Changing Employment and Wage Systems

(1) Daiei Introduces its Unified Personnel System for Both Full-time
and Part-time Employees

The major supermarket chain Daiei has decided to remove the differences
in the way it manages its full-time and part-time employees, and began
implementing a new integrated system in May.

The new system affects all 11,000 full-time and 55,000 part-time
Daiei employees. Under the new system, Daiei employees will be bound
to one of three types of employment contracts based on their work hours
and their acceptance of workplace transfers. The three contracts are
as follows:

* Type A, offered to employees who can work full-time and who would
agree to being transferred;
* Type B, offered to employees who can work full-time but who would
refuse to be transferred; and
* Type C, offered to employees who work part-time and who would refuse
to be transferred.

Under the new system, even workers who were originally hired as
part-time employees under a Type C contract can switch to a Type B
contract and be promoted as high as store section chief. And if they
agree to be transferred, they can be switched to a Type A contract
(which is the same as what "full-time employees" signed before the
new system was introduced) and become eligible to be promoted to store
manager or even company executive, thus greatly opening up the freedom
of employee work choices and introducing greater promotional opportunities,
even to part-time employees.

Employees will be hired by Daiei through ordinary job recruitment
programs as well as through recommendations. In addition to the above
three contracts, Daiei has set aside a separate system of one-year
employment contracts offered to professionals, sales experts, and
management experts who will be paid on a fixed annual salary basis.


(2) Celestica to Introduce a Merit-Based Wage System in Japan

Celestica Inc. of Canada, (consignment service company in the
manufacture of electronic machine) which recently acquired an NEC
factory together with its employees, will introduce a merit-based
personnel and wage system at its two Japanese factories in fiscal 2003.

In Japan, even companies that have merit-based systems for their
white-collar employees do not apply them to the blue-collar workers
working at their factories. Celestica seeks to change this. The new
personnel and wage system will affect all 900 employees at its
factories, including skilled workers at its production lines.

Celestica is currently in the process of reviewing the system it
uses in its head office in Canada and is finalizing the details of
the new system. In principle, employee performance will be assessed
by their superiors, and this assessment, together with the company's
overall performance, will be used to determine an employee's wage.
Celestica hopes to introduce a system whereby wages will be paid above
a certain minimum according to employee performance.

It is generally thought to be difficult to assess individual
contribution to production line work because of the strong element
of teamwork involved in such work. Celestica has adopted a "cellular"
work model in which individuals assemble a product from the parts
upwards instead of using assembly lines, making it possible, they
believe, to identify the different skill levels of its employees and
make meaningful assessments of individual performance.
(Nikkei Shimbun, April)