Personnel risks faced by companies are growing on a regular basis. Mistakes made in the workplace or risks stemming from the workplace can damage the company’s reputation/brand and cost the company a lot of money. As many companies face an increasing number of employment and/or personnel related claims, clear personnel processes are vital. Legal exposure is enormous as is damage to the company’s brand.
In the past, companies would handle personnel risk through a number of personnel controls via processes, namely processes revolving around recruitment, training, supervision and performance appraisal processes. Rules and policies were drafted and placed in the company’s policy manual or employee handbook. Many times, once the policies were embedded in the company’s manual or employee handbook they were forgotten. However, due to the ever increasing litigation and media surrounding personnel issues including bribery and fraud, as well as discrimination and sexual harassment, the implementation and enforcement of risk management processes covering personnel/employment issues has become very serious.
Anti-bribery laws have become center stage in the last few years. Not only has the DOJ expanded the enforcement of the FCPA outside of the US, but other countries, such as Korea, have implemented anti-bribery laws too. In Korea, the Kim Young Ran Act not only implements an anti-bribery law that is quite drastic, but it may now be enforced against teachers, quasi-public officials as well as companies whose employees have violated the Act. The Kim Young Ran Act ( the Act on the Prevention of Improper Solicitation and Receipt of Money and Goods) recently went into effect , and promises to not only penalize various acts of public corruption but also extends the reach of the anti-bribery laws into certain areas of the private sector. In strengthening various provisions of Korea’s current anti-bribery and corruption laws and regulations, the Kim Young Ran Act (the Act) focused on 4 areas: ( I) the expansion of the acts that may be punished; (2) the expansion of the definition of “public official” ; (3) the prohibition of improper solicitation without the payment of money; and (4) the introduction of liability provisions to ensure corporate accountability. Now, domestic companies must be concerned about employees violating the Act as well as the risk of reputational damage.
To learn more about managing personnel risks in Korea, please attend the KBLA seminar on November 19 entitled “Managing People Risks”. For more information on the seminar I refer you to the following link: