LABOR-MANAGEMENT RELATIONS

Vol.35-No.09 September 1,1996

An Overview of the Final Results of Shunto Wage Talks

By industry, the highest wage increase was registered in construction with ¥12,635, followed by wholesale and retail trade (¥10,455) and newspapers and printing (¥10,111). In contrast, the lowest wage raise was posted in the steel industry at ¥4,685, followed by rubber products (¥6,884) and textiles (¥7,056). In terms of the increase rate, newspapers and printing won the highest pay raise of 3.42 percent, followed by electrical machinery (3.18%) and wholesale and retail trade (3.16%), while steelmakers received the lowest pay hike of 1.62 percent, followed by rubber products (2.26 percent) and services (2.35 %).

According to the final results, compiled by Rengo (Japanese Trade Union Confederation), the nation's largest national center, labor and management agreed upon a wage increase of ¥8,227, or 2.83 percent, up ¥201, or 0.02 point over a year earlier. The results of Rengo's survey are based on wage talks settled on May 29 at 1,269 of 1,403 affiliated labor unions.

Nikkeiren, meanwhile, compiled its final results of the wage increase talks settled on at 289 major companies. Labor accepted a wage increase of ¥8,627, or 2.81 percent, down ¥383, or 0.01 point from last year's level. The results of its survey covering 420 smaller-scale companies with 500 or fewer employees showed a wage increase of ¥6,842, or 2.72 percent, up ¥60, but down 0.02 point from the previous year.

Scrap Protective Provisions for Women:
Rengo Central Committee Calls for Strengthening of Equal Employment

At its central committee meeting held in Takamatsu City on June 4, Rengo's leaders made a proposal calling for revision of the Equal Employment Opportunity Law (EEOL) and the Labour Standards Law (LSL) and won approval of its original proposal with some amendment. Calls for revision of the two Laws are most strongly characterized by the fact that Rengo seeks scrapping of protective provisions for women in the LSL and alteration of the current EEOL into a law with stronger binding power. Under the present EEOL, employers should attempt to provide women with equal opportunities in recruitment, employment, assignment and promotion. In its proposal, Rengo demands the Law be revised to forbid discrimination by sex in all stages of the employment process.

In line with this, Rengo for the first time set forth its proposal to eliminate the protective provisions for women (provisions on overtime, late-night work and work on holidays), excluding maternity-related provisions. Under the present LSL, women can clock a maximum of 150 annual overtime hours. In Rengo's proposal, women will be allowed to work up to 360 annual overtime hours, and men, to work the same overtime hours for the time being.

Rengo decided to call for the scrapping of protective provisions for women in regard to overtime and work on holidays. It, however, expressed the view that it should be cautious on eliminating the protective provisions for women concerning late-night work and that it should maintain the present provisions. In response to the view expressed about being cautious on eliminating of the protective provisions regarding late-night work, the leaders amended their original proposal, stating that they "will begin to study, from a multifaceted perspective, elimination of the protective provisions on late-night work in consideration of the realities of male and female responsibilities as family members and changes in employment structure." They thus decided to continue their discussion over the proposal within the confederation. Zensen-domei (Japanese Federation of Textile, Garment, Chemical, Commercial, Food and Allied Industries Workers' Unions), however, voiced objection to Rengo's amended proposal, advocating relation of the protective provisions. They argued "We have a history of having won by striking prohibition of women's late-night work." To this, Jidosha-soren (Confederation of Japan Automotive Workers' Unions) stressed its position, contending that "men and women should stand on an equal footing to expand women's fields." Thus, in its unusual resolution by show of hands, Rengo witnessed the proposal, which affirms the continued discussion on the issues, passed by a majority.

New Action Policy of Tekko-roren and Denki Rengo

Labor and management are moving to review shunto wage talks, the nation's system of wage negotiations. In particular, there have emerged labor union moves toward a plural years-based agreement instead of annual-based negotiations on working conditions, namely a wage increase, thus constituting one of the focal points of debate at regular meetings of individual labor unions.

Tekko-roren (Japan Federation of Steel Workers' Unions) sparked the debate on the issue. After the settlement of its 1996 shunto wage negotiations, the federation raised the question that the labor movement should shift from an emphasis on wage hikes to an emphasis on rectification of the high-price structure resulting from the domestic-foreign price gap, noting that "we are now under pressure to review shunto including determination of working conditions as the nation will, from the mid- and long-term perspective, face lower economic growth, lower prices and high unemployment."

Major steelmakers turned ordinary profits into the black in fiscal 1995. This, however, was brought about by cost-cutting measures with personnel cuts at the core. In 1996 wage talks, management said that they need to make continuous restructuring efforts and were reluctant to increase wages. What management said was that imports of low-priced steel from South Korea drove the prices of Japanese steel down to almost a 20 years ago level and that a wage hike, which will lead to an increase in fixed expenses, will threaten the infrastructure of employment.

Responding to the structural development, Tekko-roren recognizes that they are now in an age in which they cannot expect large wage hikes even if they have better corporate performance. They think that they should endeavor to improve living standards by reducing prices, which are higher than those in other countries, rather than to increase wages. Regarding the relationship between the high cost-of -living structure and the shunto system, Tekkororen pointed out that "even those industries and companies which are not backed by higher productivity fall into line with each other in raising wages to the average level, and a repeated shift of such costs to prices has led to the country's structure of high consumer prices." They thus call for the introduction of a mechanism which allows market principles of non-competitive fields to function properly by promoting thorough deregulation. Tekko-roren will continue to discuss the review of shunto, assuming that an agreement period will be set at 2 years for the time being. If labor moves to the new shunto system, they will do so in the 1998 shunto wage talks at the earliest. Within the federation, smaller-scale member unions in particular are strongly opposed to the new moves, arguing that "wage talks every other year will further widen the gap in wage increases between us and major unions."

Denki Rengo (Japanese Electrical Electronic & Information Unions) has also declared that it intends to tackle shunto reform, such as an overhaul of wages, employee treatment and employment systems as a whole. At its annual convention, the chairman of the organization declared that they will take a forward-looking stance of examining the introduction of shunto wage talks every other year. But many members expressed, in the discussion, that they should be cautious about introducting the new system. At present, views supporting the new system are expressed by a few other industrial organizations and there will likely to be many twists and turns before labor unions actually shift to the new system.

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