Daewoo E&C, with 2 worker deaths this year, cuts safety budget by one-third over 2 years

Last Year's Safety Training Budget Only 20 Million Won... One-Third of 2018
110 Violations of Industrial Safety Law Detected at Headquarters... 450 Million Won in Fines Imposed

[Sejong=Asia Economy Reporter Moon Chaeseok] At Daewoo Construction, where worker fatal accidents have occurred repeatedly, the safety and health budget execution amount has sharply decreased to one-third over the past two years.

The Ministry of Employment and Labor announced the results of its inspection of Daewoo Construction on the 29th.

Daewoo Construction experienced 6 worker fatal accidents in 2019, 4 last year, and 2 more this year. Accordingly, the Ministry of Employment and Labor began inspections of Daewoo Construction’s headquarters and nationwide sites on April 28.

Following the inspection of Daewoo Construction’s headquarters, the Ministry identified 110 violations of the Industrial Safety and Health Act and imposed fines totaling 453.6 million KRW. The decrease in safety and health budget execution was a major issue.

According to the Ministry’s inspection results, Daewoo Construction’s safety and health budget execution amounts were 1.43 billion KRW in 2018, 970 million KRW in 2019, and 530 million KRW last year, showing a significant decrease each year. It was also found that the site safety management budget was sometimes used for operating expenses of the Quality and Safety Office, the headquarters’ safety management organization. The safety and health education budget execution also sharply declined from 300 million KRW in 2018 to 140 million KRW in 2019 and 20 million KRW last year. The Ministry pointed out that “sufficient safety and health budget allocation and a drastic increase in investment are necessary.”

The Serious Accidents Punishment Act, which will be enforced from January next year, allows for punishment of CEOs and other management officials of companies where serious accidents such as worker fatalities occur if they fail to fulfill obligations such as establishing safety and health management systems. The size of a company’s safety and health budget is a core element of the safety and health management system.

Daewoo Construction’s internal regulations were also evaluated as lacking in the CEO’s responsibility and role in safety and health management. It was noted that safety and health were neglected while financial performance was mainly emphasized. The final authority to review the results of safety and health activities was delegated to business division heads and others. Regarding this, the Ministry recommended, “Authority should not be delegated on important safety and health matters, and the CEO’s substantive opinions should be directly reflected by strengthening responsibility and roles.”

Over the past 10 years, the head of Daewoo Construction’s Quality and Safety Office was not a specialist in the safety and health field, and the average tenure was less than one year, making it difficult to maintain expertise and continuity in the work. Although the number of housing construction sites increased from 69 in 2018 to 82 last year, the number of site supervisors only increased from 893 to 917 during the same period. Some building demolition sites did not have supervisors assigned.

Daewoo Construction was also found not to have verified the adequacy of risk assessment activities of subcontractors. This indicates that a risk factor management system between primary and subcontractors was not properly established. Safety and health management at Daewoo Construction’s nationwide construction sites was also lax. Some construction sites did not even appoint separate safety managers. Numerous cases were found where safety railings and rockfall prevention facilities were not installed.

The Ministry of Employment and Labor identified 93 legal violations during inspections of 62 Daewoo Construction sites nationwide. Among these, 27 cases were subject to judicial action, and fines totaling 95 million KRW were imposed on 51 cases.

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