Wage bargaining is the stuff of the annual springtime labor offensive known as “shunto.” This year’s wage round, however, is essentially different from previous ones because wage increases are not the main subject of labor-management negotiations. The Japanese Trade Union Confederation, or Rengo, the nation’s largest labor group, has given up setting a customary numerical target for wage demands, leaving the initiative to member industrial unions.
Pace-setting metalworkers unions, notably those in the steel, electric machinery and auto industries, have already given up demanding extra wage increases. Employers in these industries are set to make their formal replies in mid-March in accordance with a long-standing custom. Aside from Nissan Motor and perhaps a few other companies, however, it appears to be a foregone conclusion that new pay raises are off the table.
That is hitting small unions particularly hard. Wage talks in the small-business sector normally start later during the shunto, as they are based largely on the levels of concessions won by large unions. In better times, when most companies could afford to raise wages, this phased bargaining formula had favorable ripple effects on small-business wages. Now, however, that virtuous cycle is going into reverse. By the same token, the practice of big-business employers’ making synchronized replies to union demands — which in the past also helped to boost wages across the board — is no longer useful.
Also worrisome is that unions still appear fettered by the same old herd mentality. Their common policy of giving priority to job security over wage increases is understandable, particularly amid record unemployment. Nevertheless, the decision of leading unions to drop wage demands in lock step comes across as a little artificial. It will likely have an especially depressing effect on small-business workers, most of whom are without the benefit of periodic base-pay raises available to big-business employees.
Reducing the wage gap between small and big business has been a major challenge for labor for many years. Under the circumstances, however, the gap is likely to widen. No doubt the ability of Rengo, as well as the metalworkers group, to set the pace for wage increases is severely limited. But considering their leading role in the shunto, it must be hoped that they will try their utmost to stem a downtrend in wages.
Shunto 2003 is significant for another reason: Labor-management talks center on issues called “minimum demands,” such as part-time pay hikes and abolition of so-called service (unpaid) overtime. In particular, wages of 12 million part-timers, including temporary and contract workers, are the main focus of negotiations. The number of these nonregular employees, representing a quarter of the labor force, continues to rise.
One problem is the wide wage disparity between full-time and part-time workers. The difference is about 50 percent for men and 66 percent for women, despite the fact that part-timers actually work almost full-time. And the wage gap between regular and nonregular workers is widening. More than half of part-timers are not entitled to paid leave, according to a government report.
Rengo is demanding, as it should, a better deal for the part-timers as a major goal of the “minimum shunto.” Unions and their industry groups must make maximum efforts toward establishing rules for equal treatment, including the “equal pay for equal work” principle. For such efforts to take root, however, legislative action may be necessary. For a start, labor and management should reach a broad agreement giving direction to such efforts.
Workers known as “freeters” (literally, free part-timers) — mostly young daily workers in service sectors such as fast food and retail — also deserve attention, although they are outside the reach of shunto. Their number, now estimated at nearly 2 million, is also increasing. Many of them are said to have no choice but to work in this way because they are barred from regular employment because of qualifications or availability. It would be unfortunate if they are treated as “throwaway workers,” as a Tokyo high school principal calls them. They are estimated to make an average 1.4 million yen a year. The jobless rate among young people aged 24 and under was 8.4 percent in November, reflecting in part high job turnover.
An official of the metalworkers federation rightly stresses the importance of reaching out to nonunion workers. The unionization rate, which has steadily declined over the years, is now only 20 percent. To breathe new life into the shunto, it is essential that unorganized workers be brought under the umbrella of collective bargaining.
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