Appeal from SMEs Industry: "Overlegislation Concerns, Stop Enacting the Serious Accident Corporate Punishment Act"

Press Release of Small and Medium Enterprises on the Enactment of the Serious Accidents Punishment Act

[Asia Economy Reporter Kim Cheol-hyun] The small and medium-sized enterprises (SME) sector has issued an appeal requesting the suspension of the enactment of the Serious Accidents Punishment Act, which raises concerns about excessive legislation. They argue that adding the Serious Accidents Act to the current Industrial Safety and Health Act would make compliance impossible given the poor conditions of SMEs.

On the 15th, 13 SME organizations, including the Korea Federation of SMEs, released the 'Appeal from the SME Sector Regarding the Enactment of the Serious Accidents Punishment Act.' Participating organizations include the Korea Federation of SMEs, the Korea Specialty Contractors Association, the Korea Mechanical Equipment Construction Association, the Korea Women Entrepreneurs Association, the Korea Federation of Micro Enterprise Associations, the Korea Venture Capital Association, the Korea Venture Business Association, the Korea Federation of SMEs Convergence, the Korea Women Venture Association, the Korea Franchise Industry Association, the KOSDAQ Association, the INNOBIZ Association, and the Korea Management Innovation SME Association.

The industry stated, "The currently discussed Serious Accidents Punishment Act places all responsibility for industrial accident occurrences on the business owner and stipulates quadruple punishments including criminal penalties for representatives, corporate fines, administrative sanctions, and punitive damages." They added, "We hope the enactment of the Serious Accidents Punishment Act, which raises concerns about excessive legislation, will be halted so that 6.63 million SMEs can overcome the COVID-19 crisis and focus on job creation."

Furthermore, the industry pointed out, "Under the currently enforced Industrial Safety and Health Act, representatives can already be sentenced to imprisonment of up to seven years. However, the proposed bills impose imprisonment terms of two, three, or five years or more on representatives." They argued, "This is harsher than the United States and Japan, where the maximum imprisonment is six months. Especially compared to the UK Corporate Manslaughter and Corporate Homicide Act, which is the model for the Serious Accidents Act and imposes corporate fines rather than business owner penalties, this is excessively severe."

The appeal also stated, "Currently, the Industrial Safety and Health Act includes 1,222 mandatory provisions that business owners must comply with, covering all obligations related to industrial safety and health. Adding the Serious Accidents Act would make compliance impossible given the poor conditions of SMEs." The industry particularly emphasized the representative punishment clause, saying, "Unlike large corporations, 99% of SME owners are also the representatives. When an accident occurs, the SME representative must manage the incident and handle the aftermath. Please allow representatives to continue their management activities in a way that fits the reality of SMEs."

Through the appeal, the SME sector also stressed, "Punishing companies is not the solution. Industrial accident policies should focus on guidance and prevention, considering the SME workplace environment." They concluded, "The SME sector will also do its best to create safe workplaces."

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