Japan Press Weekly

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2020 April 8 - 14 TOP3 [LABOR]

Protect workers from unfair dismissals under coronavirus outbreak

Akahata editorial

With the economic crisis deepening due to the coronavirus outbreak, in a report by the Labor Ministry, as of the end of March, the number of workers who were dismissed or who had their employment contracts terminated exceeded 1,000. After the government declaration of a state of emergency, the employment situation is becoming increasingly serious as shown by the fact that major auto makers announced their layoff plans. The government should take every possible measure to encourage corporations to maintain jobs.

Government stance to refuse to provide loss-of-income benefits creates bottleneck

Workers cannot be blamed for the deterioration of the business environment due to the ongoing health crisis. Corporate job cuts due to the negative impact of the corona outbreak should be conducted carefully in line with the so-called “four requirements for dismissals for downsizing” established by judicial precedents of the Supreme Court: necessity of dismissal, efforts to avoid dismissal, rationality in selecting who is to be dismissed, and having discussions with workers. Staffing agencies should make efforts to protect agency workers from losing their jobs by such means as offering them new places to work. The cancellation of job offers of new graduates are regarded as dismissals. The government should make an announcement without delay that companies should comply with the “four requirements” when cancelling their job offers to new graduates.

In terms of maintaining jobs, what the government plans in its emergency economic package is totally insufficient. Although the Abe government has requested various businesses to suspend their activities, it refuses to compensate them for their losses. Such a stance has created a bottleneck in preventing the COVID-19 spread. To provide direct and indirect financial support covering income losses caused by the government stay-at-home request is vital to sustain employment. Regarding the program to subsidize corporations making efforts to maintain jobs, the government plans to increase the subsidy rate for small- and medium-sized firms to 90%. However, the rate should be raised to 100%

The amount of internal reserves held by large corporations with capital of more than one billion yen has reached a record high of 460 trillion yen. In recent years prior to the coronavirus outbreak, large corporations made the highest-ever level of profits, but turned their back on giving pay raises and have instead accumulated their internal capital reserves by citing economic uncertainty as a pretext. Even under the economic crisis, they cannot justify their move to dismiss workers without making efforts to avoid doing so. The government should require major corporations to fulfill their social responsibility to maintain jobs. Corporate efforts to sustain jobs should be a precondition for receiving government bailout loans. Workers cannot fully cooperate with the government’s stay-at-home request unless their employment is secured.

At the time of the 2008 world economic crisis triggered by the collapse of Lehman Brothers, large corporations and financial institutions conducted massive dismissals while accepting special bailout loans which provoked much public criticism. Automakers, electronics makers, and other large manufacturers terminated their contracts with temporary staffing agencies and fired a large number of temporary workers. The recurrence of such a problem should be prevented.

Many non-regular workers are now facing being forced out of company dormitories due to the termination of their employment contracts. This situation is totally unacceptable as workers are losing both their source of income and places to live amid the coronavirus crisis. The government should waste no time in taking necessary measures to properly deal with this issue. In response to the 2008 financial crisis, the government set up a limited subsidy program to help dismissed workers continue securing places to live and find jobs. The government should reboot this program now so that such workers will be able to conduct job hunting activities without having to move out.

No one should be left behind

The government and business circles have promoted the use of non-regular workers and freelance workers. As a result, two in every five employees in Japan are non-regular workers and it is estimated that more than two million people earn income mainly from freelance work. The government should implement measures to support non-regular and freelance workers and large corporations should fulfill their social responsibility to maintain jobs.