Korean businesses seek more time on industrial accident law

Korea's business community is calling for an extended grace period for the implementation of industrial accident laws on small businesses with fewer than 50 employees, citing a lack of readiness.

Lee Dong-geun, vice chairman of Federation of Korean Industries, fourth from left, reads out a joint statement issued by Korea's five business associations, that urges the National Assembly to pass the revised bill that extends the grace period of the Serious Accident Punishment Act by two additional years in Yeouido, western Seoul on Tuesday. [FEDERATION OF KOREA INDUSTRIES]

Korea's business community is calling for an extended grace period for the implementation of industrial accident laws on small businesses with fewer than 50 employees, citing a lack of readiness.

The Serious Accident Punishment Act, which was enacted for bigger businesses in 2022, aims at punishing employers in case of fatal on-site accidents due to a lack of safety measures.

Employers can face a minimum of a one-year prison term or a fine of up to one billion won ($750,000). It is slated for fully-fledged enactment from Jan. 27 unless a revised bill that extends the grace period gets passed at the National Assembly.

"There is no doubt that employees' safety is important but it is also a reality that small- and medium-sized businesses aren't prepared yet due to unfavorable conditions," said Finance Minister Choi Sang-mok on Tuesday.

"The revised law reflects concerns from the site that [the implementation of the act] will lead to lawbreakers that will shake the survivorship of the companies instead of preventing disasters."

Representatives of businesses and the ruling People Power Party (PPP) have been calling for the passing of the revised bill at the National Assembly while the opposition Democratic Party of Korea (DPK) has been refusing to do so.

Some 14 associations representing small- and medium-sized enterprises (SME), including the Korea Federation of SMEs, convened Tuesday to issue a statement urging the DPK to pass the revised bill on extending the grace period. Five business associations, including the Federation of Korean Industries (FKI) and Korea Chamber of Commerce and Industry (KCCI), also issued a joint statement, expressing concerns about possible side effects.

"We have asked for the grace period extension multiple times considering the chronic manpower shortage and financial difficulties at more than 83,000 businesses in Korea that have less than 50 employees," read the joint statement issued by the five business associations on Tuesday.

"If the act that strongly punishes the business owner gets implemented, concerns over business shutdowns and employee layoffs will become a reality. We sincerely request the National Assembly to pass the revised bill on extending the grace period and not look away from the desperate reality of businesses with less than 50 employees."

The five business associations promised that they would not ask for an additional grace period after the two-year extension and will educate and consult SMEs to improve their workplace safety regulations and awareness.

Labor unions are fiercely opposed to the request.

"This act has already undergone a three-year grace period and labor workers at businesses with less than 50 employees have been dying out," said Yang Kyung-soo, head of the Korean Confederation of Trade Unions at a news conference held Tuesday. "It is not understandable that a law cannot be implemented because people are not ready to abide by the law."

The revised bill is to be addressed at the parliament on Thursday.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]