While Japan has seen an increase in the number of non-regular workers (part-time, fixed-term or dispatched workers), the terms and conditions of employment have traditionally been inferior to those offered to regular employees. Japan has recently amended the Act on Improvement of Employment Management for Part Time and Fixed Term Workers and established the Act on Improvement of Employment Management for Part Time and Fixed Term workers. These measures are aimed at ensuring that non-regular workers are treated no less favourably than regular workers with substantially similar employment circumstances.
Non regular and regular employees who have substantially similar employment responsibilities must be treated equally in their employment.
Employers must extend to non-regular employees welfare treatments offered to regular employees where it would be unreasonable not to do so (based on the circumstances outlined below).
The circumstances of employment to take into consideration when determining whether it is unreasonable to distinguish between a non-regular and regular employee include: the duties of the employee, the extent of any changes in the job content and workplaces, job positions, experience, worker abilities and responsibilities.
Employers must provide reasons to non-regular workers for any disparity in employment treatment where requested.
The amendments seek to promote the “equal work, equal pay” principle by equalising the treatment of workers who have substantially similar job duties, positions, experience, abilities and responsibilities where distinguishing between non regular and regular worker’s treatment and conditions is unreasonable based on the circumstances of their employment.
The amendments clarify that when considering the employment treatment and conditions of regular and non-regular workers who have substantially similar employment circumstances, employers cannot prescribe differences in base salary, bonus or other treatments such that there is an unreasonable difference between the two types of workers. Factors such as the worker’s job duties and weight of responsibility attached to those duties should be considered in deciding whether the employment conditions are substantially similar. The amendments also stipulate that these conditions should be reviewed across all the employer’s workplaces, and not with reference to only a single workplace. Access to the employer’s welfare facilities (e.g. company cafeteria, resting room, locker room, etc.), must be extended to both regular and non-regular employees alike.
Employers will be required to provide reasons to non-regular workers for any disparity in employment treatment, and outline the matters contemplated and taken into consideration when permitting the disparate employment treatment. A worker cannot be dismissed for having requested such reasons.
Employers should review the employment terms and conditions offered to non-regular workers against those offered to regular employees and ensure that any disparity is promptly addressed. There is an increased focus in Japan in ensuring that those workers who do not have the status of permanent employees are, nonetheless, treated fairly in the workplace.