The Japan Labor Flash No.77
Email Journal February 1, 2007

Statistical Reports
Main Labor Economic Indicators
Current Topics
Request for Claim Review by Union regarding Worker Dismissals at
Toyota Philippines Rejected
Job Market for University Graduates Now a Sellers' Market
Nearly 40% of Firms Surveyed Have Engaged in Outsourcing of
Recruitment Activities in Previous 3 Years
Public Policies
Tokyo Metropolitan Government to Launch New SME Subsidy System
to Promote Child-Care Leave
Government did not Submit Bills on "White-Collar Exemption Rules"
to Ordinary Session of Diet
News Clippings
Aeon to Raise Mandatory Retirement Age to 65
Firms Strive to Break Dependence on OJT
Special Issue
Issues in the 2007 Spring Joint Wage Negotiations
JILPT Information

Statistical Reports

-Main Labor Economic Indicators-

http://www.jil.go.jp/english/estatis/eshuyo/200702/index.htm

Current Topics

-Request for Claim Review by Union regarding Worker Dismissals at
Toyota Philippines Rejected-

In a lawsuit in which the Kanagawa branch of the All-Japan
Shipbuilding Industry Workers Union claimed that the failure of
Toyota Motor Co., which was quite influential to the Toyota Motor
Philippines Co., to take any step towards collective bargaining
regarding the dismissal of union members of the Toyota Motor
Philippines Corporation Workers Association was an unfair labor
practice, and called for a remedy, the Central Labour Relations
Commission on December 20, 2006, rejected the union's request.
The Commission judged that since the claim demanded that a Japanese
firm negotiate and respond to a labor dispute occurring abroad, it
was difficult to see how it was a claim subject to the Trade Union
Law of Japan.


-Job Market for University Graduates Now a Sellers' Market-

In January 2007, the Ministry of Health, Labour and Welfare and
the Ministry of Education, Culture, Sports, Science and Technology
published the findings of a survey on unofficial job offers (as of
December 1, 2006) to final-year university students and other
students about to graduate at the end of fiscal year 2006. According
to these findings, 79.6 percent of university students due to graduate
were promised employment, an increase of 2.2 percent compared to the
previous year. The proportions of those who received job offers were
80.9 percent for males and 78.2 percent for females, improvements of
2.0 percent and 2.7 percent, respectively, over the previous year.
The proportion of two-year college students who received job offers
to those wishing to work after graduation stood at 54.2 percent,
an increase of 4.2 percent compared to the previous year.

The total number of university students who are about to graduate
and wish to work afterwards reportedly equals that recorded during
the bubble years of the early 1990s, a sign that the labor market
for new graduates has become a sellers' market. Even so, firms have
been getting stricter in the selection of students, quite a few of
whom are reportedly having difficulty in obtaining job offers.


-Nearly 40% of Firms Surveyed Have Engaged in Outsourcing of Recruitment
Activities in Previous 3 Years-

The Ministry of Health, Labour and Welfare recently published a
"Report on the Current Situation of the Recruitment and Hiring of
Workers," based on a survey conducted among 2,048 firms. According
to the report, nearly 40 percent of the firms surveyed have
outsourced recruitment activities of one kind or another during
the past three years. The report also states that some 40 percent
of the firms surveyed call on job applicants to fill in and submit
an "entry sheet", which firms design themselves with specific
questions and which applicants submit via the Internet.

Public Policies

-Tokyo Metropolitan Government to Launch New SME Subsidy System to
Promote Child-Care Leave-

The Tokyo Metropolitan Government, faced with the lowest birthrate
among all the prefectures of the country, has decided to launch in April
(starting month of fiscal year 2007) a subsidy system for small and
medium-sized enterprises (SMEs) to encourage workers to take child-
care leave. Apparently it is difficult for employees of SMEs to take
child-chare leave compared to employees of large firms.

Under the new system, the Metropolitan Government will subsidize
half the salaries, at a maximum of 1.5 million yen per person, for
dispatched and part-time workers whom SMEs need to hire as substitutes
for employees taking child-care leave of one year or longer for the
first time. In principle, the scheme will cover the first substitute
worker, up to a maximum of three substitute workers if other regular
workers take such leave when the first regular worker is still on
leave. SMEs with 300 or fewer employees are eligible for the subsidy
scheme.

The Metropolitan Government also plans to subsidize the cost of
establishing rules and educational programs to help SMEs create work
environments that make it easier for employees to take child-care
leave, though it is rare for municipal governments to launch an
integrated, large-scale package of subsidies.

Subsidies for the cost of hiring substitute workers to fill in for
regular employees on child-care leave are also available from the
central government, though the subsidies are paid on a fixed-amount
basis: 500,000 yen for workers taking child-care leave for the first
time at a small or medium-sized company, and 400,000 yen for those
at a large firm. The subsidies are 150,000 yen and 100,000 yen,
respectively, for the second and subsequent workers, with the scheme
allowing a maximum of 200,000 workers per year to take the leave.

US$=120yen (February 1, 2007)


-Government did not Submit Bills on "White-Collar Exemption Rules"
to Ordinary Session of Diet-

The Japan Labor Flash has already reported on the debate about the
adoption of a Japanese version of the "white-collar exemption rules" -
that is, a system excluding workers satisfying certain conditions from
coverage by "working hours" regulations. Finally, the government decided
not to submit its bills on the exemption rules to the current ordinary
session of the Diet convened on January 25.

The decision followed the judgment of Prime Minister Shinzo Abe,
who indicated that the rules were not widely acceptable to the public
at present.

The number of workers to be covered, as estimated by the Ministry
of Health, Labour and Welfare and announced by the Minister Hakuo
Yanagisawa, on January 10, was 200,000 (approximately 0.4 percent
of workers as a whole), but even here labor and management raised
serious questions. While labor criticized the figure, saying that
the government, with an eye to the House of Councilors' election
this summer, had been obliged to produce an underestimate so as to
convince lawmakers affiliated with the ruling parties, who were
strongly cautious about the exemption system, management warned that
it would almost certainly cause confusion if adopted as is, since
the criteria for reducing the number of people subject to the system
were still ambiguous.

The estimated number, 200,000, was calculated by subtracting from
a total of 5.4 million workers with an annual income of 9 million yen
or more, 3 million workers who must be in supervisory posts, that is,
directors and section chiefs; 2 million workers who were not authorized
to decide themselves how to approach their assignments; and 200,000
workers who were not white-collar.

News Clippings

-Aeon to Raise Mandatory Retirement Age to 65-

Aeon Co. has announced that in February it will raise the mandatory
retirement age for its regular employees from the current 60 to 65,
and will continue renewing employment contracts for part-time workers
until they reach 65. In the face of the upcoming mass retirement of
baby-boomers, this leading supermarket chain aims to keep experienced
and skilled workers longer.

The latest step will benefit some 120,000 workers: some 15,000
regular employees and some 105,000 part-time workers. Aeon is one of
the few large firms to extend the mandatory retirement age.

The conditions of treatment applied at age 59 will continue to apply
to regular workers wishing to maintain the same work assignment and
working style until they reach 65, whereas their salaries will be
cut to about 80 percent of those paid at age 59 if workers specify
particular workplaces or working hours.
(Tokyo Shimbun, December 2006)


-Firms Strive to Break Dependence on OJT-

Various companies are now adopting new methods of human resource
development for their young and mid-career staffs.

Advertising companies aim to enhance employees' ability to put
forward new proposals by running simulations of practical work such
as drawing up proposals for, for example, brand strategies and new
products. Firms have expressed a growing sense of crisis - a general
manager in Asatsu-DK Inc. explained that traditional on-the-job
training is no longer sufficient to meet changes in the market and
customer needs.

Last year, Dentsu Inc., Japan's largest advertising company,
adopted curriculums from the most highly rated graduate school in
the U.S., and selected about 20 employees who had been with the
company 11 years or more to analyze case studies of the advertising
industry abroad and draw up proposals.

On the other hand, Asatsu-DK Inc. has begun communication training,
based on collaboration between the in-house college, where employees
learn specialized skills for the advertising business, and the company's
human resource division, aimed at enhancing the ability of young staff
- employees who have been at the company three years or less - to solve
problems.

In April, Tokyo Gas Co. is to adopt a "free agent" system allowing
its workers to choose job titles for themselves. Employees with five
years or more of work experience with the company are eligible for the
new system, through which Tokyo Gas aims to motivate them in carrying
out their duties with full their might.
(Nikkei Sangyo Shimbun and Fuji Sankei Business i, January)

Special Issue

-Issues in the 2007 Spring Joint Wage Negotiations-

On January 15, Nippon Keidanren (the Japan Business Federation) and
Rengo (the Japanese Trade Union Confederation) held an informal top
-level meeting at which they expressed their views about the spring
joint wage negotiations. Since their approaches to the negotiations
have already been clarified, there were no particularly new issues;
however, the meeting highlighted conflicting points which have emerged
partly because of the economic recovery underway which will shape the
actual opening of the 2007 spring struggle.

Continued on;
http://www.jil.go.jp/english/archives/emm/2003/no.77/77_si.html

JILPT Information

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