The House of Representatives Committee on Health, Labor and Welfare approved Wednesday a bill to revise the Labor Standards Law to establish legislation on layoff rules for the first time.
The bill invalidates management decisions to dismiss employees if they “lack an objective and logical reason and are considered unacceptable based upon social convention.”
With a majority vote, the Lower House committee passed the bill, submitted by the ruling coalition — the Liberal Democratic Party, the New Komeito party and the New Conservative Party — and the opposition Democratic Party of Japan.
Lawmakers said the bill is likely to be enacted during the current Diet session, which is scheduled to end June 18, and subsequently take effect within six months.
The bill is the product of an agreement reached Monday between the ruling coalition and the DPJ to remove a clause that stipulates an employer’s right to fire employees that was included in the original bill drawn up by the government. The DPJ had demanded it be removed.
The government draft stipulated that “with the exception of restrictions under law, employers can lay off workers.”
The wording was criticized by bar associations and trade union leaders, who claimed it could be understood to mean that employers are free to fire employees at a time when the protracted economic slump has been forcing many businesses into staff cuts.
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