New labour reforms may prove deadly

TOKYO: Japan’s lower house approved controversial labour reforms yesterday that the government has defended as necessary to boost the economy but critics warn could result in more death by overwork.

The legislation would scrap hourly overtime pay for some employees while setting overtime caps for others for the first time.

The government says the measures will boost efficiency and equality, and they form a key plank of Prime Minister Shinzo Abe’s “Abenomics” policy to kickstart the country’s sluggish economy.

But critics argue that loosening hourly overtime pay will only encourage overwork in a country that is infamous for the phenomenon of “karoshi”, or death by overwork, and some opposition members booed loudly as the bill was approved.

The legislation must still pass the upper house, though local media said approval there was likely.

The reform’s key feature is letting Japan’s corporate sector hire select, highly paid professionals, such as currency traders and consultants, on contracts which include no overtime pay.

The category only applies to those who earn at least 10.75 million yen (US$97,800) annually, with employers required to seek the consent of professionals involved.

Financial analysts and stockbrokers are expected to be among the likely targets of the new contracts, while professionals like doctors whose case load can vary by the hour will be exempt.

The law contains the first legal caps on overtime, setting an annual limit of 360 hours for normal cases, and up to 720 hours for “temporary” and “special” cases.

It also promotes flexible work schedules, allows office workers to develop side businesses, and urges equal pay for workers on different contracts doing the same job.

Mr Abe’s government says the reforms are necessary due to an ageing and shrinking population.