Vol.38-No.10 October 1,1999
With the deteriorating employment situation, the idea of work-sharing has drawn some attention. For example, Hino Motors introduced a work-sharing scheme in June, the first large company to do so.
Due to a substantial drop in demand for its products, Hino Motors, a Toyota affiliate engaged in truck production, went into the red for the first time since it was listed on the market. Its loss was about ¥42 billion at the end of the March 1999 accounting quarter. In this year's spring offensive, management presented a proposal for overall reductions both in working hours and wages of all employees. The subsequent negotiations finally resulted in a reduction of scheduled working hours from eight to seven, and a cutback of wages by some 11 percent for about 250 union members aged 55 or older who were engaged in support sections. The scheme was an emergency measure to cut labor costs and will be in operation until the end of March 2000. The company has also been accepting applications for the early retirement of 200 employees by the end of July.
In a January 1999 report issued by the Labor Issue Study Committee of Nikkeiren (Japan Federation of Employers' Associations) management's approach to the 1999 spring offensive was summarized. It argued that employment stability was most important, emphasizing that management and unions should work together in a flexible manner to adjust labor conditions. The report mentioned the idea of work-sharing with wage reductions.
The Japan Productivity Center for Socio-Economic Development (JPC) has released its latest estimates, pointing out that job openings would be created for 2.6 million people if enterprises gave up all overtime work (by regular employees). According to a survey by the Ministry of Labour, the average employee works 12.5 hours per month in formal overtime. A questionnaire-style survey of lifestyles conducted by Rengo (Japanese Trade Union Confederation) has revealed that “service overtime” work — where employees work overtime without being fully paid — averaged 6.9 hours per month. Based on these figures, the JPC estimates that 900,000 jobs would be created if firms did away with service overtime and that an additional 1.7 million jobs could be created if formal overtime work was abolished. Accordingly, the JPC recommended that companies should consider introducing a work-sharing scheme. Rengo stressed the necessity of getting rid of service overtime itself before discussing work-sharing. However, it has argued that employment mobility should not be advocated when labor was not in high demand, and has suggested that the government, management and labor unions should issue a declaration on employment stability, proposing that the three parties should come to grips with the present economic crisis and work toward a widely based consensus on work-sharing.
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