Japan mulls work-sharing agreements to protect jobs

Japan is working on the draft of a model tri-party work-sharing agreement for promoting Japanese-style work-sharing to prevent job losses in companies that have been compelled to reduce their workforce due to the global economic slowdown.

The concept of the Japanese-style work-sharing is an effort to maintain employment through employee leave, overwork reduction or transfers. The proposed draft also aims to increase subsidies and promote companies that opt for the work-sharing agreement and provide tax incentives for companies that create new jobs in priority sectors. The proposed draft will also promote vocational training and encourage self employment.

The new agreement will be signed by the government, companies and workers representatives.
Japanese Prime Minister Taro Aso, Nippon Keidanren (Japan Business Federation) chairman Fujio Mitarai and JTUC-Rengo (Japan Trade Union Confederation) president Tsuyoshi Takagi are scheduled to meet on 23 March to approve a agreement on promoting Japanese-style work-sharing.

The last such tripartite agreement on diversified work patterns and work-sharing agreement between the government, the Japan Business Federation and the JTUC was signed in March 2002 to maintain and ensure employment.

The main aim, as with the 2002 agreement, is to protect jobs.

Japan's seasonally adjusted unemployment rate soared at its fastest rate in about 42 years at 4.4 per cent in December, reaching its highest joblessness in almost three years as a large number of companies were forced to resort to massive layoffs as their profits took a hit due to deteriorating demand.

As companies are forced to correct their high-cost structure amid the global financial crisis , which has severly hurt Japanese exports and also reduced its growth prospects for 2009 to close to zero, reducing costs by paring production and other measures have led to new projects being shelved.

Japan is heading for worst recession since WW II according to S&P and Japan's key economic data figures are plunging, the unemployment scenario is likely to deteriorate further unless the government and companies come together. (See: Japan is heading for worst recession since WW II: S&P / Japan's key economic data figures plunge)