Enforcement of Serious Accident Punishment Act D-2... Law Firms Now in "Calm Before the Storm"

Corporate Dedicated Team Elevated to Headquarters and Centers
Comprehensive Situation Room and YouTube Channel Opened
Confusion Due to Lack of Appropriate Guidelines

[Image source=Yonhap News]

[Asia Economy Reporters Baek Kyunghwan and Kim Hyungmin] The law firm industry is in a state of "calm before the storm" just two days before the enforcement of the Serious Accident Punishment Act.

This is especially true as HDC Hyundai Development Company, the primary contractor involved in the Gwangju Hwajeong I-Park exterior wall collapse accident, is under heavy fire. Hyundai Development Company is undergoing intensive investigations by the Ministry of Employment and Labor, the prosecution, and the police, and Chairman Chung Mong-gyu has stepped down. Had the Serious Accident Punishment Act been in effect earlier, Hyundai Development Company might have been pushed even closer to the edge. Domestic law firms have been watching this process with bated breath. Some even said it did not feel like someone else's problem. Law firms anticipate that two days from now, when the Serious Accident Punishment Act is enforced, their main corporate clients will face challenges similar to or even more severe than those faced by Hyundai Development Company. Lee Siwon, Deputy Director of the Serious Accident Center at Law Firm Yulchon (Attorney), explained, "The Serious Accident Punishment Act is an issue that law firms, whose main clients are corporations, must devote all their efforts to assisting and advising on."

◆ Establishing Dedicated Teams and Focusing on Preemptive Measures = Law firms have been active since June last year. The task forces (TF) formed at that time were upgraded to "Centers" or "Headquarters" by the end of last year as more attorneys and experts joined. All of the so-called six major law firms have dedicated centers. These operate with teams ranging from as few as 25 to as many as 100 members. Their response is broadly divided into preemptive and post-incident measures. Currently, law firms are focusing on preemptive preparations. Law Firm Bae, Kim & Lee operates a "Comprehensive Situation Room" running 24/7. Law Firm Yulchon has launched a YouTube channel to provide information through broadcasts, and Law Firm HwaWoo has held multiple webinars. Attorney Park Joon-ki of Law Firm Bae, Kim & Lee said, "It takes at least two to three months for companies to prepare for matters related to the Serious Accident Punishment Act," adding, "Future serious accident incidents could have a tremendous impact across companies, so law firms are supporting them with full organizational capabilities."

◆ Ambiguous Punishment Standards, Transitional Period Unavoidable = Law firms also face many difficulties. The legal provisions, including punishment standards, are uncertain, leading to many variables. Attorney Lee said, "The law requires 'establishing standards and budgeting,' but there are no appropriate guidelines, so companies inevitably face confusion." The most sensitive part for companies is "holding corporate executives responsible for fatal accidents occurring during business operations." Until now, on-site supervisors bore responsibility for such accidents, but once the law is enforced, both on-site managers and the company's CEO will be investigated and potentially punished for legal violations. Whether executives are punished depends on court rulings. Foreign companies operating in Korea, whose decision-making authority lies with foreign headquarters, are also seeking legal counsel for this reason. Furthermore, from the law firms' perspective, they must closely monitor not only companies but also investigations by prosecutors and police, court judgments, and public opinion trends.

◆ The Ultimate Goal is a Smooth Transition = Law firm attorneys also sympathize with the intent and purpose of the Serious Accident Punishment Act. Attorney Park said, "Since there is already an established legal framework such as the existing Industrial Safety and Health Act, the enforcement of the Serious Accident Punishment Act will have an effect." Attorney Lee also predicted, "If the law is well established, it will have a positive effect in reducing accidents." However, the key issue remains how the ambiguous punishment standards and other major provisions will be applied in actual investigations and trials. Law firms prioritize resolving difficulties that companies may face, but they also plan to research and work toward the successful establishment of the law. Attorney Lee said, "Sometimes there is a misunderstanding that we only advise companies on how to avoid responsibility, but that is not the case," adding, "We provide extensive advice on how to properly establish industrial safety and health management systems."