The construction industry sharply criticized the use of safety management measures by prime contractors for subcontractors as grounds to recognize employer status under the "Trade Union and Labor Relations Adjustment Act amendment" ("the yellow envelope law, a new labor law aimed at strengthening the bargaining rights of subcontract workers"), calling it "a contradiction that penalizes law-abiding corporations." The yellow envelope law, a new labor law aimed at strengthening the bargaining rights of subcontract workers, allows subcontract workers (unions) to demand bargaining with the prime contractor if the prime contractor has employer status, meaning "a position with the practical and specific power to control and decide" on the subcontractor's working conditions. It took effect on Mar. 10 and the question of employer status is being contested at regional labor commissions and the Central Labor Commission.
What worries the construction industry is that some labor commissions are using the prime construction corporations' safety management under the Occupational Safety and Health Act and the Serious Accidents Punishment Act as grounds to recognize employer status.
The Construction Association of Korea said, "We express deep concern that labor commissions recently have been using prime contractors' safety management measures as grounds to recognize employer status," and argued, "Prime contractors' safety management is nothing more than an unavoidable legal duty under the Occupational Safety and Health Act and the Serious Accidents Punishment Act, and it is by no means an exercise of control or decision-making authority over working conditions."
It also noted, "The Ministry of Employment and Labor (MOEL) clarified in a press explanation on Apr. 13 that merely fulfilling the obligations as a client under the Occupational Safety and Health Act does not make one an employer under the Trade Union and Labor Relations Adjustment Act," and pointed out, "Even so, most regional labor commissions are using prime contractors' safety obligations as grounds to recognize employer status, and even the Jeonnam Regional Labor Commission's ruling—the only one to hold that safety obligations alone cannot establish employer status—was recently overturned by a completely different decision from the Central Labor Commission."
The association said, "Making compliance with safety obligations for legal compliance the core basis for determining employer status is a logical contradiction that disadvantages law-abiding corporations." It also asked the government and the National Assembly to actively improve the system, including by amending laws, so that merely carrying out safety obligations under the Occupational Safety and Health Act and the Serious Accidents Punishment Act does not lead to being deemed an employer. It urged labor commissions as well to establish employer-status criteria that reflect the characteristics of construction sites.