According to the Statistics Korea in 2016, 56.9% of companies do not fairly pay compensation for
employee invention, despite the increasing proportion of the inventions in corporations. One reason is that
the objective calculation method for employee and patent’s contribution and the clear standard of fair
compensation have not been established. Therefore, this study proposes a new calculation method using
DCF (Discounted cash flow) and AHP (Analytical hiearchy process) methodology to calculate the fair
amount of employee invention compensation, and verified it through real case examples. As a result, 2.3
times higher amount of compensation was calculated than the previous approach. This study is meaningful
that it provided objective compensation criteria that could more protect the inventor in the situation which
the clear criteria for the calculation of fair compensation are not established. This methodology is expected
to be applicable for SMEs as employee invention compensation.