First Day of Serious Accident Punishment Act Enforcement... Economic Groups Say "Confusion Due to Fear of Punishment" (Comprehensive)

KCCI, FKCCI, and Industrial Union Forum Announce Positions on Serious Accident Punishment Act
"Even Compliant Companies Are Not Free from Punishment Fear. System Improvement Needed"
"Presidential Candidates Should Pledge Supplementary Legislation... Specific Safety Duty Must Be Clearly Stated"

On the first day of the Serious Accidents Punishment Act enforcement, which allows for the punishment of management officials when serious accidents such as worker fatalities occur, managers are conducting a safety inspection at an apartment construction site in Gyeonggi Province on the 27th. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporters Kiho Sung, Sunmi Park] As the “Serious Accidents Punishment Act,” which punishes business owners or management officials if safety and health management negligence causes fatal accidents, takes effect on the 27th, the business community has expressed great concern. Economic organizations have simultaneously announced that not only supplementary legislation but also urgent alternative measures from presidential candidates of both ruling and opposition parties are needed.

According to the business community, the Korea Employers Federation (KEF) stated in its “Business Community’s Position on the Enforcement of the Serious Accidents Punishment Act” that "the current Serious Accidents Punishment Act imposes excessive penalties and has unclear legal provisions, making it a reality that even companies making great efforts to comply with obligations are not free from the fear of punishment."

Enacted following the 2020 Icheon logistics warehouse fire, the Serious Accidents Punishment Act imposes overlapping penalties including imprisonment of more than one year for business owners in case of serious accidents including fatalities, fines on corporations, and punitive damages. However, the business community views the Serious Accidents Punishment Act as “punishment aimed at management responsibility,” since the existing Industrial Safety and Health Act already sets regulations for preventing most accidents.

The Federation of Korean Industries (FKI) also issued a statement on the same day, pointing out that "due to the excessively broad scope of application and ambiguous obligation regulations, some workplaces have even suspended operations to avoid being the first subject of punishment." The FKI urged, "During the law’s enforcement, excessive investigations and punishments should not occur unless there is clear intentional negligence by management."

The Korea Industrial Association Forum (KIAF) also stated on the same day, "According to the Ministry of Employment and Labor, in 2020, there were 671 workplaces with serious accidents under the Industrial Safety and Health Act, of which 80% were small-scale workplaces with fewer than 50 employees, raising concerns about the contraction of small businesses." It added, "According to a survey by the Korea Federation of SMEs, the main cause of industrial accidents is overwhelmingly high at 75.6% due to workers’ carelessness and non-compliance with guidelines, so safety standards compliance obligations should be imposed not only on business owners and management but also on workers to strengthen industrial safety."

The business community spoke with one voice regarding legal improvements. KIAF said, "We will propose amendments to the government and the National Assembly," and "plan to urge presidential candidates to pledge supplementary legislation within one year after the law’s enforcement." KEF also urged, "The business community demands that the problems of the Serious Accidents Punishment Act, which holds only management responsible for industrial accidents and imposes excessive penalties due to unclear obligation regulations, be reasonably amended through legislative supplementation as soon as possible."