Workers under non-lifelong employment systems (or life-long employment systems which are about to be revised) feel more stress than workers at firms which are maintaining their systems. This was the finding of a survey recently conducted by the Ministry of Labour.
The questionnaire survey was sent to 2,610 white-collar employees at 522 firms with 1,000 or more regular employees that had previously answered another survey concerning business and personnel management strategies. Valid answers were returned by 1,127 individuals. Among the male respondents, 55.0 percent of those working at firms which had answered in a survey the previous year that they planned to maintain the life-long employment system answered that they had experienced mental stress. The corresponding figure for employees at firms planning to reconsider their life-long employment system was 62.6 percent, and for employees at firms without such an employment system the figure was 72.7 percent. At the same time, only 52.4 percent of workers at firms which planned to adopt a reemployment or employment extension system stated that they were stressed, as against 61.3 percent at firms which did not have such plans. In addition, among workers whose goals were all set by their superiors and those who were not satisfied with the objectives they were given, 72.0 percent and 81.3 percent respectively felt they were stressed. It was also found that 71.1 percent of those who were not allowed to raise objections to their superiors' evaluation of them were under stress. The survey has revealed that the nature of the personnel management system as a whole, including employment patterns and evaluation systems, has a strong relationship with mental stress among workers.
The survey points out that the deterioration of the business environment has resulted in a large number of workers feeling anxious about loosing their jobs; about changes in personnel management systems, about salaries, about their workplace, and about their future in general. It warns that mental stress among workers due to personnel management practices has grown, concluding that measures to alleviate workers' stress have become more important than ever. With firms adopting new personnel management policies on account of the recession or for the purpose of strengthening their competitiveness, it is possible more workers are being put under increased stress.
The number of corporate pension funds dissolved in fiscal 1999 hit a record high at 3,603. This was attributable, among other things, to a declining yield from fund reserves, and to the increased number of bankruptcies. The reform of public pension schemes has already been carried out, and it is likely that more private firms will take action to reconstitute their own private pension schemes.
Pension schemes in Japan consist of the National Pension Plan and the Employees' Pension Funds. As an adjunct to those pension schemes, in some private companies, corporate pension schemes have been established (Employees' Pension Funds or Tax-qualified Pension Plans). There are legal conditions which firms must meet to be allowed to set up these two types of corporate pension plans. First, they should have 500 or more members to establish an employees' pension fund, and 15 or more members to establish a Tax-qualified Pension Plan. With the corporate pension plan, firms pay premiums on a monthly basis, and their employees, upon retiring, receive an extra pension benefit on top of the benefits they receive from the Employees' Pension Funds. Such corporate pension plans are regarded by many firms as a part of their welfare program for employees. However, the number of these plans has been decreasing every year since 1994 when the bubble economy collapsed. This has also been true in terms of the number of newly participating firms and the number of employees covered.
One reason for this is the increasingly low yield from fund reserves. This has resulted in a shortfall in terms of the benefits which must be paid, and many firms are no longer able to cover the shortfall. Moreover, the amount that private firms have had to pay in premiums to make up such shortfalls totalled a record ¥1.015 trillion in fiscal 1999. The number of corporate pension funds given up because of bankruptcies is also increasing.
Such terminations have also been brought about by the new accounting standards which will come into force next year. These new standards will require enterprises to reveal their financial affairs so that their capital position is readily apparent. In relation to the specific issue of corporate pension funds, the total liability for pensions will be included in the account for each firm, and poor performance in pension funds will negatively affect firms in terms of their corporate ratings and make it harder for them to raise funds. Accordingly, many firms are making up the deficiency in their pension fund reserves when they can afford it, and dissolve their corporate pension funds when they cannot.
The termination of corporate pension funds means that employees, who in theory participate in the funds, receive upon retirement lump-sum payments whose amount is linked to their tenure, but no extra retirement payments. Moreover, such payments are tax-exempt if workers receive them as retirement pension, while simple lump-sum payments are not eligible for such exemption.
Under such circumstances, four ministries (Health and Welfare, Labour, Finance, and International Trade and Industry) have come to recognize the need for a fundamental reform of corporate pension schemes. They have outlined plans for a new type of pension plan, with an eye to having the new type in place during the next fiscal year. This plan is designed to provide retirees with a more varied choice of income sources and to put the financial management of corporate pension schemes back on a sound footing.
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