Polarization mode dispersion (PMD) degrades the performance of Jones-matrix-based polarization-sensitive multifunctional optical coherence tomography (JM-OCT). The problem is specially acute for optically buffered JM-OCT, because the long fiber in the optical buffering module induces a large amount of PMD. This paper aims at presenting a method to correct the effect of PMD in JM-OCT. We first mathematically model the PMD in JM-OCT and then derive a method to correct the PMD. This method is a combination of simple hardware modification and subsequent software correction. The hardware modification is introduction of two polarizers which transform the PMD into global complex modulation of Jones matrix. Subsequently, the software correction demodulates the global modulation. The method is validated with an experimentally obtained point spread function with a mirror sample, as well as by in vivo measurement of a human retina.