Step to trim overtime falls short

The legal cap on overtime work hours, agreed on this week between business and labor leaders at the urging of the Abe administration, fails to provide sufficient minimum protection against long working hours that impair the health of corporate employees. The regulation, which will allow a worker to clock monthly overtime just shy of 100 hours during busy seasons, will hardly serve as a guarantee to stop excessively long work hours from causing the deaths and suicides of employees — as it ostensibly sought to achieve.

Both the management of businesses and labor unions need to make further efforts to ensure that the excessive overtime hours that threaten the health of corporate workers will not be the norm. The government also needs to crack down on widespread practices that make work-hour regulations meaningless by manipulating employees’ work records.

Prime Minister Shinzo Abe, who pushed for a ceiling on overtime hours as a key part of his “work-style reform” drive, hailed the agreement as a “historic reform.” His administration will prepare an amendment to the Labor Standards Law based on the agreement.

It will indeed be a step forward in that the labor law will set an upper limit on overtime hours with penalties on violators. While the law limits work hours to eight hours a day and 40 hours a week, companies can implement management-labor agreements that allow employees to work overtime for up to the Health, Labor and Welfare Ministry’s guideline of 45 hours a month. But the agreement can include special clauses that permit employees to work overtime beyond the guideline for up to six months a year, and there is no legal limit on how far the overtime cap can be stretched.

The problem with the agreement, which essentially endorsed the government’s draft proposal, is that the cap is set so high. It will allow maximum monthly overtime of “less than 100 hours” during a busy season and an average of 80 hours of overtime if the season stretches over two to six months, with annual total overtime capped at 720 hours, or 60 hours a month on average. Those limits are essentially the same as the health ministry criteria in linking workers’ fatal brain and heart illnesses to overwork under the labor accident compensation scheme. It must be noted that the criteria gives no guarantee against death from overwork — of the 96 karoshi cases recognized in fiscal 2015, 54 involved workers whose monthly overtime fell short of 100 hours.

Rikio Kozu, head of Rengo (Japanese Trade Union Confederation), who had earlier called the 100-hour monthly limit “unacceptable,” said it is wrong to take the new regulation to mean that businesses can have its employees work overtime for up to 100 hours a month. But the lax regulation can effectively signal that the law condones a level of overtime work that could threaten workers’ health. In opposing lowering the overtime cap from the proposed 100-hour level, Keidanren (Japan Business Federation) chief Sadayuki Sakakibara argued that any regulation “that is too removed from the status quo will spoil the competitiveness” of the companies. The business community needs to realize that the status quo has allowed the chronically long working hours of corporate employees in this country. Sakakibara’s statement leaves his commitment to the agreement — which calls for a fundamental overhaul of the “corporate culture that relies on the long working hours” of the employees — in doubt.

It must be noted that the latest agreement mandates efforts to bring the maximum overtime hours closer to the health ministry guideline of 45 hours a month and 360 hours a year. Both business management and labor needs to honor the agreement and bring the reality closer to the principle. While the accord calls for a review of the limits in five years, the relevant parties need to constantly monitor the effects of the regulation to see if it needs to be updated so that it will serve the purpose of protecting workers’ health.

The government needs to make sure that the planned overtime regulation will be honored. The prevalent practices of “service overtime” at many businesses of getting employees to work beyond regular hours without clocking overtime and denying them extra pay makes any such regulation meaningless. At the major advertisement agency Dentsu Inc., where a 24-year-old worker killed herself in 2015 while suffering from overwork-induced depression, it has surfaced that many employees were told to underreport their overtime hours to make it look like they worked hours within the limits under the agreement with its labor union.

Any regulation on work hours will not be effective unless such wrongdoings are rooted out and punished. Beefing up surveillance against illegal labor practices, including by expanding manpower at labor inspection offices across the country, will be essential to crack down on such practices and ensure that the workers’ long overtime hours are reduced in real terms.