Labor reform approved in Japan

 While in Brazil the Law 13,467/17 completes 8 months in force, the labor reform in Japan was finally approved last June 29 (Friday). Defended by Prime Minister Shinzo Abe since 2016, the then bill that promised to be a "Revolution in the Way People Work" is one of the main pillars of the structural reform planned by the current government to increase the country's productivity.

 With the strong support of the Federation of Economic Organizations (Keidanren), the labor reform consisted of three main changes: (a) determining a legal limit for overtime, hitherto unpredicted in the Japanese legal system; (b) guarantee the payment of equal salary for equal work for regular and irregular workers; and (c) determine the non-application of labor regulations to highly qualified and high-paid professionals, since it is understood that remunerating these professionals for the results they present, rather than the hours worked, will allow greater flexibility in working style.

 Currently, labor legislation limits daily work period of 8 hours and 40 hours a week, with the possibility of unlimited overtime through the execution of a labor union agreement. With the entry into force of the labor reform, as a rule, overtime will be limited to 45 hours per week and 360 hours per year, but exceptionally, it will be possible for the monthly work hours to be extended to 100 hours and the annual work hours up to 720 hours. It has been criticized by the opposition, since such a limit would be much higher than the 80-hour limit laid down by the Ministry of Labor as a parameter for setting excessive work.

 Regarding to the establishment of equal pay for equal work, the legislator intended to resolve the differentiation of remuneration between regular and irregular workers, once the non-regular workers earn on average 60% of the remuneration of regular workers. To this end, the work experience and capacity, performance and results, and time in employment will be adopted as criteria for applying the same remuneration to employees.

 The opposition party and labor law experts have also criticized the labor reform regarding the exemption from overtime pay to highly skilled workers who are paid more than 10.75 million yen per year. According to them, this would lower the cost to companies and further increase the number of cases of karoshi (death by labor exhaustion) in the country.

 According to Abe, the new legislation aims to enable new work styles, including allowing employees a better balance between personal and professional life. With the reduction of the workforce, the purpose is for companies to invest more in technology with the introduction of artificial intelligence and robots, to implement flexible working days and to improve internal procedures for greater efficiency and corporate productivity.