“We won’t eat bread stained with the workers’ blood.” This is the phrase of a sign that a participant in a memorial ceremony for the worker in the death case of the SPL bread factory held up in front of the SPC Group’s headquarters. In October, an SPL worker who was dealing with an industrial mixer for bread sauce lost her life due to a sudden accident. SPC Group selfishly reacted to the accident by thinking of their own interests first, not the victims, even though a human’s life is the most precious thing which is irreplaceable. Then, what is a company the SPC Group, how did they react to the accident, and how the public responded to it? Let’s look into the case with CAH.

SPC Group and Its Influence over Korea

SPC Group made a big splash by establishing an epoch-making franchise business in Korea by founding Paris Croissant in 1945. SPC Group has a very strong influence in Korea. According to the Korea Fair Trade Commission, SPC Group had more than 6,000 franchisees of its brands as of the end of 2020, and it has 68 subsidiaries including Samlip, Paris Croissant, and SPL as of last June. Also, according to the Korea Argo-Fisheries & Food Trade Corporation in October, the share of SPC Group’s 5 subsidiaries accounts for 83.4% in the bread manufacturing business market. With the specific figures, its 5 subsidiaries’ sales are 3.765.812 trillion won[1] while the total sales of 82 bread manufacturers as of last year were 4.517.293 trillion won. It is difficult to enter the baking industry since the industry especially requires investment in large-scale facilities, high technologies, and physical distribution & circulation systems. In addition, maintenance costs can be quite high. For these reasons, SPC Group is a monopolist and oligopolist company in Korea, so the SPC Group can raise their prices across the board. In fact, Paris Baguette increased 95 sorts of bread's prices by 5.6% last February, and it marked 66 types of bread’s prices by 6.7% this February when the last price advance enforcement did not go through. So, the Korean National Council of Consumer Organizations pointed this out and said, “Paris Baguette seems to raise the prices each time when causes for a price advance like raw materials happens, not considering the consumers and market forces as the largest market share company in the Korean baking market.”

However, not related to this success, the SPC Group is encountering lots of criticism about industrial accidents. According to the data from the Korea Occupational Safety & Health Agency (KOSHA) that Lee Eun-ju, a member of the National Assembly from the Justice Party (Lee) received in October, the number of people “suffered an industrial accident at SPC Group’s subsidiaries such as PB Partners, SPL, BR Korea, and Paris Croissant,” were 4 in 2017, 76 in 2018, 114 in 2019, 125 in 2020, 147 in 2021, and 115 by September 2022. The sorts of accidents include such things as falling, being caught in industrial machinery, amputation, cuts, stabs, burns, and more. The number of industrial accident victims is increasing each year, and it seems likely 2022 will yet again set a new record. With this situation, Lee said “In the latest death case of industrial disaster, we can avoid it with prevention activities like checking safety facilities. So, the SPC Group should be cautious about increasing industrial disasters and fulfill its responsibility.” However, KOSHA certificated the KOSHA-Management System for SPL where a worker died, with its occupational safety and health management system, not examining whether it installed interlocks or not, though there are 37 victims injured from being caught there from 2017 to September 2022. In addition, SPL has been exempted from regular labor supervision of the Ministry of Employment and Labor (MOEL) for 3 years by being chosen as the Company with the Best Jobs in Korea in 2022 by the government.

SPC Group’s Human Rights Violation: Industrial Accident of Workers

A Death Case in the SPL Bread Factory

On October 15^th around dawn, a worker in her 20s lost her life by getting caught in an industrial mixer for sandwich sauce at the SPL bread factory in Pyeongtaek, Gyeonggi. It seems that she died when her apron was sucked into the machine during the operation. It, unfortunately, happened when her colleague left for a moment, where the operation normally works with two people in a team. The family of the deceased filed a complaint against Heo Young-in (Heo), the chairman of the SPC Group for violating the “Serious Accidents Punishment Act” to the police and the MOEL, asking them to reveal the details of the accident. Oh Bin-nara (Oh), the legal representative of the family said that Heo is the chief executive officer of the Serious Accidents Punishment Act. Oh also argued that SPC Group attributed the accidents of the deceased by exploiting the lack of evidence due to the absence of surveillance cameras. Moreover, she said that the SPC Group did not admit the absence of safety measures. So, the MOEL started investigating Kang Dong-seok, the SPL CEO for violating the Serious Accidents Punishment Act[2] and the Occupational Safety And Health Act. In addition, the MOEL has carried out constant labor supervision and occupational safety and health supervision against the nationwide SPC Group’s subsidiaries since October 24^th. However, Nam Gu-jun, the chief of the National Investigation Headquarters from the Korean National Police Agency obscurely opined about inspections of Heo by saying “It is hard to announce specific plans and subjects of investigations,” at a press conference.

A Finger Amputation Accident in the Shany Factory

On October 23^rd, 6 a.m., only a few days after the death case, a worker in his 40s lost his finger in the machine carrying the bread boxes at the Shany bread-making factory in Seongnam, Gyeonggi. His finger was trapped in the machine when he tried to sort defective products out from the conveyer belt. Fortunately, his colleague immediately shut down the machine after hearing his scream, and he got the operation to reconnect his finger. SPC Group faced criticism for its cursory apology and promise since the accident happened only two days after Heo apologized and promised to reinforce the safety system of SPC Group’s fields. Seongnam Jungwon Police Station which took charge of the investigation for the case has examined relevant parties including safety managers in the fields for professional negligence resulting in death, and checking whether they observed the safety precautions or not in the situation.

Boycott against SPC Group and Its Impact

According to Yonhap News Agency in November, the sales of Pokemon bread decreased due to the boycott against SPC Group’s products after the death case. The sales of Pokemon bread in supermarkets from October 15^th to 31^st decreased by approximately 10% compared to the time from September 28^th to October 14^th, before the accident. On the other hand, sales of the bakery products of each supermarket’s individual brand increased by 5%. Also, sales of Paris Baguette’s franchises diminish by about 30% for the week as of October 25^th compared to the same period last year. Kim, who is running a Paris Baguette in Chuncheon said, “I have losses of hundreds of thousands of won after the boycott, and I have nothing leaving out personnel expenses as the sales decrease by 40%.” A relevant party from the Korean Confederation of Trade Unions (KCTU) Kang-Won Religion Council said that the object of condemnation should be the SPC Group headquarters, not the owners of franchises. Paris Baguette then expanded the range of bread that did not sell during the expiration date for returning to headquarters from 12 (since October 21^st) to 35 types to prevent damage toward the owners of franchises since October 28^th. Moreover, SPC Group opined that it would consider the enlargement of support for other franchises like Dunkin’ Donuts, Baskin-Robbins, etc. All of these are the results of the boycott, and many consumers are sharing how to separate SPC Group’s products as well as list their subsidiaries to boycott them as well. Also, some of them post their willingness to boycott their social networks or conduct one-man protests in front of the franchises. Along with them, other corporations try to actively participate in the boycott. For example, Hyundai Motors Ulsan Plant announced that it would replace the snack suppliers to Lotte Confectionery on October 31^st.

Besides SPC Group, other businesses are affected by the boycott. According to the Korea Economic Daily in October, a relevant agent of a corporation said that circumstances are complex due to the concerns about the burden from contract violation or breaking the favorable relationship they’ve maintained until now. So, it is not easy to cut the relationship with the SPC Group, although there is some atmosphere from the fields with the KCTU to require the discontinuation of the contract between the SPC Group and the labor union. Also, some businesses try to refrain from promoting or selling collaboration products with the SPC Group through the existing contracts. They are proceeding with the collaboration with the SPC Group of the attitude toward it which gave them help before, but it is not a simple situation considering the consumers’ views.

Reactions of SPC Group to the Accident

According to inews24 in October, the SPC Group made other employees continue working immediately after the accident, only veiling the scene with white fabric. At first, the MOEL recommended stopping 7 of 9 industrial sauce machines that do have the cover but no interlock on them. So, SPL activated the remaining 2 machines. Hankyoreh criticized how SPL would deal with workers’ trauma, reporting that SPL made other workers make bread constantly even though blood was left as the National Forensic Service’s identification was not yet done. Finally, the MOEL recommended suspending all operations on the 3rd floor of the factory including the remaining machines on the afternoon of the day when Hankyoreh reported. Meanwhile, the SPC Group was suspected to control the press related to the death case by widely promoting their newly opened Paris Baguette in London on October 16th. Moreover, according to SBS on October 18^th, the SPC Group requested SBS[3] to replace the name of SPC with “a factory in Pyeongtaek” even in the article’s title during the covering. In this way, SPC Group showed selfish aspects to connive those cases, rather than admitting its faults.

The public’s opinion became extremely negative as the SPC Group ordered the employees who saw the accident back to work and sent two boxes of bread to the deceased’s funeral. Then, Heo tried to control the situation by apologizing publicly on October 21^st. He also promised to invest 100 billion won for the next 3 years for preventing the accident recurrence, and mentioned “reinforcement of manpower for safety supervision, safety inspection in a company-wide, working environment improvement.” However, the employees’ reactions were not quite positive. Moon Byeong-ho, an organizer of the Paris Baguette Workers’ Cheer Up Joint Action, pointed out some missing parts like “absence of written apology, absence of an official expressing regret for workers, and non-accepting for the requirement of lowering working speed before establishing the prevention about similar machines with the machines of the accident.” Even though the SPC Group decreased the total working time a little bit, and increased the break time by 10 minutes for the night, it does not seem the changes via the apology since these changes were influenced by the reduced orders due to the boycott.

As mentioned before, SPL had an exemption from regular labor supervision. Lee, the member of the National Assembly, criticized it by saying, “The recent tragedy would not occur if KOSHA appropriately inspected during their 2nd certification.” Also, on YTN’s radio in October, an expert pointed out that we should recheck the Serious Accidents Punishment Act to solve the current structural problems and the press must report about structural limits related to this death case and prioritize alternatives being made. Even if the SPC Group did not show the proper reactions to these cases, CAH hopes the SPC Group to put aside corporate profit and ensure that workers’ safety and interests are a priority.