Tricks with labor rules

The draft of the Abe administration’s economic growth strategy calls for writing rules in fiscal 2014 for the employment and dismissal of quasi-full-time workers whose status falls between full time and irregular.

Quasi-full-time workers work a particular type of job or in a specific geographical area and are given permanent employment like full-time workers. But if a company decides that the job has become unnecessary or closes a factory or a branch office in that particular area, in principle they will be fired.

The government says that quasi-full-time work will help diversify the way people work and will contribute to accelerating the transition of irregular workers to permanent employment status. But it is clear that quasi-full-time workers will be easier to dismiss than conventional full-time workers.

The government’s policy will result in management accelerating its moves to increase the number of quasi-full-time workers by decreasing the number of conventional full-time workers. Given the current difficult economic conditions, management prefers to hire workers whom it can fire easily. And the policy will unlikely result in a large number of irregular workers becoming quasi-full-time workers.

The basic idea of two government panels that have proposed wider use of quasi-full-time workers is that easing regulations for the dismissal of workers will contribute to the expansion of employment.

Deplorably, no representatives from labor sit on the panels. Labor organizations rightly suspect that the government plans to create a large number of workers with “permanent employment status” whom management can easily fire as it deems necessary.

According to judicial precedents, in cases dealing with the dismissal of surplus workers, courts must judge such factors as whether there is a logical necessity to reduce employment, whether management has made sufficient efforts to avoid the dismissal of workers, whether the standards for selecting workers for dismissal are appropriate and whether management followed proper procedures for dismissal, such as giving explanations, allowing consultation and gaining workers’ understanding.

Given judicial precedents, government panels think that Japan’s rules makes the dismissal of workers too difficult, thus preventing worker migration into growing industries.

If a company closes a factory or a branch office, it is currently required to make efforts to prevent the dismissal of concerned workers. But the government wants less stringent rules for dismissing quasi-full-time workers. It also calls for simplifying the procedure to introduce a particular type of discretionary work.

The government should pay attention to the fact that the study by the Organization for Economic Cooperation and Development shows that Japan’s rules for workers’ dismissal are less stringent than the average among OECD member countries.

Under past Liberal Democratic Party governments, labor regulations were eased and the percentage of irregular workers in the total workforce increased to 35 percent.

In Japan, nearly 90 percent of workers are employed by companies. Steady economic growth driven by consumer demand will not take place without stable employment. The government should stop trying to make rules for dismissing workers less stringent. Instead, it should concentrate on nurturing new industries that will create new employment opportunities.