Although the relationship between the principal contractor and subcontractor is contractual in nature, it is generally observable that the status of the subcontractor is protected from undue influence by the principal contractor within the framework of special provisions for the status of subcontractors in the Fair Transaction in Subcontracting Act. For example, principal contractors are obligated to issue and submit written documents to the subcontractors and they cannot compel the subcontractors to reduce the subcontract consideration established at the time of the initiation of manufacturing, etc. Moreover, under this Act, it is possible for subcontractors to request that the original client or developer pay the subcontract consideration where payment has been suspended, the principal contractor is bankrupt, or similar circumstances arise. At the same time, under the Labor Standards Act, in cases where the subcontract agreement is made, an immediate upper-tier contractor shall directly pay the workers employed by a subcontractor an amount of money equivalent to the wages which the subcontractor shall pay at the request of workers employed by such subcontractors.
Unlike the case of the relationship between the contractor and subcontractor bound by a direct contractual relationship, the relationship between the client (or owner, or developer) and subcontractor is distinct in that it is constituted by law without mutual consent of the parties concerned. Thus an important question is how should these special provisions for the protection of subcontractors be understood? In other words, are these exceptional provisions for subcontractors a way to protect the weak from the strong (principal contractors), or are they the natural, logical results originating from the inherent rights of subcontractors?
Given that subcontractors have provided diverse services and efforts for the completion of the ‘Work’ and that the ultimate beneficiary of the ‘Work’ is the client (or developer), these special provisions for protecting subcontractors should be understood as the materialization of the inherent and essential rights of subcontractors. In other words, these special provisions should be understood as legislative efforts for the materialization and concretization of the inherent and essential rights of the subcontractors, rather than as the special protection of the weak from the strong. These aspects of the nature of the special provisions on the status of subcontracts should also be taken into account when the relevant statutory laws are to be modified or revised in the future.