Draft Revised Labor-Related Laws Drawn up
The Study Group for Labor Conditions of the Labor Policy Council has presented a preliminary draft of revisions of labor related laws, which was scheduled to be compiled in this fiscal year, being aimed to be put before the Diet for approval in 2007.
Concerning revision of the working hour regulation, Japan Labor Flash has already introduced the views of the Labour Lawyers Association of Japan, Rengo and other groups which cast great doubt on the plan to establish a "self-regulated working hours system," (See [Special Issue] of No.58 and [Current Topics] of No. 61. of JLF).
Under the drafted revisions, for the purpose of shortening long working hours, employers will be obligated to raise the overtime premium from the current 25 percent to 50 percent if monthly overtime exceeds 30 hours; and grant one paid-holiday if monthly overtime exceeds 40 hours, two paid holidays if it exceeds 75 hours. An increase in payments for overtime and paid holidays will be a substantial burden for employers.
On the other hand, the draft includes a plan to establish the "self-regulated working hours system," whereby workers themselves decide their daily working hours in accordance with varying workloads without being strictly bound by the concept of "eight hours per day" stipulated by the Labour Standards Law. The draft restricts the workers subject to the new system to those earning 10 million yen or more, while Nippon Keidanren (the Japan Business Federation) proposes that the minimum annual earnings should be set at 4 million yen. Quite a few workers will have no payments for overtime if such criteria are adopted.
Another mainstay of the draft concerns improvement in the treatment of dispatched and part-time workers. The draft law obligates employers to hire such non-regular employees whose employment contract has lasted for one year or longer, or has been renewed three times or more, as regular employees if they wish. Under the new rule, firms will be able to secure workers at a cost lower than by taking on regular employees from the beginning, and to adjust their workforce flexibly in accordance with business performance or project plans, whereas workers, by becoming regular employees, will achieve a more stable financial base.
As for the handling of dismissals, the study group has proposed a mechanism of monetary settlements between labor and management even if the cases are ruled invalid by the courts. However, the labor side strongly opposed this proposal, saying that the draft takes no account of discussions made so far. It has opposed the monetary settlement system in the belief that such a system would be just a legal justification of dismissals compensated for by money.
US$=\114 (June 30, 2006)
