Business Community Expresses Concern Over "Excessive Sanctions" as Industrial Safety Act Amendment Passes National Assembly

Penalty of 5% of Operating Profit for Fatal Accidents
"Excessive Double Punishment"

On October 1, the business community expressed serious concern over the recently passed amendment to the Industrial Safety and Health Act, stating that the legislation fails to take into account the realities of the business environment.

Yonhap News Agency

The Korea Employers Federation issued a statement that day, saying, “The latest amendment stipulates that if there are three or more fatalities per year, a penalty of up to 5 percent of operating profit may be imposed. This represents an excessive and unrealistic standard. For large-scale businesses, the penalties could reach astronomical sums, and for small and medium-sized enterprises, it could have a severe impact on their very survival, which is extremely concerning.”

The Federation commented, “Although there have been recent legislative actions such as amendments to the Industrial Safety and Health Act and the enactment of the Serious Accidents Punishment Act that strengthen business owner liability, the policy effects of post-accident penalties have been limited. The introduction of a strong financial penalty system as an additional measure is an excessive sanction on business owners, and it will be difficult to expect any substantial improvement in industrial accident prevention.”

They also pointed out, “The requirements for employees to invoke a work stoppage have been relaxed to situations where there is a ‘serious or potential danger.’ However, since the standards for such judgments are unclear, inevitable disputes and conflicts about whether and to what extent work should be halted will arise between labor and management. The absence of clear standards increases the likelihood of subjective and arbitrary judgment by stakeholders, which can exacerbate confusion on-site and the potential abuse of the system, making this highly undesirable.”

The Federation urged, “We request that lawmaking efforts avoid an exclusive focus on strengthening business owner sanctions and instead foster rational discussions aimed at supporting practical improvements in safety management capabilities. We also ask that the government put effort into preparing subordinate legislation and application guidelines to minimize side effects when the law comes into effect.”

This content was produced with the assistance of AI translation services.