The Abe administration has begun discussions for tightening regulations on overtime work in an attempt to rectify the notoriously long working hours at Japanese firms — which not only threatens the health of company employees but is also blamed for leaving them with little time to spend with their families. This causes difficulties for couples raising children. The government’s resolve for pushing through this agenda will be tested by whether and how it will overcome anticipated opposition from business circles. The administration so far has a track record of pushing for deregulation of labor rules, such as exempting certain workers from work-hour regulations. It needs to demonstrate its seriousness by coming up with effective measures to reduce overtime work.
This seems to be another example of Prime Minister Shinzo Abe’s newfound interest in labor-friendly issues. Along with his bid to introduce an equal pay for equal work principle — supposedly to improve conditions for the nation’s growing ranks of irregular workers — the administration plans to consider a cap on overtime hours by revising the Labor Standards Law. It plans to feature the outline of the policies in a plan to be compiled next month for Abe’s pet project to “promote the dynamic engagement of all citizens.”
According to OECD statistics, workers in 2013 put in an average of 2,071 hours in South Korea, 1,795 in the United States, 1,746 in Japan and 1,713 in Canada. These figures are far higher than in many European economies — 1,313 hours in Germany, 1,401 in France, 1,478 in Italy, 1,328 in the Netherlands and 1,659 in Britain.
Average working hours per year in Japan have been on a gradual decline. But this is mainly because part-time workers are making up a larger percentage of the nation’s labor force. Working hours for full-time employees have reportedly not declined so much.
The chronically long hours are linked to the problem of overwork, which can cause labor accidents, overwork-induced deaths and suicides. The practice also hampers the full participation of women in the labor force in various ways. In fiscal 2014, there were 277 cases of labor accidents in which company employees suffered brain or heart diseases that were blamed on their heavy workload, and in most cases the workers had logged more than 80 hours of overtime each month.
One reason Japan has been slow to reduce working hours lies in the Labor Standards Law. It limits work to eight hours a day and 40 hours a week. But a company’s management can make employees work longer if it concludes an agreement with the firm’s labor union in accordance with Article 36 of the law. Overtime of up to 45 hours per month and up to 360 hours per year is allowed under such an accord. And the law also says labor and management can sign an agreement with a special provision that allows more than 45 hours of monthly overtime for up to six months of the year for such reasons as busy seasons. Such accords effectively circumvent the limits on overtime hours. According to a 2013 survey by the Health, Labor and Welfare Ministry, 62 percent of big companies and 26 percent of small and medium-size businesses have labor-management accords with such a provision.
Reportedly under consideration by the government is setting a uniform cap on overtime hours and having penalties for firms that violate the limit. To reduce overtime and protect the health of workers, such steps are long overdue. The government should follow the lead of the European Union, which has a limit on overtime.
Business circles may oppose such moves, testing the Abe administration’s resolve. Another question will be whether the regulations will be effective enough to curb overtime hours. The measure will be meaningless if the limit is set too high. The government is reportedly weighing exceptions to the planned rule for certain sectors and job categories. But the regulations will lose their meaning if the exceptions are broadly allowed.
The government should be prepared to block any attempts by businesses to get around the tightened regulations, for example by forcing their employees to work overtime without logging the hours — a problem that is said to be widespread even under current rules. It also needs to beef up manpower at labor standards offices so they can keep a closer watch for violations.
Last year, the Abe administration submitted to the Diet a revision to the Labor Standards Law to lift work-hour limits for certain “highly professional jobs” who will be paid on the basis of their work performance instead of the hours they log in at the office. Since such workers would not receive any overtime pay, critics such as labor unions charge that the proposed system would exacerbate the problem of overwork.
It is expected that the planned new regulations on overtime hours will not apply to such workers. The administration appears to be pursuing two mutually contradictory policies. The public and lawmakers need to scrutinize whether Abe is really serious about reducing the working hours of the nation’s corporate employees.
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