The Prime Minister Shinzo Abe administration's plan to stiffen restrictions on overtime is far from sufficient.
The government's efforts to reform working styles in Japan are aimed at achieving a better work-life balance. Policymakers should return to this starting point to launch discussions on fundamental reform.
The Labor Standards Act limits work hours to eight hours a day and 40 hours a week in principle. However, up to 45 hours of overtime are permitted under the law if there is a labor-management agreement. Moreover, employers can require their employees to do unlimited overtime work as an exceptional measure. Long work hours are rampant at many companies in Japan, cutting deeply into time spent with family, and critics have pointed out that this is one factor in the country's low birthrate.
Against this backdrop, the government began efforts to reform the way people work. Moreover, the overwork-induced suicide of an employee of Dentsu Inc., an advertising giant, sparked criticism of long hours on the job at Japanese companies, prompting the government to stiffen legal regulations on work hours.
Under the government's plan, the upper limit on overtime would be legally set at 45 hours a month. Furthermore, employers would be banned from forcing their employees to do more than 720 hours a year (60 hours a month on average) of overtime, even if there is an exceptional measures agreement between labor and management.
Officials considered setting the upper limit at an average of 80 hours a month over a two-month period, or setting the upper limit at 100 hours during busy periods. These proposals were based on the standards by which labor authorities recognize deaths of workers as work-related accidents. Under these standards, employee deaths are recognized as due to overwork in cases where the deceased spent more than 100 extra hours on the job in the month before developing fatal brain or heart conditions; or in cases where the deceased's monthly overtime topped an average of 80 hours over a two- to six-month period.
However, there are numerous workers who suffer from brain or heart ailments because of overwork even though their illnesses are not recognized as work-related. It is out of the question for the government to set overtime restrictions that brush right up against the standards for recognizing overwork deaths.
Many businesses face staff shortfalls, while many employees cannot cover their living expenses without overtime pay. The government has apparently drawn up the restrictions to be realistic for both employers and employees.
However, European countries -- where work hours are far shorter than in Japan -- have legislation that strictly limits overtime and guarantees long vacations for staff. The situation in Japan, where employees are forced to work long hours, is abnormal in light of international standards.
Moreover, there are numerous loopholes in the current overtime restrictions. There are no restrictions on overtime for those in managerial positions or those in the farming and fisheries industries. Truck drivers and researchers are also effectively outside the restrictions framework. Designers and other specialists are subject to the discretionary work system under which they receive fixed overtime allowances based on labor-management agreements. It is only natural that the government is considering setting restrictions on overtime in these job categories.
At the same time, a bill to amend the Labor Standards Act to allow employers to introduce a merit-based pay system for their employees without overtime allowances has also been submitted to the Diet. Even though the government emphasizes that only some specialist jobs are subject to this wage system, the planned legal revisions to that end are inconsistent with the government's efforts to set restrictions on overtime.
The government should enforce restrictions without loopholes.