EMPLOYEE RELATIONSIN JAPAN

By Rasika R Salodkar M14087 (HR)

JAPAN World’s third largest economy and Remains cutting-edge in business Unique player in the Asia-Pacific Doing business in Japan is safe, relatively deregulated, consistent,

profitable and enjoyable Constitutional monarchy governed by the Japanese Constitution, a

“supreme law” which declares that sovereign power resides with the people

Population of 127.5 million people, an area of 377,799 square kilometres and a GDP of US $5.960 trillion

Power is separated into Legislative, Administrative and Judicial Power, exercised by the Diet, Cabinet and Courts, respectively

Main employment legislation is the Labour Standards Law (roudou kijun hou) and the Labour Contract Law (roudou Keiyaku hou)

LABOUR LAW Established within this constitutional framework Elaborated by acts, ordinances, collective agreements

and work rules Three major labour laws:

1. the Labour Standards Law (LSL)- Regulates working conditions and the workplace safety and hygiene

2. the Trade Union Law (TUL)- Guarantees the worker's right to organize and to bargain collectively

3. the Labour Relations Adjustment Law (LRAL)- Deals with management adjustments and means of dispute settlement

• Acts apply to Japanese employees of the private sector, including foreign workers possessing a visa with a work permit

TRADE UNIONS The freedom of workers' associations is granted in Art. 28

of the Constitution Trade unions are ruled in the Trade Union Law (TUL) Definition: The organisations, which are formed

autonomously and composed mainly of workers for the main purposes of maintaining and improving working conditions and raising the economic status of workers

Legally covered are all workers, except for those either with a supervisory position or working for welfare or political and social movements

Registered by the Labour Relations Commission and have a legal personality as well as legal protection

Any discrimination because of trade union activities is forbidden, and the employer must not have any influence on the trade union's management

CURRENT SCENARIO OF TRADE UNIONS In 1999, 1,1700,000 workers of the

private sector were unionized Unionization rate has been declining

during the last 50 years Over 90% of the unions are formed

within the limits of one company Enterprise unions engage in activities

and issues related to their members within the enterprise

Industry federations are generally constituents of the nation-wide Japanese Trade Union Confederation (Rengo)

Rengo was founded in 1989, absorbed rival national organisations and embraces now unions of the private as well as from the public sector

STRIKE TYPOLOGY AND DISPUTES All workers except police, firemen and prison guards Article 28 of the Constitution guarantees the workers' right to

act collectively Labour Disputes: a disagreement over claims regarding

labour relations arising between the parties concerned with labour relations resulting in either the occurrence of acts of dispute or the danger of such occurrence

For labour disputes, the trade union and its members are liable neither under civil law nor under penal law, as long as they act properly and are a part of a legally registered trade union

Legally recognized acts of disputes: strikes, slowdowns and other acts hampering the normal course of work, like the order to all workers to take holiday on the same day or the posting of posters on the establishments premises, shutting down the flow of traffic through the gates, etc

workers are paid no wages while striking

LOCK OUTS: Employer's right to lock out employees is not

constitutionally and legally established (unlike India) Recognized as a right of defence by a majority Employer needs to gain first an injunction from the court

LABOUR DISPUTES: Can be settled upon request of one or both parties by

conciliation, mediation or arbitration Each form of settlement is strongly influenced by the

Labour Relations Commission, a body representing equally workers, employers and the public

COLLECTIVE BARGAINING (SHUNTO) Right of workers and unions to bargain collectively is

guaranteed, irrespective of size and unionisation rate, under Article 28 of the Constitution of Japan and Article 7 of the Trade Union Law

Collective bargaining predominantly takes the form of enterprise-based bargaining

Unique feature of Enterprise-based bargaining: employer and enterprise-based union have almost complete autonomy over the process

Article 17 of the Trade Union Law regulates the general binding power of a collective agreement

It states: when three-fourths or more of the workers of the same kind regularly employed in a particular factory or workplace come under application of a particular collective agreement, the agreement concerned shall be regarded as also applying to the remaining workers of the same kind employed in the factory concerned or workplace

GRIEVANCE PROCEDURE Grievance procedure, in industrial

relations, process through which disagreements between individual workers and management may be settled

Designed to deal with problems concerning the interpretation and application of a collective agreement between a company and the union, and other day-to-day employee grievances

Grievance procedures are rarely used to settle labour disputes as the rules of grievance procedures set forth in collective agreements are simple

DISPUTE SETTLEMENTA) CONCILIATION (Chotei)

The most feeble form of settlement One or more conciliators are nominated by the

Labour Relations Commission A conciliator is a person with experience in the

settlement of labour disputes (Art. 11 of the LRAL) He / She acts as an intermediaries between the

parties (Art. 13 of the LRAL) In the event of not being able to effect a

settlement, the conciliator must withdraw If withdrawn, a conciliator must report the

confidential facts of the case to the Labour Relations Commission (Art. 14 of the LRAL)

Simple and inexpensive, they are widely used

B) MEDIATION carried out by a mediation committee representing workers,

employers and the public in equal number The committee, which is nominated by the Labour Relations

Commission's chairperson, has the power to draft a proposal of the settlement (Art. 26 of the LRAL)

directed at the expeditious resolution of disputes arising between telecommunications carriers through mutual concessions by both parties and with the intervention of the Mediator

Mediator is appointed by the Telecommunications Business Dispute Settlement Commission (TBDSC)

Mediator's function is to cooperate in seeking out points of agreement between the parties in dispute and, once such points are identified, working towards resolving the matter in line with mutually agreeable conditions

It can also put pressure on the acceptance of the proposal with the help of the press

C) ARBITRATION the strongest and actually most rarely chosen form of labour

dispute settlement but not so common in Japan An arbitration committee from among the members of the

Labour Relations Commission is nominated by the commission's chairperson

The arbitration committee meets and listens to other members of the Labour Relations Commission representing employers and workers (Art. 31-5 of the LRAL)

It takes a decision in writing - known as an arbitration award - which has the same effect as a collective agreement (Art. 34 of the LRAL)

Japan has signed and ratified both the 1927 Geneva Convention as well as the 1958 New York Convention, making arbitral awards rendered in countries that are signatories to those conventions enforceable in Japanese courts

ER PROCEDURES

A) SUSPENSION: a period, during which the labour contract continues to

be in force, but the worker has no duty to work and the employer is partly or even completely released from paying wages

A worker may be suspended firstly as a form of punishment and secondly while a punishment is decided upon, provided that the worker is prosecuted for a severe crime and the court has not yet decided

Suspension also often occurs, if the employee is on sick leave, becomes a full-time union official or attends full-time training

if the suspension is for reasons attributed to the employer (e.g. temporary lay off), the employer must pay an allowance equal to at least 60% of the worker's average wage (Art. 26 of the LSL)

B) TERMINATION OF EMPLOYMENT Termination of a labour contract at the worker's and the

employer's initiative is governed by Art. 627 of the Civil Code

Notice must be given at least 30 days in advance before the dismissal takes effect (Art. 20 of the LSL )

A dismissal for business reasons is allowed, if it satisfies all of the four requirements set by court:

1. A personnel reduction is based on business necessity2. Every possible measure to avoid layoffs is tried3. The selection of employees to be dismissed is made on an

objective and reasonable basis4. The employer consults faithfully with unions or employees On the employee's request, the employer shall deliver a

certificate stating reasons for dismissal without delay (Art. 22 of the LSL)

EMPLOYEES PARTICIPATION IN MANAGEMENT• Practiced most visibly and formally through the scheme

of joint consultation• System where representatives of both employees

(usually union representatives) and management participate

• Main objective is to share information between workers and management on a relatively broad range of issues relating to corporate management and working conditions

• System is spontaneous, and neither required or prescribed by the law

• Three basic forms of joint consultation system:1. Corporate level worker participation2. Plant level worker participation3. Workshop level worker participation