Japan Press Weekly

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2009 March 18 - 24 [LABOR]

Major companies offer zero wage increase in annual wage talks

In response to union demands for wage increases, major auto and electronics makers, including Toyota and Hitachi, on March 18 offered no wage increases for the first time in four years as well as drastic cuts in bonuses from the previous year.

The Japan Council of Metal Workers’ Unions (IMF-JC), a federation of unions at major manufacturers, said that some companies agreed to keep an annual pay raise, but electronics companies such as Hitachi and Toshiba say they will freeze even regular salaries after labor and management reach an agreement.

Large corporations are reluctant to use even a small part of their internal reserves to increase workers’ wages, thus neglecting to fulfill their corporate social responsibility by addressing the urgent need to address the issue of widespread poverty and revitalize the economy through expanding domestic demand.

Auto companies, including Toyota, rejected the workers’ demand for a 4,000 yen increase in their monthly salaries.

All electronics companies also offered zero wage increases in response to the unions’ demand for a 4,500 yen increase.

At workplaces of Nissan Motor Co., after wage negotiation results were posted on the wall at lunch time, a 50-year-old worker said, “If the company is cutting bonuses on the grounds that they are linked to business performance, the company should respond to our demand for a pay raise because that is not linked to business performance.”

At a workplace of Toshiba Corp., a 50-year-old worker complained, “For many years, the company has made huge profits and gave us minimal pay raises. It is unreasonable for the company to offer a zero pay raise because of some losses.”