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| 5th Report of Market Access Ombudsman Council (March 17, 1998) |
1. Complainant: U.S. Chamber of Commerce in Japan
2. Ministry concerned: Ministry of Labour
3. Complaint:
Because the excessive regulation of Japan's labour environment makes it difficult to provide opportunities for and to appoint talented personnel seeking foreign-affiliated firms, posing barriers to investment in Japan, the following improved measures should be considered.
(1) Provide a new base for the various labour laws and regulations
1) The various labour laws and regulations should be equally fair to employees and employers.
2) Office procedures and the like should be clear, fair, and not require the judgment of responsible counter-based personnel.
3) For the increasingly complicated labour issues, either a special court of law should be established or a labour issue specialist should be appointed to be present in court.
4) The government should privatize functions of the Ministry of Labour such as placement/recruiting services, etc.
5) Interpretation of ILO Conventions should be relaxed to facilitate the competitiveness of Japanese enterprises on the world market.
(2) Certain legalities that should be abolished or revised
1) Abolition of the one-year-contract restriction to make contracts for a free time frame possible
2) The stipulation that all employees are to take lunch at the same time
3) Restrictions on mass layoffs
(3) Items that should be included in the relaxation of various labour laws and regulations
1) The system concerning overtime work, holiday work and late-night work by women should be made equal to that by men.
2) Fee-charging employment placement projects and worker dispatching undertakings
1] The negative list in the regulations on private, fee-charging employment placement projects under the Employment Security Law should not include anything that does not pertain to illegal activities and persons requiring societal protection. It should not include specific industries or occupations, as a rule.
In addition, a simplified permission system and a system for settling commissions based on market supply and demand should be established.
2] The range of occupations for which worker dispatching undertakings is permitted should be specified in accordance with a negative list that is limited to illegal activities and persons requiring societal protection.
In addition, the routine operations of the worker dispatching undertakings should not be supervised excessively.
3) When introducing new technology, regulations on employee contract periods should make it possible to make use of the opportunity. In addition, the government should support employee education and small- and medium-size enterprises.
4) Temporary personnel loans and transfers should not be obstructed by regulations and the like.
5) The concept of the importance of personnel evaluations in settling the place of employment should be legalized.
4. Corresponding Policy of the Ministries concerned:
(1)
1) The various labour laws stipulate what is required of employers, employees, the country and the like and do not grant authority to have either employees or employers overworked.
2) Concerning the complainant's assertion, protection is granted under Japan's Administrative Procedure Law and Administrative Appeal Law. In other words, when a petition is made concerning nonrecognized treatment, the reason is to be clarified in writing (Administrative Procedure Law, Article 8) and the examination standards pertaining to the petition must be made public (Administrative Procedure Law, Article 5), as a rule. Thus, settlement is not based on unclear handling resulting from the arbitrary judgment of labour standard supervisory offices. In addition, parties with grievances may request an investigation based on Article 5 of the Administrative Appeal Law.
3) We agree that at present, it is taking time in court to resolve not only labour problems but others as well, but as improvement of the courts is a judicial problem, it is not within our realm to respond.
4) Placement/recruiting services of Public Employment Security Offices function as a so-called "safety net" which all people can use it fairly and for free to guarantee the people their right to work. It is indispensable for the Japanese government to keep this system to perform the duty of ILO88.
Ordinarily, placement/recruiting services are performed as public organizations in other countries, too. There is no country in which all placements /recruiting services are performed by private companies.
By the way, in the communique of the OECD's meeting of the employment, labour and social affairs committee at ministerial level held in October 1997, it was announced that "Ministers regard the effective provision of placement and related services which enhance the functioning of the labour market as an essential element of a nation's infrastructure."
For these reasons, the government should perform placement/recruiting and related services, and should not privatize them from now on, too.
5) In Japan, under Article 98 of the Constitution, which provides that "the treaties concluded by Japan and established laws of nations shall be faithfully observed", a careful study on the light of conformity with national laws and regulations need to be made enough in ratifying the treaties, and the treaties ratified must be faithfully observed. ILO Conventions also must be met with such strict policy.
(2)
1)
1] Under Article 14 of the Labour Standards Act, to prevent the abuse of untoward physical restraint from a long-term labour contract, labour contracts stipulating terms over one year cannot be concluded, as a rule, excluding those contracts for which no term is stipulated.
2] However, to correspond to the needs of enterprises engaged in creative work activities who wish to utilize for a fixed term domestic or non-domestic personnel with specialized abilities and to correspond to the increase in people who, in keeping with the diversification of values, wish to continue demonstrating specialized abilities without being restrained to a specific enterprise, the necessity of reviewing the current regulations has emerged.
3] In the Program to Promote Deregulation that that Cabinet resolved in March 1997, concerning the upper limit of the term for labour contracts, based on consideration of labour contracts and legislation on the whole, the upper limit of the term of the labour contract has been extended from three years to on the order of five years, particularly for people possessing specialized abilities, people of advanced age following retirement at the age limit, and people involved in projects of a fixed time frame.
4] Concerning the upper limit of the term of labour contracts, based on the recommendation of the Central Labour Standards Investigative Council last December, a proposed law that revises a portion of the Labour Standards Act and includes the content described next has just been submitted to the Diet.
In the following cases, the upper limit of the term of labour contracts should be taken to be three years.
* When securing the relevant personnel for places of work that lack personnel possessing the advanced specialized knowledge, techniques or experience necessary for the development of new commodities, new services, or new technology or for scientific research
* When newly securing the relevant personnel for places of work that lack personnel possessing the advanced specialized knowledge, techniques, or experience necessary for starting, changing, expanding, reducing, or abolishing a business, the work for which is slated to be completed within a set time
* For workers of or over the age of 60
2) No regulation exists that compels all employees to take lunch at the same time.
3) A legal precedent has been established that invalidates layoffs made without rational reasons and a socially acceptable basis. In addition, for an enterprise to engage in organized layoffs, a legal precedent has been set requiring that the following four conditions be satisfied:
* the necessity of reducing staff,
* the necessity of choosing an organized layoff as a means of reducing staff,
* the appropriateness of the personnel targeted for the layoff, and
* the appropriateness of layoff-related methods. We feel that there is no special aspect of this legal precedent that should be revised.
The Labour Standards Act stipulates the following:
* the advance notification procedures in the event of a layoff and the applicable exceptions (Articles 20 and 21) and
* the prohibition of layoffs during the period of days off for an injury sustained at work or hospitalization for treatment of illness and the 30-day-period that follows and during the days off before and after childbirth and the 30-day-period that follows (Article 19).
(3)
1) From the perspective of realizing the equal treatment of men and women in the workplace and expanding the range of occupations for women, the regulations on overtime work, holiday work, and late-night work by women have been revised together with the amendment of the Equal Employment Opportunity Law (Law Respecting the Improvement of the Welfare of Women Workers, including the Guarantee of Equal Opportunity and Treatment between Men and Women in Employment). The regulations on working time of the Labour Standards Law will be the same for men and women from April 1 of 1999, when the Law respecting the Improvement of Ministry Labour-related laws to Guarantee Equal Opportunity and Treatment between Men and Women in Employment (promulgated as Law No.92 on June 18, 1997) will go into effect.
2)
1]
* Respecting views of the Administrative Reform Committee on December, 1995, based on the proposal by the Central Employment Security Deliberative Council on December, 1996, the range of occupations handled by placement agencies has been expanded, and the use of the negative list was begun, allowing all jobs other than those mentioned to be handled since April, 1997.
In addition, based on March, 1997, the Plan for the Promotion of Deregulation, etc. policies concerning further expansion of occupations handled will be decided, based on the ILO 181 Convention on June 1997, etc. Further study will be initiated by the Central Employment Security Deliberative Council in fiscal 1997.
* As for the simplification of procedures and documents related to permission for fee-charging employment placement projects, relaxation of the experience requirements for responsible person with more than a certain years of experience for such introductions has been implemented since April 1997.
* Respecting views of the Administrative Reform Committee on December 1995, based on the proposal by the Central Employment Security Deliberative Council on December, 1996, commissions may be set freely after receiving approval, from April, 1997, (previously, the maximum allowed had been 10.1% of wages paid in the first six months after employment).
2] The Cabinet Order for the Worker Dispatching Law was revised and an additional 11 types of designated works has been added, which, in combination with the previous 16 types brings the total to 26 (Implemented December, 1996).
In addition, based on March, 1997, the Plan for the Promotion of Deregulation, etc. beginning on January, 1997, the Central Employment Security Deliberative Council continues to discuss a comprehensive review of the worker dispatching undertaking system, including the creation of the negative list on the scope of occupations for which worker dispatching is permitted, length of dispatching period, and measures for protecting workers, with the basic direction of review decided on December, 1997. At Present, the Central Employment Security Deliberative Council is engaged in further considerations to take realization of this basic direction.
3) A legal precedent of the invalidity of layoffs made for without rational reason and a socially acceptable basis has been established, and there is no special reason to revise it.
The Labour Standards Act stipulates the following:
* the obligation of providing 30 days notification prior to a layoff or paying some layoff notification compensation instead (Article 20), to alleviate difficulties in living circumstances resulting from a sudden layoff and
* the prohibition of layoffs in the period for injury sustained in the course of work or treatment for hospitalization and the 30-day-period that follows and the days off before and after childbirth and the 30-day-period that follows (Article 19).
4) The precedent is as follows.
1] Clear consent, etc., to the basic stipulations and adoption of employment regulations and labour agreements that dictate transfers is a necessary basis. In addition, a transfer order will be invalid if it is an acknowledged misuse of authority, in consideration of necessity from a work standpoint, rationality of personnel selection, etc.
2] Concerning re-assignments, if there is no necessity from a work standpoint or if there is such necessity, the order will be considered valid, as long as extenuating circumstances do not exist, such as the involvement of unjust motives and purposes, a disadvantage to the worker that is in marked excess of reasonably tolerable limits, and the misuse of authority. There is no special reason for changing this legal precedent.
Under the labour-related laws, there are no stipulations restricting transfers and re-assignments.
(5) Employment regulations on working hours, wages, layoff-related measures, etc., of the relevant workplace are established after the operations chief has considered the opinions of the majority of the workers, but under Article 89 of the Labour Standards Act, an employer of 10 or more workers is obligated merely to create employment regulations and submit them to the authority of the labour standards supervisory office. However, whether layoffs, re-assignments, reshuffling, etc., will be approved and what capability evaluation standards will be used should be left to discussions between labour and management at each place of work, and it is not appropriate to make uniform stipulations by law.