The Fair Trade Commission imposed a corrective order on Dong-A Construction Industry for violating the Fair Transactions in Subcontracting Act after it awarded the telecommunications equipment work for the Icheon Jinam District urban development project. The commission says Dong-A Construction Industry ordered additional work that was not in the design without a written contract and pushed ahead with work through a pre-input method, infringing the subcontractor's rights and interests.
On the 18th, the commission said Dong-A Construction Industry violated the "obligation to provide a written document before starting work" stipulated in Article 3 of the Fair Transactions in Subcontracting Act. The act of directing work without preparing a contract specifying the subcontract price and construction conditions was flagged as a problem.
According to the commission's investigation, from 2022 to 2023, Dong-A Construction Industry had additional and change orders in the Icheon Jinam District telecommunications equipment work carried out by sending only emails or drawings. Several tasks, including electric-vehicle charging facility communication lines, CCTV wiring, and household bathroom phone installation, proceeded with only emails and drawings provided. Change contracts specifying the construction price and conditions were not issued before the work.
Even before the main contract, Dong-A Construction Industry assigned work to the subcontractor using a pre-input method. In late 2021, citing construction delays, the parties decided to proceed with some tasks first and prepared only a handover document. The document listed only the site name, period, and scope of work, omitting essential items such as the subcontract price, responsibilities, and contract terms.
The commission believes this approach created an unfavorable contracting environment for the subcontractor. It emphasized that additional work must also be clearly defined through a separate contract that specifies the scope and price.
The commission said, "The repeated practice in construction sites of no-contract additional work and pre-input infringes on subcontractors' rights and interests," and added, "It is significant in that it makes clear that the prime contractor must comply with the contract procedures set by law."