Amid growing public criticism over a series of major industrial accidents this year, both the government and the National Assembly are introducing a succession of strong punitive legislative measures. This comes after President Lee Jaemyung signaled a hardline response, describing industrial accidents at large corporate construction and manufacturing sites such as POSCO E&C and SPC as "murder by willful negligence." However, the business community has expressed concerns that simply strengthening punitive measures, without first addressing the structural problems within the industrial ecosystem, could lead to significant negative side effects.
According to government and political sources on August 18, the Ministry of Employment and Labor is preparing measures to strengthen the existing penalty system in order to eradicate industrial accidents. An official from the Ministry stated, "There is a growing consensus that, when an employer neglects safety measures and an accident occurs, sanctions must go beyond mere fines and be strong enough to impact business operations themselves." However, the official added, "We are not considering proposals that would increase individual liability for workers in accident situations, which some have raised concerns about."
Specifically, the Ministry is reportedly considering revising the requirements for business suspension and restrictions on public bidding for companies in the event of an accident. Under the current Industrial Safety and Health Act, if 'two or more people die simultaneously' at a construction site, the Ministry of Employment and Labor can request the Ministry of Land, Infrastructure and Transport to suspend the construction company's business operations and restrict its access to bidding. The Ministry now plans to expand this to cover 'multiple deaths in a year.' This measure would strengthen the response based on the frequency of accidents, rather than just the scale of each incident.
The Ministry is also considering imposing fines on corporations in cases where multiple fatalities occur due to violations of safety protocols. Options being discussed include setting the fine as a fixed amount or as a certain percentage of the company's revenue. If fines are imposed as a percentage of revenue, it is expected to have a direct and substantial impact on business operations. In addition, if a fatal accident occurs again after a business suspension request, there is growing support for introducing a provision in the Industrial Safety and Health Act to request the cancellation of a construction company's registration. The government is also considering expanding the scope by identifying additional industries where business licenses could be revoked due to fatal accidents, beyond just the construction sector.
In the National Assembly, a series of proposed amendments are being introduced to implement punitive damages claims. According to the National Assembly's legislative information system, there have been 18 proposed amendments to the Industrial Safety and Health Act this year alone. Including amendments to the Labor Standards Act, the total reaches several dozen. Notably, Hwang Myungseon, Supreme Council member of the Democratic Party, has introduced a bill that would impose punitive damages of up to three times the actual damages on employers who repeatedly or intentionally violate the law. Cha Kyugeun, a member of the Rebuilding Korea Party, has submitted an amendment that would allow workers to stop working in dangerous climate conditions such as heat waves or cold spells, with the government compensating for any lost wages. Yoon Sanghyun, a lawmaker from the People Power Party, has also proposed a bill to require employers to install heating and cooling facilities to protect workers' health from climate change-related risks such as heat waves and cold snaps.
On the other hand, the industrial sector has argued that simply increasing penalties without addressing structural issues will not be effective in preventing industrial accidents. There is also significant debate over the effectiveness of the Serious Accidents Punishment Act, which the government implemented in January 2022. This law stipulates that if one or more fatalities occur, business owners or management can face at least one year in prison or a fine of up to 1 billion KRW, and corporations can be fined up to 5 billion KRW.
The problem, however, is that the number of deaths from industrial accidents has continued to rise even after the law was enacted. According to the Ministry of Employment and Labor, the number of industrial accident victims increased from 108,379 in 2020 to 142,771 last year. A survey by the Korea Employers Federation found that the number of fatalities at workplaces with 50 or more employees increased from 248 in 2021 to 250 last year. The business community has pointed to the government's lowest-bid tender system as a major factor in industrial accidents. Intense competition to win contracts at low prices leads to a vicious cycle in which contractors cut back on safety investments to reduce costs. A government official stated, "Based on suggestions from the business community and others, we are exploring various fundamental ways to reduce the human toll of industrial accidents."
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