Japan Press Weekly

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2016 May 11 - 17 [LABOR]

Pay cuts for reemployed workers are illegal: district court

The Tokyo District Court on May 13 ruled that it is illegal for a company to reemploy retired workers with reduced wages and have them do the same work as they used to do.

The plaintiffs in this lawsuit are three truck drivers at a Yokohama-based transport company, Nagasawa-Unyu. They retired at the age of 60 after some 30 years of service, and were reemployed under one-year contracts. Since being reemployed, they have been engaged in the same job with their wages cut by about 30%.

The court ordered the firm to pay the plaintiffs the amount reduced from their wages, noting in the decision that it is “unreasonable” to pay those workers lower wages while assigning them the same task as they performed previously.

Article 20 of the Labor Contract Act bans employers from treating fixed-term employees, including temporary workers, unequally without rational reason. The plaintiffs’ defense counsel said that this is the first court case in which the article was applied to discriminatory treatment of rehired workers.

After the ruling, one of the plaintiffs said, “There are many workers across the country facing similar problems to ours. I hope this judgment will help them solve their problems.”