Problems with subcontracting system are related to the poor working conditions and job instability of the workers employed by the subcontractors of smallandmedium-sized enterprises. It is based on the low bidding price in the multistage subcontracting system and the shirking responsibility as an employer of subcontractor.
Head contractors ordinarily influence the level of wage of workers in the subcontracting system. Subcontractors can decide and pay the wage of workers in the bidding price of production. In fact, the subcontractor has no power to enhace the wokers' wage and working conditions.
This article describes the legal issues which arise in the subcontracting system on a large enterprise and a smallandmedium-sized enterprises, in the legal charscteristics between head contractors and principal subcontractors, principal subcontractors and workers. Especially, since the trade relation contractors and principal subcontractors is ruled by economic law,i.e., Fair Trade Law on subcontracting, etc. the paper considers the implication for the amendment these laws as well.