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Thursday, Dec. 25, 2008

Q&A

Temps a threatened species as job cuts bite


Staff writer

Last of two parts

Temporary workers are bearing the brunt of cost-cutting measures taken by businesses, especially in the manufacturing sector, to weather the recession.

In November, the Health, Labor and Welfare Ministry announced that since October, 30,067 temps have either been let go or will be out of work by March. The actual number, however, is certainly much higher, given that subsidiaries of major car manufacturers are not required to report layoffs to the ministry.

Is the government trying to deal with the rampant downsizing? Will the latest amendment of the worker dispatch law improve the conditions of temp workers?

Following are basic questions and answers on the temp situation:

How many temp workers are there in Japan?

According to a 2007 labor ministry survey, 3.21 million people were employed as temps in fiscal 2006, triple the 1.07 million thus employed in fiscal 1999.

What does the worker dispatch law cover and how has it been amended over the past decade or so?

The law sets out the regulations temp staff agencies must abide by in dispatching workers, including the kinds of jobs they can perform, and the length of employment depending on the job.

The law only applied to secretarial and interpreting jobs until 1999, when it was revised to cover almost every field except the manufacturing and medical industries.

This last restriction was dropped when the law was revised again in 2004.

The 2004 amendment also stipulates that an employer must hire a temp worker directly after three years of employment rather than continue to go through a temp agency.

However, Makoto Kawazoe, secretary general of the Tokyo Young Contingent Workers Union, said the amendment fails to guarantee stable employment.

Companies that hire temp workers directly usually do so on short-term contracts that allow them to dismiss workers within a year or so, he said. A revised bill was submitted to the Diet this month to ban contracts of 30 days or less between a temp staff agency and a worker. Under the current system, temp agencies are allowed to offer one-day contracts.

Will this revision improve the working conditions of temp laborers?

Experts say no, pointing out that without a guaranteed income of more than 30 days, workers cannot achieve financial stability. What's more, those with short-term contracts are not eligible for unemployment benefits.

They also point to a loophole that allows temp agencies to continue dispatching workers to different clients on a daily basis, rendering them a disposable workforce.

What problems will temp workers face in the years to come?

One of the biggest is what experts have dubbed "The Year 2009 Problem."

The three-year contracts many temps signed in 2006 will run out next year.

After media reports exposed the unfair hiring practices of such major manufacturers as Panasonic Corp. and Canon Inc., many workers signed three-year contracts in 2006.

Under normal contracting practices, a smaller contractor independently manufactures parts for larger manufacturers. But by disguising the terms of their contracting, major manufacturers were avoiding paying higher salaries and administrative costs by having temps work directly at their facilities.

Although manufacturers are obliged to directly employ temp workers after three years, it is unlikely they will hire them as full-timers to avoid a payroll increase.

The current massive layoffs, however, are taking place even before the contracts run out due to the economic downturn triggered by the global financial crisis.

Is the government taking measures to support laid-off temp workers?

The labor ministry's employment bureau, known as Hello Work, is taking steps to secure housing for temp workers who were forced to leave their dormitories after being laid off or when their contracts ran out.

At an interest rate of about 3 percent, the government will lend up to ¥400,000 for a housing deposit, ¥60,000 a month for rent and ¥150,000 a month for living expenses and the fee for job searches.

Hello Work bureaus will also offer workers reasonable public housing subsidized by the labor ministry. There are 13,266 rooms currently available.

Starting next year, the labor ministry also hopes to shorten the time from one year to six months that workers must pay into the system before they are eligible to receive unemployment benefits.



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