"70% of Budgets Increased for Serious Accident Prevention Law... 1 in 4 Places Doubled or More"

On January 27, the first day of the Serious Accidents Punishment Act, which allows for the punishment of management officials when serious accidents such as worker fatalities occur, a construction site of an apartment in Gyeonggi-do./Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Choi Dae-yeol] According to the Korea Employers Federation (KEF) on the 19th, more than 70% of companies surveyed increased their safety-related budgets in line with the enforcement of the Serious Accidents Punishment Act.

According to a survey conducted by KEF targeting 367 domestic companies with 50 or more regular employees, 69% responded that management's interest in safety significantly increased after the enactment of the Serious Accidents Punishment Act in January last year. Regarding budget changes compared to before the law was enacted, about 71% said their budgets increased. Among large companies with over 1,000 employees, 84% reported budget increases; 78.3% of mid-sized companies with 300 to 999 employees; and 67% of small companies with 50 to 299 employees said their budgets increased. KEF explained, "The Serious Accidents Punishment Act requires additional personnel and budget to comply, leading to increased safety investments by companies regardless of their size."

Looking at the details, 24.8% of companies more than doubled their budgets (100% or more). This is about one in four companies that increased their budgets. Additionally, 52% said their budgets increased by about 25% to 100%, accounting for more than half. Regarding the areas where the increased budgets were invested, 45.9% responded that it was for ‘improvements, repairs of hazardous facilities and equipment, and expanded purchase of protective gear,’ and 40.5% said it was for ‘establishing dedicated safety and health organizations and expanding personnel.’ The biggest reason for no budget change was financial constraints due to COVID-19 and other factors, cited by 44%, nearly half.

Compared to before the law was enacted, 42% said their workforce increased. The average increase in personnel was 2.8 people, with large companies showing relatively larger increases by size. Companies responded that labor costs have increased and that there are not enough qualified safety personnel on site as needed.

KEF emphasized, "To resolve the difficulties in personnel management faced by mid-sized and small companies, support measures such as smooth supply of qualified safety personnel and cost support for hiring are necessary. Since the law will be fully applied to companies with fewer than 50 employees starting January of the year after next, the government must actively present support measures to establish safety and health management systems in small workplaces."

Regarding amendments to the law, 8 out of 10 companies saw them as necessary. The most common reason was that ambiguity and lack of clarity are increasing confusion on the ground. As for the content of the amendments, 94% said it is necessary to specify the obligations and scope of responsibility of management.

Thirty-six percent said the law should be amended immediately, another 36% said within a year, and 32% also answered immediate amendment was needed. KEF Vice Chairman Lee Dong-geun said, "With the social atmosphere around ESG (Environmental, Social, and Governance) management and the enactment of the Serious Accidents Punishment Act, management's awareness of safety has been raised, and many companies have increased safety investments, showing that managers are making great efforts to prevent serious accidents."

He added, "To effectively reduce serious accidents, it is necessary to quickly shift the industrial safety policy framework to a prevention-centered approach, as seen in advanced countries."

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