Labour, management should jointly promote work style reform, wage hikes

EFFORTS must be made in pursuit of increased productivity through work style reforms to sustain the current momentum for wage hikes in the future as well.

All major corporations have made offers in response to demands by their employees in annual spring wage hike negotiations between labour and management, known as shunto, for 2017. Many decided to implement pay- scale increases, or an increase in their basic wage levels.

The size of wage hikes demanded by labour at such companies as automobile and electrical firms was RM120 monthly, equal to last year’s level. In response, Toyota Motor Corp. and Nissan Motor Co. offered to raise their basic monthly wages by Â¥ 1,300 and Â¥ 1,500, respectively. Some other companies, including Hitachi, Ltd., offered an increase of Â¥ 1,000.

Kansei shunto - the government’s practice of taking the initiative in demanding high-level wage increases - has entered its fourth year. Although this served to maintain a continued increase in wage levels every year, the amount of pay hikes for this year falls below last year’s level.

Meanwhile, this year’s shunto is marked by the spread of efforts to promote work style reforms through labour-management cooperation.

As a benefit in addition to its basic wage hikes, Toyota said it would pay family allowances covering employees who are currently raising their children. This is aimed at reducing the burden imposed on their family finances by child-rearing costs, while also securing a number of women ready to work for the car maker.

NEC Corp. has said it will improve and expand its “interval system” designed to secure a certain length of time between the time workers leave the office and the next time they come to work.

The government has set out to rectify the practice of working long hours, and the Japan Business Federation ( Keidanren) and the Japanese Trade Union Confederation ( Rengo) have agreed to set an upper limit on the number of overtime hours. There was effectively no ceiling on overtime work in the past.

It is significant that, in response to the trend of work style reforms, labour and management will not only work to raise wages but reconsider their employment practices.

If efforts are made to facilitate a pleasant working environment in which people’s appetite for work and their capabilities are bolstered, improved productivity can be expected. That will heighten the earning power of corporations and generate funds for further pay increases.

We hope business administrators will shed their inward-looking deflationary mind- set, and adopt an even more positive business strategy.

Supported by such favourable winds as the depreciation of the yen that started last autumn, corporations are expected to secure a solid settlement of accounts ending in March 2017. — WP-Bloomberg