Subcontracting Upon Subcontracting... Companies Engaged in 'Outsourcing of Death' Caught

40 Company Representatives and Others

A company that illegally subcontracted safety inspection services for major facilities such as bridges and tunnels commissioned by local governments and public institutions nationwide has been caught by the police.

The Metropolitan Investigation Unit of the Seoul Metropolitan Police Agency announced on the 19th that it has arrested 40 people, including the representatives of service companies, on charges of violating the Facility Safety Act and the Construction Technology Promotion Act. The photo shows items seized by the police during the search. Photo by Seoul Metropolitan Police Agency

The Metropolitan Investigation Unit of the Seoul Metropolitan Police Agency announced on the 19th that it has arrested 40 people, including the representatives of service companies, on charges of violating the Facility Safety Act and the Construction Technology Promotion Act, and has referred them without detention.

According to the police, from May 2023 to March this year, these individuals are accused of illegally subcontracting safety inspection and design services for facilities commissioned by local governments and public institutions, or of performing such services without being registered as safety inspection agencies. A total of 26 service companies were found to have illegally subcontracted a total of 115 service contracts.

The Facility Safety Act, which was established in response to the collapse of the Seongsu Bridge in 1994, prohibits subcontracting to prevent poor-quality inspections and stipulates that only registered companies with a certain number of personnel and equipment can conduct safety checks.

The police investigation revealed that some large-scale safety inspection companies, having effectively monopolized service contracts, found it difficult to carry out all the work with their own personnel. As a result, they illegally subcontracted the work at low prices to companies with fewer track records, and those subcontracted companies in turn re-subcontracted the work to unregistered firms to perform the services.

It was found that the contracting companies evaded crackdowns by temporarily registering subcontractor employees as their own staff or by issuing fake tax invoices unrelated to the services.

Starting from December 4, under the revised Facility Safety Act, penalties will be significantly strengthened for those responsible at companies that violate obligations related to facility safety management, such as safety inspections and detailed safety diagnoses.

The amendment stipulates that if a safety inspection is performed poorly, offenders can face up to two years in prison or a fine of up to 20 million won. If inspection results are falsified or reports omit earthquake investigations and similar requirements, offenders can face up to three years in prison or a fine of up to 30 million won.

A police official emphasized, "If illegal subcontracting continues, it can lead to poor safety management and pose a serious threat to public safety," adding, "We urge those involved in safety companies to perform their services responsibly and call on the authorities to maintain thorough oversight and supervision."

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