Court again rules Isuzu’s layoff of contingent workers as illegal

Japan Press Weekly

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Court again rules Isuzu's layoff of contingent workers as illegal

The Utsunomiya District Court on October 20 ruled that the wage cut for three former employees at Isuzu Motors Limited's Tochigi Factory in Ohira Town, Tochigi Prefecture, was illegal.

The three workers, who had worked at the factory on fixed-term contracts, were dismissed in March 2008 by Isuzu, a truck maker capitalized at 40.6 billion yen.

The plaintiffs are members of the All Japan Metal and Information Machinery Workers' Union (JMIU)'s Isuzu branch, including union chair Matsumoto Hirotoshi.

The ruling was in response to Isuzu Motors' appeal against the court ruling last May that Isuz's labor practice as illegal.

On December 26, 2008, Isuzu announced that it will dismiss 1,400 workers, including part-time and fixed-time contract workers, although their terms of employment were still in force. Facing public protest after the announcement, Isuzu had to withdraw the announcement. However, it began encouraging voluntary early retirement and announced that wages for those who are reluctant to accept offers and are laid-off will be cut by 60 percent.

In the decision, the court stated that under the Labor Contract Act that in principle prohibits employers from dismissing contingent workers on short notice, any attempt to dismiss them requires good reason. Also, Isuzu's financial situation shows little ground for cutting their wages, it added.

In his victory comment, Matsumoto stated, "Isuzu's conduct was again ruled as illegal. The car maker can no longer continue dismissing workers, who had been working as disguised contractors. Isuzu must sincerely accept the decision and take steps to employ them as regular workers."

- Akahata, October 21, 2009