Please tell me how to respond to a wage non-payment report.

Hello. I am a corporate specialist attorney at Daeryun Law Firm.

If an employer fails to pay wages owed to a worker within the prescribed period, they may be subject to imprisonment for up to 3 years or a fine of up to 30 million won under the Labor Standards Act.

Once a wage non-payment report is received, the competent labor office investigates the facts and comprehensively examines the amount of unpaid wages, whether they have been paid, and the intent to pay.

However, just because you are reported does not necessarily lead to punishment, and the following responses are important.

Paying the unpaid wages first is the best.

Even if a worker reported wage non-payment, in many cases, if the unpaid wages are paid promptly and a smooth settlement is reached with the worker, the case is closed by withdrawal of the complaint.

Also, explaining the financial circumstances is another method.

You should prepare materials (financial statements, sales ledgers, etc.) that can prove the circumstances of the delayed wage payment and current objective managerial difficulties such as poor sales, and faithfully explain them during the labor office investigation.

If you have paid the unpaid wages and reached a settlement with the worker, you should clearly document this by creating a wage payment confirmation or settlement agreement to prevent future problems.

Wage non-payment is an offense that cannot be prosecuted against the victim's will, so if a settlement is reached with the worker, criminal punishment can be avoided, so we strongly recommend receiving assistance from a specialized attorney with extensive experience in handling settlements.

By proceeding with the entire process from investigation response, document preparation, settlement agreement preparation, and defense in future criminal procedures together, the employer can also minimize disadvantages.

If you have been reported for wage non-payment, the level of punishment varies depending on whether the employer acted intentionally, whether unpaid wages were paid, and the possibility of settlement with the worker.

It is most important to quickly resolve the unpaid wage issue and reach a smooth agreement with the worker, and if necessary, it is wise to receive consultation with a corporate specialist attorney to establish a response strategy.