Illegal Employment in Construction Sites Defies Crackdowns...No Visa Checks, Fooled by Forged Certificates [Construction Crisis Report]

Illegal Employment Rampant at Construction Sites
Focus on 'Protecting Domestic Workers,' Not 'Regulating Foreigners'
Domestic Worker Quota Needed to Reduce Dependence on Foreign Labor

Construction companies, driven into a corner by the economic downturn and fierce competition for low-cost contracts, often find themselves easily tempted to hire undocumented workers. Employing undocumented workers to reduce labor costs can serve as a practical measure to offset real-world pressures such as rising construction expenses and shortened project timelines.

In particular, the government's lax enforcement and lenient penalties have allowed this practice to become routine among construction firms. There are growing calls for improvement, as the employment of undocumented workers not only deprives domestic construction workers of job opportunities but can also lead to poor-quality construction.

Forged Completion Certificates Openly Used

Recently, an enforcement team from the Ministry of Justice raided a restaurant near a major construction site in Yeongdeungpo-gu, Seoul. This restaurant, known as a "Hamba-jip," was primarily frequented by foreign workers. At that time, more than ten foreigners dining there were immediately apprehended on suspicion of being undocumented.

Earlier, the government conducted its first joint crackdown on illegal employment of foreigners from April 14 to June 29, citing the protection of domestic jobs as justification. In Seoul alone, 115 individuals were caught and all were subject to forced deportation. A day laborer at a construction site commented, "If there were no foreigners, construction would come to a halt because so many are employed," adding, "Most of them are undocumented."

To determine whether someone is undocumented, visa verification is necessary. However, at most construction sites, this verification process is skipped. General contractors only formally check the "Basic Safety and Health Education Completion Certificate" for construction work. Since the responsibility for hiring lies with subcontractors, the attitude is, "Who they bring in is up to the subcontractor."

This certificate can also be forged for around 100,000 won in back alleys. Forged certificates are used to open bank accounts or enroll in the Construction Workers' Mutual Aid Association’s retirement fund. Banks accept these as proof of qualification and even issue accounts based on them.

At one construction site, out of approximately 200 workers, about 120 were found to be using forged certificates. Since last month, the Ministry of Employment and Labor has stopped issuing card-type certificates and switched to mobile certificates. However, criticism persists that the measure is ineffective because existing certificates are still accepted.

A construction worker is working at a construction site. Photo by Moon Honam

The Ministry of Employment and Labor and the Immigration Office, which are responsible for inspecting and cracking down on illegal employment, have neglected enforcement and are also inconsistent in their follow-up actions. Even when the Ministry of Employment and Labor uncovers illegal employment during on-site inspections and notifies the Immigration Office, the Immigration Office claims that "notification from the Ministry alone is insufficient to confirm a legal violation" and insists on conducting its own investigation. However, according to industry insiders, "in most cases, investigations are delayed due to the high volume of complaints."

Some testify that whether or not enforcement takes place depends more on the "atmosphere among higher-ups" than on the actual situation at the site or the judgment of government officials. One site manager stated, "Government crackdowns on the employment of undocumented foreigners are not a mandatory duty but are in practice just guidelines. Since there are no significant penalties for violations, people say that the intensity of enforcement at the site depends on who the minister is."

"A Domestic Worker Quota Is Needed"...Approach Should Focus on Protecting Domestic Workers, Not Regulating Foreigners

The previous administration granted a blanket amnesty for employment restrictions that the Ministry of Employment and Labor had imposed on construction companies. At the same time, the criteria for sanctions were scaled down from the "corporate level" to the "site level." Employment restrictions are the only administrative penalty the Ministry can impose on construction companies that hire foreigners without a permit. In addition, even when illegal employment is detected, it typically takes about six to nine months for actual sanctions to be imposed, often after the project has already been completed. As a result, the effectiveness of these sanctions has been virtually lost.

There is growing criticism that simply tightening regulations to ensure the employment of only legal foreign workers will not resolve the labor shortage and illegal employment issues at construction sites. Experts and labor groups are proposing practical alternatives, such as legally mandating that a certain proportion of the workforce be domestic workers, and restoring the Ministry's sanction criteria to the "corporate level."

The "domestic worker quota" system is being discussed as one way to reduce dependence on foreign labor in the construction industry. For example, a law could require that at least 30% of all workers be domestic, with penalties imposed for violations.

Order of Articles in the 'Construction Crisis Report' Series

<1-1> Construction Sites at a Standstill, Day Laborers' Lives Collapsing
<1-2> "Three to Four More Bankruptcies"...Mid-sized Construction Firms Targeted for Restructuring
<2-1> What Was Thought to Be a 'Lifeline' Became a 'Trap': Project Financing
<2-2> Easing Multi-homeowner Regulations, the Key to Reviving Local Real Estate
<3-1> "Every Day Is Nerve-racking": Shaken Subcontractors and Downstream Industries
<3-2> Even Large Firms Cannot Avoid Wage Arrears
<3-3> LH and Local Governments Also in Wage Arrears
<3-4> The President Steps In...Urgent Need for Vertical Structure Reform
<3-5> The Company That Survived Without Illegal Re-subcontracting
<3-6> Joining Hands at Collapsed Sites
<4-1> Foreign Construction Labor, Encroaching on Domestic Jobs
<4-2> Focusing on 'Protecting Domestic Workers,' Not 'Regulating Foreigners'
<4-3> The Fundamental Cause of Deteriorating Profitability: Frequent Rework