21(1) (support for employment adjustment: shutdown, leave and similar measures, supported as prescribed by decree).
Enforcement Decree of the Employment Insurance Act - decree text (in force 1 Jul 2026) - art. 19 (eligibility: the 20% cut, 90 days, exclusions, the month after, disqualifying acts, agency and subcontract cases), art. 20 (the plan: by the day before, consultation with the representative), art. 21 (amount: 2/3 and a large firm's 1/2 under 50%, 2/3 at 50% or more, 180 days per insurance year, the per-person cap), art. 68 (benefit-base ceiling of 113,500 won, amended 23 Dec 2025). Arts. 19 and 21 took their present shape in the amendment of 6 May 2026.
Enforcement Rule of the Employment Insurance Act - rule text - art. 24(1) (unavoidable employment adjustment: sales down 15% or more in the reference month, a continuous three-month decline, or recognition by the head of the employment security office).
Ministry of Employment and Labor Notice No. 2026-30, on claiming and paying the retention subsidy - in force 12 May 2026 - art. 2(ii) (paid and unpaid measures defined), art. 4 (covered workers), art. 5 (the cap), art. 6 (support and claim periods), art. 10 (computation - (1)(ii) the large-firm proviso, and (2) "money paid" follows LSA art. 46). The cap formula appears in the same words in Notice No. 2019-61 on the subsidy cap.
Calculator verification. 1,008 combinations (seven daily payments including both sides of the cap boundary × six cut shares including the 20% and 50% boundaries × two firm sizes × three measure lengths × two headcounts × two used-day figures) were checked against the statutory arithmetic in both languages - the rate, the daily subsidy, the cap, the days supported, the total, the employer's share and the presence of each of the four notes - and in all 168 cases where a large firm cut 50% or more the daily subsidy matched the priority-support figure.
Left for another day
Counting the hours cut. The employment centre works it out from the plan and the records; this calculator takes the share as an input.
Whether the adjustment is "unavoidable". Judging the sales test is outside the text.
The unpaid subsidy and the agency and subcontract cases. Decree arts. 21-3 and 19(4) are not covered here.
Based on the 2026 provisions and notices. The 20%, 50%, 2/3, 1/2, 180 days, 90 days and the cap formula are the statute's; 68,100, 102,152, 13,397 and the example amounts are our arithmetic. The calculator is an estimate and judges neither eligibility nor the filing of the plan - confirm on Work24 or with the Ministry of Employment and Labor call centre (1350).
