"World's Toughest Punishment Bill"... Business Community's All-Out Effort to Block Serious Accident Act

[Asia Economy Reporter Su-yeon Woo] As the National Assembly pushes for the enactment of the "Serious Accident Corporate Punishment Act," which punishes companies when accidents occur in industrial sites, the business community has strongly opposed it, arguing that new regulations are being added on top of the current laws that already impose some of the world's toughest penalties on companies.

On the 16th, 30 economic organizations and industry associations, including the Korea Employers Federation, the Korea Chamber of Commerce and Industry, the Federation of Korean Industries, and the Korea Federation of Small and Medium Business, issued a statement opposing the enactment of the Serious Accident Act and urged a halt to the legislative push. The business community pointed out that since the current Industrial Safety and Health Act already imposes the world's highest level of penalties on business owners, increasing the severity of punishments further would not be effective in reducing accidents.

Kwon Tae-shin, Executive Vice Chairman of the Federation of Korean Industries, said, "They are trying to create the Serious Accident Act again even before reviewing the effects or side effects of the Industrial Safety and Health Act, which has the strongest penalties in the world and was implemented this January." He criticized, "With a series of regulations tightening control over companies recently passing in bulk, companies are focusing more on labor-management relations and accident prevention rather than bold investments, or they will eventually move overseas."

Furthermore, the business community pointed out that the current Industrial Safety and Health Act’s safety and health regulations are complex and extensive, lacking clarity in terms of regulatory quality, and should be improved in that direction. Currently, the Industrial Safety and Health Act contains 1,222 provisions related to employer obligations, and the related rules amount to 673 provisions.

Moreover, aside from fines imposed on companies, there are four layers of regulations including personal penalties for business owners, administrative sanctions such as business suspension and work stoppage, and punitive damages. Despite these already being among the world’s toughest penalties, the fatal accident rate per 10,000 workers is 2 to 3 times higher compared to advanced countries like the United States, Germany, and Japan.

Looking at the punishment standards for violations of safety and health measures under industrial safety and health laws in various countries, South Korea allows the highest imprisonment sentence of up to 7 years or fines up to 100 million KRW. Next, the UK and Singapore set standards allowing imprisonment of up to 2 years, while most other countries impose imprisonment of less than 1 year.

According to the Korea Employers Federation, the current penalty level for fatal industrial accidents under South Korea’s Industrial Safety and Health Act is already the highest in the world (up to 7 years imprisonment or fines up to 100 million KRW for individual business owners, corporate fines up to 1 billion KRW, with penalties increased by 50% in case of death). However, as of last year, the number of fatal industrial accidents per 10,000 workers was 46, significantly higher than major countries (United States 37, Japan 16, Germany 15, UK 4).

Kim Yong-geun, Executive Vice Chairman of the Korea Employers Federation, also suggested, "To effectively increase the reduction of fatal accidents, industrial accident prevention policies, which are currently insufficient compared to other countries, must be significantly strengthened." He proposed, "The focus of South Korea’s industrial safety policy should shift from the current post-accident punishment approach to a preemptive prevention policy."

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