Japan Press Weekly

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2008 January 30 - February 5 [LABOR]

Company ordered to compensate workers for gender discrimination

The Tokyo High Court on January 31 overturned a lower court decision and ordered Kanematsu Corp., a general trading company, to pay in compensation a total of 72.5 million yen to four out of six plaintiffs who claim that they have suffered gender-based wage discrimination.

Pointing out that the women workers were performing their jobs as well as their male colleagues, the judge stated, “Since there was no rational reason for such significant wage differences between men and women employees, the company discriminated its employees on the grounds of gender,” thus having violated the Labor Standards Law which stipulates the equal pay for men and women.

After the Equal Employment Law for Men and Women was enacted in 1985, Kanematsu introduced a personnel management system with two career tracks, the “general position track” and the “clerical position track.”

Employees taking the “general position track” were required to transfer across the country but were recommended for promotion; employees taking the “clerical position track” would stay in the same office but were not promoted.

The “general position track” was offered to men, and the “clerical position track” was offered to women. As a result, female employees received less than half the wages on average of male employees just before the males were promoted to managerial positions.

At a rally after the ruling was handed down, plaintiffs’ lawyer Nakano Asami said, “The court recognized that it is illegal for employers to use differences in the form of labor contracts to create wage gaps between men and women assigned to the same jobs. This will have a great impact on those who are working as part-timers and other forms of employment.”

Japanese companies widely introduced the “career track personnel management system” in order to cover up issues of gender discrimination.