The lift of a statutory ban on dispatching temporary workers to the manufacturing sector has long been a fervent wish for many such businesses and personnel providers.
The Ministry of Health, Labor and Welfare has so far been reluctant to lift the ban, but industries hope the Worker Dispatch Law, which stipulates the restrictions, might be relaxed later this year, paving the way for the dispatching of temps to manufacturers.
Intelligence Ltd., a “human resource solution” company established in 1989, is one of the firms most prepared for the expected deregulation.
Intelligence has become the first company in this business turf to acquire licenses to operate three production contracting companies — one each in Sendai, Miyagi Prefecture, Maebashi, Gunma Prefecture, and Odawara, Kanagawa Prefecture.
The three subsidiaries are equipped with production facilities and claim to have auto parts, consumer electronics and information technology-related products manufacturing knowhow.
According to industry insiders, the labor ministry has been reluctant to lift the ban on allowing temporary workers to be employed in manufacturing because decontrol would endanger the employment of seasonal or even regular workers at such firms.
Dispatching temporary workers to the manufacturing sector is feared to create more instability for workers than in other industries. For instance, many electric household appliances, including fan heaters and air conditioners, can be produced by temps in place of seasonal workers.
Another issue often discussed is that manufacturing workers, who are mostly blue-collar ranks, differ from most temp workers, who are considered white-collar, and thus the approach to management differs.
But Satoshi Takebayashi, executive vice president at Intelligence in charge of new business strategies, said he is confident his company can make the planned deregulation advantageous also for workers.
Many production workers already work under a contractual system similar to that for temps, but their employment conditions are even less-advantageous than temp workers face, he said.
“When temp workers are dispatched, they must receive work-related instructions only from the company that accepts them from the job agency,” he said. “In the case of such conventional employment under contract, however, workers are often not given the necessary or appropriate instructions, and thus the total work flow is upset.”
And many small businesses do not put their contract-based workers under the social insurance scheme.
“Unlike employment under contract, which is a convenient tool for companies to cut overhead costs, services provided by temp workers are more organized in terms of stability and continuity, while their rights are fully protected,” Takebayashi asserted.
“Individual workers’ skills can be better evaluated under the temp system. It may be no exaggeration to say that temp services would be the last resort to maintain the tradition of workmanship and the strength of Japanese manufacturing.”
According to official and industry estimates, the number of workers in the manufacturing sector is expected to dip from some 13 million in 1996 to only 9 million in 2005. On the other hand, those working as temps or on contract in the sector is forecast to leap from 490,000 to more than 800,000.
Eyeing great business opportunities in the offing, other job agencies are also preparing for the change in the law.
Adecco Career Staff Ltd. has started employing workers with experience in manufacturing, setting up a separate enterprise.
Pasona Inc. has set up a joint venture firm called Industrial Outsourcing Inc. together with Ikai, an experienced car parts manufacturer in Shizuoka Prefecture.
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