THE JAPAN NEWS


 

TOKYO (Jiji Press) — Sadayuki Sakakibara, chairman of the Japan Business Federation (Keidanren), urged member companies on Monday to increase employee pay on an annual basis, including bonuses and allowances, in this year’s shunto spring wage negotiations.

Following the December 2015 suicide of a 24-year-old female employee at advertising giant Dentsu Inc. due to overwork, Sakakibara also asked member businesses to promote work style reform.

“Top management will play a leading role to change Japan’s corporate culture of highly evaluating employees who work long hours,” Sakakibara said in a speech to a two-day management-labor forum organized by
Keidanren, which effectively marked the start of the 2017 shunto talks.

The government of Prime Minister Shinzo Abe has asked businesses to carry out wage hikes for the fourth consecutive year. It has called for pay increases at least matching last year’s growth, with emphasis on pay-scale hikes.

Thanks to steep stock price advances and the yen’s rapid weakening since Donald Trump’s victory in the U.S. presidential election last November, the corporate earnings environment has improved in Japan.

“Backed by this tailwind, the Japanese economy will likely strengthen its recovery moves,” Sakakibara said. “In order to help Japan get out of deflation and realize sustainable economic growth, we must carry forward the momentum of wage hikes,” he added.

Due to downside risks, such as Trump’s protectionist inclinations and an economic slowdown in China, however, Japanese corporate managers have been cautious about pay-scale hikes, which boost fixed costs.

Hard bargaining is expected in the coming shunto negotiations, with the management side looking to reach a settlement based on higher annual wages and the labor side adhering to its pay-scale hike demands.

In this year’s shunto talks, attention will also focus on work style reform, including reducing working hours.

Management and labor plan to discuss cutting prescribed working hours, increasing wages for nonregular workers and devising measures to prevent employees from leaving jobs to provide nursing care for family members.