[2020 National Audit] "Korea National Oil Corporation Must End Branch Staff Fine Payment Practice"

Governor to Share Fine Payment... Kang Hoon-sik "Headquarters Must Eliminate It"

Korea National Oil Corporation

[Asia Economy Reporter Moon Chaeseok] It has been revealed that at Korea National Oil Corporation, there was a practice where employees paid part of the fines the corporation had to pay for violations of the Customs Act, Occupational Safety and Health Act, and the Act on the Control of Pollutants and Waste Management out of their own pockets.

According to the "Fine Payment Status Survey" data submitted by Korea National Oil Corporation to Kang Hoon-sik, a member of the National Assembly's Industry, Trade, Energy, Small and Medium Enterprises Committee from the Democratic Party of Korea, on the 20th, it was confirmed that employees of the Geoje branch, Pyeongtaek branch, and Yeosu branch paid the company's fines personally among the corporation's nine branches.

At the Geoje branch, in 2014 and 2015, the person in charge and the team leader shared the payment of a fine of 400,000 KRW received for violating Article 157 of the Customs Act (prior notification of crude oil shipment in the customs system (EDI) before shipment).

At the Pyeongtaek branch, in 2016, safety team personnel shared the payment of a fine of 400,000 KRW for failing to comply with Article 24-2 of the Persistent Organic Pollutants Control Act (failure to report changes when replacing management target equipment (transformers) containing persistent organic pollutants with non-containing types).

At the Yeosu branch, in 2015, team members shared the payment of a fine of 500,000 KRW for violating Article 18, Paragraph 3 of the Waste Management Act (failure to enter daily data on the day of generation of household and food waste into the electronic information processing program).

Lawmaker Kang pointed out that the structure in which the imposition of fines is reflected in the evaluation of branch managers and the respective branches was a contributing factor. He explained that employees, conscious of evaluations, did not notify the headquarters, which is the entity responsible for paying the fines, and quietly paid the fines out of their personal expenses, creating this practice.

Another reason for this practice was that local offices of regulatory departments such as the Customs Service, Ministry of Labor, and Ministry of Environment inspected the branches where the facilities were located and, for convenience, notified the fine notices to the branches instead of the headquarters.

Lawmaker Kang criticized, "It is problematic that the fines the corporation must pay were passed on to employees, but it is also problematic that the headquarters has not been able to identify issues occurring at each branch and establish measures to prevent recurrence."

He added, "The headquarters should regularly check the fine issuance status of each branch and create measures to prevent recurrence when problems arise," and "If the practice of personal payment is detected, wrong practices should be eliminated by, for example, giving disadvantage points rather than advantage points in branch evaluations."