Korea Rail Network Authority Initiates Development of Next-Generation System to Prevent Construction Payment and Wage Arrears

A panoramic photo of the Korea Rail Network Authority building (right) and Korea Railroad Corporation building (left) located in Dong-gu, Daejeon. Provided by Korea Rail Network Authority.

[Asia Economy (Daejeon) Reporter Jeong Il-woong] Korea Rail Network Authority announced on the 28th that it has begun developing a ‘next-generation wage arrears prevention system’ to fundamentally block construction payment and wage arrears.

The next-generation wage arrears prevention system is being developed with the core function of establishing a separate bank account by the Rail Network Authority to directly pay wages and construction payments to workers and subcontractors even in the event of bankruptcy of the primary contractor, thereby preventing arrears in advance.

It will also include features that allow the client to monitor cash flow in real time, such as prohibiting verbal contracts between construction companies and workers, mandating electronic contract signing, and ensuring advance payments and proper wage payments.

The Rail Network Authority plans to complete development of the next-generation wage arrears prevention system and conduct pilot operations by the end of this year to prepare for its application on site.

Kim Sang-gyun, Director of the Rail Network Authority, said, “We hope that the development and introduction of the next-generation wage arrears prevention system will serve as a turning point to fundamentally block the construction payment and wage arrears that have been secretly occurring at railway construction sites,” adding, “Along with this, the Rail Network Authority will strive to create quality jobs in the public construction sector going forward.”

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