Korean Supreme Court: “If HR & Finances Are Integrated, It’s One Company”
🔹Key Ruling
The Korean Supreme Court ruled that:
For the Serious Accidents Punishment Act (SAPA),
Employee numbers must be calculated by combining headquarters and all business sites if they operate as a single entity.
The Court upheld a 3-year prison sentence for a company CEO.
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Background
In March 2022, a worker died after an explosion inside industrial equipment at a plastic manufacturing plant in Seocheon.
The CEO was charged with:
Failing to establish safety and health policies
Failing to allocate and manage safety budgets
Failing to implement preventive measures
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Key Legal Issue
Whether the workplace met the 50-employee threshold required for the Serious Accidents Punishment Act.
The defense argued:
The specific factory where the accident occurred had fewer than 50 employees,
Therefore, the law should not apply.
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Lower Court Decisions
Trial Court (1st instance):
Found the CEO guilty.
Sentenced him to 1 year in prison, suspended for 2 years.
Considered:
Compensation paid to the victim’s family
Family’s request for leniency
Appellate Court:
Increased the sentence to 3 years in prison (no suspension).
Emphasized:
Workplace safety is a systemic responsibility, not just individual fault.
The CEO failed to fulfill legal safety obligations.
Victim family’s wishes do not override public interest in punishment.
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Supreme Court Decision
The Supreme Court dismissed the appeal and finalized the 3-year prison sentence.
Key Reasoning
A “business or workplace” under the law includes:
Economically and operationally integrated units.
In this case:
Headquarters and multiple factories had integrated HR and financial systems.
Therefore:
They must be treated as one entity, and
Employee numbers must be aggregated when applying the law.
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Legal Significance
Establishes a clear rule:
Companies cannot avoid SAPA liability by splitting operations into smaller units.
Expands accountability for:
Corporate executives and management-level decision-makers.
Reinforces that:
Workplace safety failures are structural and managerial, not isolated incidents.
Article: https://www.lawtimes.co.kr/news/articleView.html?idxno=217841
