Geonsanyeon "Serious Accident Corporate Punishment Act Differs from UK... Careful Enactment and Application Needed"

"UK Sees No Significant Drop in Accident Death Rate per 100,000 After Corporate Manslaughter Law Introduction"
UK Focuses on Appropriateness of Organizational Management and Methods in Major Accidents
"Expanding Punishment Is Not the Answer... All Participants Must Faithfully Fulfill Responsibilities and Roles"

[Asia Economy Reporter Yuri Kim] Regarding the enactment of the 'Serious Accident Corporate Punishment Act (draft)', there have been calls to carefully consider the introduction of the bill in light of domestic environmental and construction industry characteristics.

The Korea Construction Industry Research Institute revealed this through a report titled 'Comparative Analysis of the Domestic Serious Accident Corporate Punishment Act (draft) and the UK's Corporate Manslaughter and Corporate Homicide Act' on the 8th. The institute stated, "The Serious Accident Corporate Punishment Act (draft) can be evaluated as part of efforts to create a safe society and protect workers' lives and health," but also argued, "Since the characteristics and environments differ by industry and various systems and laws to prevent safety accidents are already in operation in the construction industry, the enactment and application of the bill should be approached with caution."

The core of the Serious Accident Corporate Punishment Act (draft) is to impose strong penalties, including criminal liability on corporations and management officials, depending on corporate negligence, to reduce serious accidents such as fatal accidents. According to the bill, management officials may face imprisonment for more than three years or a fine ranging from 50 million KRW to 1 billion KRW in the event of a fatal accident, and corporations may be subject to fines ranging from 100 million KRW to 2 billion KRW, or aggravated fines up to one-tenth of sales, business suspension, and other sanctions. Additionally, punitive damages are also possible.

This bill benchmarks the UK's Corporate Manslaughter and Corporate Homicide Act enacted in 2007 and is similar in terms of preventing industrial disasters and raising corporate safety culture awareness. However, the Korea Construction Industry Research Institute analyzed that there are clear differences in the obligated subjects, presence of gross negligence, subcontracting obligations, and damages compensation. Under the UK's Corporate Manslaughter and Corporate Homicide Act, the key requirement for establishing a crime is not whether individual executives or practitioners violated their duty of care in fatal accidents, but whether the management and organizational methods of the organization are appropriate. Article 18 of the Corporate Manslaughter Act explicitly states that responsibility for the victim's death does not apply to members of the organization.

It was also analyzed that there is little effect on the reduction rate of fatal accident numbers. Since the UK's Corporate Manslaughter Act was enacted in 2008, there have been a total of 25 punishment cases until 2017. After the introduction of the Corporate Manslaughter Act, the fatal accident rate per 100,000 workers in the UK construction industry decreased from 2.04 in 2008 to 1.60 in 2017, an average annual decrease of 3.3%, which is not significantly different from the 2.6% average annual decrease from 1998 to 2007 before the law was enacted.

Researcher Tae-Hong Son of the Korea Construction Industry Research Institute emphasized, "In the construction industry, legal penalties and economic sanctions have been further strengthened recently due to measures such as fire safety countermeasures at construction sites, and the level of obligation to prevent fatal accidents resulting from serious accidents is continuously increasing," adding, "While additional systems and laws are necessary, corporate investment in advanced safety management and compliance with safety rules by on-site personnel must accompany these efforts to establish a foundation for a safe construction industry."

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