[Foreign Employment Contracts and the E-7 Visa ⑦] Can a Company with Fewer Than Five Korean Employees Hire an E-7 Worker? — Hiring Ratios, Employer Size, and Employment Contracts

Hello, I am Administrative Scrivener Sangjin Ji.

In July 2026, skilled workers from Mongolia entered South Korea for the first time under the E-7-3 visa category for slaughterhouse workers.

The occupation had been newly introduced in response to persistent labor shortages in Korea's slaughtering industry.

This case highlights an important feature of the E-7 visa system.

Before hiring a foreign national, an employer must first determine which E-7 occupation accurately reflects the work the employee will actually perform.

But identifying the occupation and confirming the candidate's education and work experience is not the end of the assessment.

A candidate may qualify individually while the employer itself may still face restrictions on hiring that foreign worker.

When hiring an E-7-1 professional, a Korean company may also need to review the number of qualifying Korean employees, existing foreign employees, company size, and other employer-side requirements.

This article explains how Korean SMEs should review those issues before proceeding with an E-7-1 hire.

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A Company Has 10 Korean Employees and 2 Foreign Workers. Can It Hire One More?

Consider a hypothetical example.

A Korean IT company wants to hire a foreign web developer.

The candidate satisfies the relevant educational and professional qualification requirements, and the company has already discussed salary and employment conditions.

Before preparing the employment contract, however, HR reviews the company's workforce.

The company has 10 Korean employees who count under the applicable criteria.

It already employs 2 foreign workers who are included in the relevant hiring-ratio calculation.

The company now wants to hire one additional foreign web developer.

Would there be a problem?

Under the 2026 E-7-1 employment recommendation criteria of the Korean Ministry of SMEs and Startups, foreign web developers are generally limited to 20% of the qualifying Korean workforce under the relevant program.

Applying that standard to this example:

20% of 10 Korean employees is 2.

If the company already has 2 foreign workers and adds another, the total becomes 3.

The foreign-worker ratio after the new hire would therefore be 30%.

If all three foreign workers are included in the relevant calculation and no separate exception applies, the company would not satisfy the 20% threshold under that standard.

The candidate may be fully qualified.

The problem is now on the employer side.

The next question for HR should therefore be:

"After confirming the candidate's eligibility, does our company satisfy the employer requirements for hiring another foreign worker in this E-7 occupation?"

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Does Every E-7 Employer Need at Least Five Korean Employees?

An E-7 application should not be accepted or rejected based solely on the number of employees. The first step is to identify the intended occupation and determine which employer-side rules actually apply.

The 2026 E-7-1 employment recommendation criteria issued by the Korean Ministry of SMEs and Startups distinguish employer requirements by occupation.

A useful example is the difference between an Application Software Developer and a Web Developer.

Application Software Developer — Occupation Code 2223

Under the relevant employment recommendation criteria, the occupation is subject to salary and SME-related requirements.

The additional employment-ratio and employer-size fields specifically shown for web developers are not presented in the same way for this occupation.

Web Developer — Occupation Code 2224

For web developers, the recommendation criteria include not only salary and SME requirements but also separate employment-ratio and employer-size considerations.

Accordingly, the two occupations should not automatically be treated the same when a company uses the Ministry of SMEs and Startups' employment recommendation program.

However, another distinction is essential.

The Ministry of SMEs and Startups' employment recommendation criteria and the Ministry of Justice's final E-7 immigration review are not the same process.

Korean government guidance on employment of international students also describes restrictions involving domestic-oriented companies with fewer than five qualifying Korean employees and companies whose E-7 foreign workforce exceeds a specified ratio of Korean employees.

The precise application depends on the relevant occupation and the current E-7 immigration guidelines.

Therefore, the absence of a particular employer-ratio field in the Ministry of SMEs and Startups' recommendation criteria does not mean that every employer-related issue disappears from the final immigration review.

The correct approach is to identify the occupation first and then separately review the employment recommendation requirements and the final immigration requirements that apply to that case.

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If the Hiring Ratio Is a Problem, Can the Company Simply Change "Web Developer" to "Application Software Developer"?

Return to the hypothetical IT company.

The company calculates that hiring one additional foreign web developer would bring the relevant foreign-worker ratio to 30%.

HR then notices that the recommendation criteria do not display exactly the same employer-ratio requirements for application software developers.

This may lead to a tempting idea:

"Why not describe the position as an application software developer in the contract instead?"

If the actual job is web development, the company should not change the occupation merely to avoid an employer-side restriction.

Application Software Developer and Web Developer are separate occupations because their duties are different.

An application software developer generally develops and modifies software used by businesses or individuals.

A web developer generally handles technical responsibilities involving web servers and the application, testing, and operation of web technologies.

The company should therefore begin with the actual work.

What software will the employee develop?

What systems will the employee build?

What technical responsibilities will the employee actually have?

If the duties correspond to application software development, that occupation should be reviewed.

If the duties correspond to web development, the company must review the rules applicable to web developers.

If the role includes both, the principal duties should be compared with the official occupational descriptions.

The objective is not to select the occupation with the easiest employer requirements. It is to identify the occupation that accurately reflects the actual job.

If that sequence is reversed, the company may end up with one set of duties in the job description and a different occupation in the employment contract and visa application.

Changing a job title on paper does not eliminate an employer-eligibility issue.

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How Should the 20% Foreign-Worker Ratio for Web Developers Be Calculated?

To calculate an employment ratio properly, two figures must first be established.

First, the number of Korean employees who qualify under the applicable standard.

Second, the number of foreign employees who are included in the relevant calculation.

The company's total headcount should not automatically be treated as the number of qualifying Korean employees.

Under the 2026 Ministry of SMEs and Startups criteria for web developers, the Korean employee count is assessed by reference to factors such as enrollment in employment insurance, compliance with minimum-wage requirements, and the required period of enrollment.

For example, a company may say that it has 12 employees in total.

But if only 10 Korean employees satisfy the applicable counting criteria, the ratio should be calculated using 10 rather than 12.

The same principle applies to existing foreign employees.

Not every foreign national working for the company should automatically be treated identically.

The employer must determine who is included under the particular hiring-ratio rule that applies.

Only then should the proposed new hire be added to the calculation.

In the earlier example:

Qualifying Korean employees: 10

Existing foreign workers included in the calculation: 2

Existing ratio: 20%

After hiring one more qualifying foreign worker: 30%

Meeting the ratio before the new hire does not mean the company can automatically hire another foreign worker. The ratio must be recalculated after including the proposed employee.

If an employer identifies a possible headcount issue, it should confirm the applicable counting rules before finalizing the employment contract.

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Should a Startup with Fewer Than Five Korean Employees Give Up on an E-7 Hire?

Consider another hypothetical company.

It registered its business two months ago.

It currently has 4 qualifying Korean employees.

The company wants to hire a foreign web developer to build its own service.

Does the small workforce automatically make the E-7 hire impossible?

The first issue is not simply the number four.

The employer must identify the employer-size and application-timing requirements that apply to the intended occupation.

The 2026 Ministry of SMEs and Startups employment recommendation criteria include employer-size restrictions for web developers.

Under the relevant criteria, a domestic-oriented company with fewer than five qualifying Korean employees is generally restricted.

The web-developer criteria also contain rules regarding how long the company must have been registered before an application can be submitted.

The company in this example must therefore check two issues.

First, has the required period since business registration elapsed?

If the company has been registered for only two months, it must first verify whether it has reached the permitted application timing under the relevant recommendation criteria.

Second, how many Korean employees qualify under the applicable counting standard, and is the company primarily domestic-market oriented?

If there are only 4 qualifying Korean employees and the company is domestic-oriented, the employer-size restriction must be examined carefully.

The important point is how the rule is written.

The phrase "fewer than five Korean employees" should not be isolated and turned into a universal rule that every company with fewer than five Korean employees is prohibited from hiring an E-7 worker.

At the same time, merely planning to conduct overseas business does not automatically mean that the company should be treated as something other than a domestic-oriented company.

The company's actual business activities and the applicable rule must be reviewed together.

A requirement that applies to web developers should also not automatically be imposed on every other E-7-1 occupation.

For a startup, the proper sequence is: identify the occupation → identify the applicable employer requirements → compare them with the company's actual registration and employment history.

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Designers May Be Subject to a Separate Headcount Limit Instead of the 20% Ratio

The rules can also differ by profession.

The 2026 E-7-1 employment recommendation criteria provide separate hiring limits for designers based on the number of Korean employees covered by employment insurance.

Under those criteria:

If the employer has 5 to 49 qualifying Korean employees, the permitted number of foreign designers is 1.

If it has 50 to 99, the permitted number is 2.

If it has 100 or more, the permitted number is 3.

Consider a company with 20 qualifying Korean employees.

If it already employs one foreign designer who is counted under the relevant rule, the company should review the permitted headcount before attempting to hire another.

The 20% rule used in the web-developer example should not simply be applied to designers.

This illustrates the broader principle:

Even within the E-7-1 professional category, employer-side hiring rules may differ by occupation.

The occupation must therefore be identified before the employer calculates how many additional foreign workers it can hire.

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Is a Business Registration Certificate Enough to Prove Employer Eligibility?

The candidate qualifies.

The occupation has been identified.

The employer has checked the hiring ratio and company-size requirements.

Is a business registration certificate now sufficient?

No. Different company documents establish different facts.

The Ministry of SMEs and Startups' E-7-1 employment recommendation process uses materials such as a company introduction and a copy of the standard employment contract.

For occupations where workforce size is relevant, such as web developers and designers, employment-insurance records are also important.

Documents confirming SME status and other company information may also be required or verified during the process.

Each document serves a different purpose.

Business registration certificate

This identifies the legal business entity seeking to employ the foreign national.

SME confirmation

This helps establish whether the company qualifies as an SME for the relevant employment recommendation program.

Employment insurance records

These may be used to establish the number of qualifying Korean employees and relevant workforce size.

Company introduction

This explains the company's actual business activities and why the proposed foreign employee's duties are connected to those activities.

Standard employment contract

This records the proposed duties, salary, and other employment conditions.

The employer should therefore not think of the application as simply collecting a bundle of documents.

First identify the employer requirement. Then identify which document proves that requirement.

The documentation used for the Ministry of SMEs and Startups' recommendation process should also be distinguished from the documents required for the actual immigration application.

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Once the Employer Requirements Are Confirmed, How Should the Employment Contract Be Prepared?

Now the assessment can move to the employment contract.

Return again to the web-developer example.

Assume the company's foreign-worker ratio would rise to 30% after the proposed hire.

If that figure creates a problem under the applicable rule, the employer should first confirm that the headcount calculation is correct and whether any separate provision applies.

Changing the occupation name in the contract does not create eligibility if the underlying employer requirement is not satisfied.

Once the company has identified the correct occupation and confirmed the applicable requirements, it can prepare the employment contract required for the application.

Three sets of information should align.

Job description: the duties the foreign employee will actually perform.

E-7 application: the occupation selected based on those actual duties.

Employment contract: the real duties, salary, and agreed employment conditions.

A more professional-looking job title does not change the employee's actual duties.

The salary stated in the contract should also be consistent with the applicable E-7 salary requirement.

Another distinction is equally important.

Preparing an employment contract and beginning work are separate steps.

A copy of the standard employment contract may be required during the employment recommendation process, so an application-related contract can be prepared before final visa approval.

However, signing a contract or obtaining an employment recommendation does not by itself authorize the foreign national to begin regular employment.

The Ministry of SMEs and Startups' employment recommendation and the Ministry of Justice's final E-7 immigration decision are separate procedures.

The employer may prepare the contract required for the application, but actual employment should begin only after the foreign national has obtained the necessary immigration permission and lawful work authorization.

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What Should HR Review Before Signing the Contract?

A practical employer-side review can follow this sequence.

Step 1: Identify the E-7 Occupation from the Actual Duties

Determine the occupation based on the work the foreign employee will genuinely perform.

Do not begin with the preferred visa occupation and then rewrite the job around it.

Step 2: Identify the Employer Requirements for That Occupation

If the company uses the Ministry of SMEs and Startups' employment recommendation program, review the SME, employment-ratio, and company-size requirements applicable to the occupation.

The final Ministry of Justice immigration requirements should be reviewed separately.

Step 3: Calculate Qualifying Korean and Foreign Employees

Use actual employment records to determine the number of Korean employees who count under the applicable criteria.

Then identify the existing foreign employees who are included in the relevant calculation and include the proposed new hire.

Step 4: Match Each Requirement to Supporting Company Documents

Review the relevant employment-insurance records, SME documentation, company information, and other materials required for the selected application route.

Step 5: Prepare the Employment Contract Based on the Real Job

Check whether the job description, selected E-7 occupation, salary, contract date, and other application documents are consistent.

This sequence is a practical method for conducting a preliminary employer-side review.

Completing these steps does not guarantee final E-7 approval.

But it allows the company to identify where a potential problem exists before the employment contract and immigration documents are finalized.

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What Can the Company Check on Its Own?

If the occupation is clear and the company's employment-insurance records and existing foreign workforce are well organized, the employer can usually conduct an initial calculation of the hiring ratio or permitted headcount itself.

For example, if a company hiring a web developer has 10 qualifying Korean employees and already employs 2 foreign workers who are included in the relevant calculation, it can calculate the post-hire ratio before proceeding.

The company can also verify matters such as whether its SME confirmation is valid and how long it has been registered.

Closer review is useful when the actual duties could fall under more than one E-7 occupation, when it is unclear whether existing foreign employees should be included in the relevant ratio, or when the Ministry of SMEs and Startups' recommendation criteria and the Ministry of Justice's immigration requirements must be reviewed together.

The same applies where startup-specific employer-size rules or separate exceptions may be relevant.

The objective is not to inflate employee numbers or rewrite the occupation to make the company appear eligible.

The correct approach is to identify the rules that apply to the company's actual business and workforce, then determine whether those requirements can be objectively substantiated.

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Before Finalizing an E-7 Hire Based Only on the Candidate's Qualifications

An E-7 application does not end once the candidate's education and professional experience have been confirmed.

The employer must also determine whether the company itself is permitted to hire another foreign worker in the intended occupation.

Depending on the occupation, the company may need to review a foreign-worker ratio, employer-size restriction, or separate headcount limit.

The absence of a particular employer-side condition in one employment recommendation table also does not mean that all employer-related review disappears from the final immigration process.

The practical order remains the same:

Identify the occupation from the actual duties → review the employer requirements for that occupation → verify the workforce figures → prepare supporting documents → prepare the employment contract.

Where the occupation and workforce figures are clear, the company can conduct much of the initial review itself.

Where occupation classification, employee-counting rules, startup requirements, or separate exceptions are unclear, those issues should be reviewed before the contract and visa application are finalized.

If your company is considering an E-7 hire in Korea, a free initial review can help determine whether an additional foreign employee may be hired based on the intended occupation, number of qualifying Korean employees, existing foreign workforce, and the company's actual business activities.