Many temp workers to see contracts terminated from September due to staffing law

JIJI

Many temporary workers dispatched by staffing agencies are expected to see their contracts ended without renewal after Sept. 30, the third anniversary of a revised staffing law coming into effect.

The revised law bans the use of haken dispatch workers at the same workplace for more than three years, to encourage companies to hire them as regular employees.

The law is aimed at preventing staffing services from becoming an alternative to permanent hiring, and at helping every worker develop his or her career, according to the labor ministry.

However, demand remains strong for dispatch workers despite improved business conditions as it is easier for companies to let their contracts expire than to dismiss regular employees.

In the aftermath of the 2008 financial crisis, many companies terminated or refused to renew contracts for dispatched workers.

The revised law allows dispatch workers to work at the same workplace beyond the three-year limit if staffing agencies conclude permanent contracts for them. But many agencies are reluctant to take this step.

Since the beginning of this month, Haken Union, a group supporting haken workers, has been consulted by workers every day about the issue of contract termination.

Among them is a woman in her 40s who has been working at a financial institute for about 10 years. She was recently notified that her contract will not be renewed beyond next February, when she will reach the end of the third year period since she moved to her current staffing agency.

She hopes to continue at the same workplace, so Haken Union will help her negotiate with her agency.

Under the revised law, companies are allowed to use dispatch workers for the same position indefinitely by replacing them with new workers every three years at the latest after hearing opinions from labor unions.

“It wasn’t a good amendment,” said Haken Union head secretary Shuichiro Sekine.

There are moves to permanently employ dispatched workers in industries facing severe labor shortages, particularly the retail and logistics sectors.

Tokyo-based iDA, which dispatches sales personnel to the fashion industry, said last month that it will convert some 320 dispatched workers reaching the three-year deadline to permanent employees if they wish.

But such moves seem unlikely for certain jobs, such as clerical work, for which the ratio of job openings to seekers was low — at 0.45 in June.