Work style reform legislation gets Cabinet approval

April 6, 2018

Tokyo- Work style reform legislation, a top priority for Japanese Prime Minister Shinzo Abe's administration, got cabinet approval Friday, after a delay due to controversy over data flaws in a related labor ministry survey.

The legislation, designed to revise the labor standards law and seven other acts, mainly feature the establishment of a system to exempt highly-skilled professionals from work hour regulations, which opposition parties claim as possibly leading to more overwork deaths.

The new system is expected to cover specialist workers, such as researchers and consultants, who earn 10.75 million yen or more annually.

Workers under the system will be allowed to work flexibly without being bound by prefixed work hours. But they will not be paid overtime, late-night or holiday work allowances. Their employers will be obliged to secure at least 104 holidays a year and at least four days off per four weeks for them.

Outside the system, the legislation calls for stipulating overtime ceilings of 100 hours a month and 720 hours a year in the labor standards law, together with penalties for violations, following a spate of recent overwork-related deaths including suicides.

The current law has no definite overtime limit, meaning in theory that employers can make employees work overtime indefinitely if there are management-labor agreements.

To prevent overwork deaths, companies will also be required to have employees take paid holidays and cooperate in promoting systems to secure certain intervals between the end and start of daily work.

The legislation will also call on employers to take steps under the principle of equal pay for equal work, with the view to reducing pay gaps between regular and nonregular employees.

Many measures in the legislation will be implemented in April 2019. But the overtime limits will start for small businesses in April 2020, and the equal-pay-for-equal-work system for large companies also in April 2020 and smaller firms in April 2021.

Initially, the government planned to adopt the work style reform legislation at a cabinet meeting in February this year, including an expansion of the discretionary work system to apply fixed-overtime terms to certain jobs.

Due to the labor data scandal, however, the government was forced to postpone the cabinet approval and give up including the discretionary work expansion in the legislation. Jiji Press