The Ministry of Land, Infrastructure and Transport and the Ministry of Employment and Labor (MOEL) on the 31st released the results of a 50-day joint crackdown by related agencies, including local governments and public institutions, on illegal subcontracting in construction projects conducted from Aug. 11 to Sept. 30.
This intensive crackdown was carried out under an instruction from President Lee Jae-myung at the Cabinet meeting on July 29, targeting a total of 1,814 construction sites nationwide. Among them, at 95 sites (a detection rate of 5.6%), 106 companies and 262 cases of illegal subcontracting were uncovered, and measures are underway, including requests to local governments for administrative dispositions such as business suspension and referrals to police for investigation.
It also said the MOEL directly conducted labor inspections at 100 sites (369 companies), including those with a history of wage arrears and construction sites of companies with many serious accidents. As a result of the inspections, wage arrears of 990 million won (involving 1,327 workers) were uncovered at a total of 171 companies, and it was found that legal allowances that should have been paid were not paid, mainly on the grounds that the workers were day laborers.
Regarding wage arrears, the MOEL actively guided settlements, immediately clearing 550 million won (615 workers) at 79 companies, while 92 other companies (440 million won) are in the process of settlement.
The Ministry of Land, Infrastructure and Transport (MOLIT) also explained that at 65 construction companies, unlawful practices were found in which a work team leader received wages in a lump sum and distributed them to workers, or wages were paid through employment agencies, rather than paying wages directly to workers, and corrective measures were taken.
In the industrial safety field, violations of safety and health measures by a total of 70 companies were uncovered, and nine of them were criminally charged for direct safety measure violations. At 64 companies, management violations concerning worker safety and health were identified, and fines totaling about 130 million won were imposed.
Among the sites where illegal subcontracting was uncovered during the crackdown period, 16 were public works and 79 were private construction sites. Types of illegal subcontracting identified included illegal subcontracting to unregistered or unqualified entities—construction companies that did not register for construction business or did not register the construction trade (141 cases)—and illegal re-subcontracting (121 cases).
The companies caught included 27 prime contractors and 79 subcontractors; all prime contractors were general construction companies, while the subcontractors comprised five general construction companies and 74 specialized construction companies.
According to the Ministry of Land, Infrastructure and Transport (MOLIT), compared with the 2023 intensive crackdown on illegal subcontracting, the detection rate decreased (35.2%→5.6%), and while the share of detections involving prime contractors fell (62.7%→25.5%), the share involving subcontractors rose (34.7%→74.7%).
The Ministry of Land, Infrastructure and Transport (MOLIT) said that while the 2023 intensive crackdown was conducted by MOLIT alone, this crackdown was meaningful in that multiple agencies participated. However, detection rates by entities other than MOLIT (31.2%)—local governments (2.6%) and public institutions (1%)—were significantly lower. It said it will strengthen MOLIT-led crackdowns going forward and, to enhance the capacity of local governments and public institutions to crack down on and manage illegal subcontracting, it will bolster training for enforcement personnel, distribute manuals, and provide enforcement support.