Japan clears plan to encourage foreign workers to stay longer

TOKYO: Japan’s cabinet approved on Friday bills to reform the foreign trainee programme as the aging country seeks to encourage foreign workers to stay longer through a new system focused on developing skills and protecting rights, according to a Kyodo News report.

Likely to start in 2027, the new programme would allow trainees to switch workplaces in the same industry on certain conditions and gain skills needed for transitioning to a system that opens a path to permanent residency.

“We aspire for foreign talent to work in Japan for a long time and advance their skills, and it is crucial to prevent human rights abuses,” Justice Minister Ryuji Koizumi said at a press conference following a Cabinet meeting. “These bills play an important role in realising an inclusive society.”

The new programme clearly outlines its goal as “nurturing and securing foreign talent” and allows foreign workers to move to different workplaces in the same business area as long as they have worked in one place for more than a year and have a certain level of work skills and Japanese language proficiency.

However, amid worries that many workers may move to cities from the countryside for beter pay, the programme would allow the government to require workers to stay for up to two years in certain industries.

Supervising organisations, which act as brokers and monitor companies that accept foreign trainees, will be renamed “supervisory support organisations” and required to appoint external auditors under the new system.

The programme aims to nurture trainees’ skills in three years to a level where they can shit to the specified skilled worker system, introduced in 2019, that allows for stays of up to 5 years with the potential for obtaining permanent residency.

The planned legal revision also includes revoking permanent residency status from foreigners if they do not pay taxes or social insurance premiums.

In a separate development, Japan’s biggest companies agreed to raise wages by 5.28% for 2024, the hetiest pay hikes in 33 years, the country’s largest union group said on Friday, reinforcing views that the county’s central bank will soon shit away from a decade-long stimulus programme. The much-stronger-than-expected increase comes as the Bank of Japan (BOJ) looks close to ending eight years of negative interest rate policy. BOJ officials have stressed the timing of a pivot would depend on the outcome of this year’s annual wage negotiations.

Policymakers hope that big pay rises will boost household spending and produce more durable growth in the broader economy, which narrowly avoided slipping into recession late last year.