Workplaces with 3 or More Industrial Accident Fatalities Face Fine of Up to 5% of Average Operating Profits... OSH Act Amendments Promulgated

Expand Workers’ Right to Stop Work and Introduce Rewards for Reports
Extend Safety and Health Management Expense Requirements Beyond Construction

A legal basis has been established for imposing a fine of up to 5% of a company’s average operating profit over three years on workplaces where at least three workers die in industrial accidents. Workers will also have broader authority to stop work when they fear an imminent danger.

The Ministry of Employment and Labor said on the 27th that amendments to the Occupational Safety and Health Act containing these provisions had been promulgated. The amendments codify key measures from the comprehensive labor safety plan announced in September last year. Their main aims are to strengthen financial penalties for repeated fatal accidents and improve systems for preventing industrial accidents at worksites.

On the first day of the Serious Accidents Punishment Act’s implementation, which allows business owners to be held responsible for fatal workplace accidents, managers conduct a safety inspection at an apartment construction site in Gyeonggi Province on the 27th. Photo by Kim Hyunmin.

Under the amendments, a fine will be imposed if an employer violates its safety and health obligations under the Occupational Safety and Health Act and at least three workers die in industrial accidents within one year of the Act’s effective date. The fine will be set at up to 5% of the company’s average operating profit over three years. If the company has no average operating profit, it is difficult to calculate that figure, or 5% of its operating profit is less than 3 billion won, a fine of up to 3 billion won may be imposed.

The fine will be calculated based on factors including the number of violations, the size of the company, and the number of fatalities. The final amount will be determined after review by the Fine Review Committee, taking into account the severity of the violations, the proportion of fatalities relative to the company’s total workforce, and measures taken to prevent recurrence. The fines collected will go to the Industrial Accident Compensation Insurance Fund for use in preventing industrial accidents. However, detailed procedures for imposing fines and operating the review committee will be set out in subordinate legislation, including enforcement decrees.

Workers’ right to stop work will also be expanded. Workers may stop work and evacuate not only when there is an imminent risk of an industrial accident, but also when they fear such a risk. Workers, worker representatives, and honorary industrial safety inspectors may request that their employer stop work, and subcontracted workers will also be able to request a work stoppage directly from the prime contractor.

The grounds on which the Minister of Employment and Labor may order work to stop will also be broadened. The Minister may issue a work-stoppage order not only when a serious accident occurs, but also when a worker loses consciousness in an accident or it is unclear whether the worker is alive. The Minister may also order work to stop when there is an imminent risk of a serious accident due to a collapse, fire, explosion, or leak of hazardous substances. If an employer fails to comply with an order to take corrective measures, such as installing safety railings, and an imminent risk of an industrial accident arises, work must be suspended until the corrective measures are completed.

Administrative sanctions against workplaces where fatal accidents occur repeatedly will also be strengthened. If an industrial accident, such as one in which at least two people die at the same time, occurs due to a violation of safety and health measures, and the workplace has been ordered to suspend business at least twice within three years of the Act’s effective date, the Minister of Employment and Labor may request that the relevant administrative agency revoke or cancel the business registration if the workplace again becomes subject to a request for business suspension.

A new legal basis has also been established for paying rewards to people who report violations of the Occupational Safety and Health Act and its subordinate legislation. The government plans to set out detailed criteria, including the violations eligible for reporting and the reward amounts, in subordinate legislation, and to operate a “Safe Workplace Reward Reporting Center” when the Act takes effect.

The obligation to account for industrial safety and health management expenses will be expanded beyond construction project owners to include contractors and businesses in other industries. Subcontractors will be required to prepare and retain statements detailing how the funds are used and will be prohibited from using them for other purposes. Heat waves and cold spells will be specified as grounds for extending construction periods, making it possible to request extensions to help prevent industrial accidents.

Except for some provisions, the amendments will take effect in stages starting next year. The establishment of the Safe Workplace Committee and the reward system for reports will take effect on January 28 next year. The provisions on imposing fines, expanding workers’ right to stop work, and requesting the revocation or cancellation of business registrations will take effect on April 28 next year. The expanded obligation to account for industrial safety and health management expenses will apply to the construction industry from April 28 next year and to other industries from October 28 next year. Provisions allowing construction period extensions due to heat waves and cold spells, as well as expanded exemptions from safety certification for imported machinery intended for export, will take effect on the date of promulgation, October 27.

The Ministry of Employment and Labor plans to revise subordinate legislation, including enforcement decrees, enforcement rules, and related notices, to establish detailed criteria and support the measures’ effective implementation at worksites. Minister of Employment and Labor Kim Young-hoon said that, now that the comprehensive labor safety plan had been codified into law, the Ministry would revise subordinate legislation and enforcement systems so that it would lead to meaningful changes in identifying and addressing risks before accidents occur.

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