SNA (Tokyo) — Many commentators portrayed Article 8 of the Part Time and Fixed Term Employment Act as the point at which Japan finally recognized the principle of same work-same pay for regular and irregular workers. But one word threatens to undo its promise–“unreasonable.”

The Part Time and Fixed Term Employment Act, effectuated in April 2020 for regular firms and for small businesses a year later, prohibits unreasonable treatment of employees on regular and irregular or contingent contracts.

Article 8 stipulates, “The employer must not create a disparity that could be deemed unreasonable between the base pay, bonus, and other conditions of short-term or fixed-term employees and ordinary employees, with due consideration to what could be deemed appropriate in light of the nature and purpose of the compensation as well as the details of the operations the worker is involved, the degree of corresponding responsibility, the details of the work duties, the potential for job changes of the two groups of employees and other circumstances.”

Disparities between contingent and regular employees are thus forbidden if they are “unreasonable.” Does that mean “reasonable” disparities are fine? Let’s see what the courts are up to on this front, looking at three verdicts over the past few years.

The sole point of contention in the Osaka Medical University (now Osaka Medical and Pharmaceutical University) case was bonus payment. A part-time secretary sued the university claiming that not receiving a bonus represented an unreasonable disparity with the regular employees who did receive them. The Supreme Court found for the university, concluding that not paying the bonus to the secretary was not unreasonable in light of the nature and purpose of the bonus, the more difficult work duties of the regular employees, and the greater potential for job or position changes. The university used the bonus to attract people who could handle regular employment, which was deemed much more difficult than the secretary’s part-time gig.

A subsidiarity of Tokyo Metro–Metro Commerce–runs the subway kiosks. Four women who work there with fixed-term contracts sued, contending that the company’s refusal to pay the same severance which they pay to regular staffers was an illegitimate disparity. Again the court concluded the disparity was legitimate. Whereas regular employees must make up missed days, have early and late shifts, and must handle multiple kiosks, the contract employees only have to handle kiosk sales.

Contract workers at Japan Post who did the same jobs as regular employees sued over discrepancies in the payment of allowances and other conditions. The Supreme Court, however, concluded that it was reasonable to create some disparities. The contract workers had only to do a specific job with no expectation for promotion and an evaluation system that is different from regular employees. The regular workers endured more job or position changes, justifying some disparities, the court ruled.

However, the Supreme Court also knocked down some disparities as unreasonable: first, it found that allowances for workers with dependents and allowances for housing should be treated evenhandedly; next, it saw no justification for not paying non-regular employees the same year-end work allowance when the post office is exceptionally busy; and, finally, the court saw no reason for disparities regarding summer and winter breaks, public holiday pay, and paid sick leave.

In these three cases, workers are one for three.

Courts seem reluctant to shoot down bonuses, severance pay, and most large financial benefits. The post office case shows they are willing to reject refusal to grant leave and smaller allowances of lesser impact.

Verdicts of this nature might restrain companies from feeling free to treat contingent workers any way they like, but they will also teach employers to be careful to mark out clear differences between the two groups of workers in terms of work duties and job or position changes, thus giving them legal grounds to perpetuate the same inequities as before.

Contingent workers now make up almost 40% of all workers in Japan, and these verdicts do little to solve the overarching problem of collapsing job security and conditions for the Japanese people

The new law stipulates that base pay, bonuses, and other conditions cannot have unreasonable disparities, but this may only motivate corporate leaders to create “reasons” to maintain the status quo.

Former Prime Minister Shinzo Abe rolled out the same work-same pay principle as a key part of his vaunted “workplace reform.” In a 2018 speech, he declared, “Finally, the time has come to realize same work-same pay, which has been debated for so many years. By prohibiting unreasonable disparities based on employment type, we will sweep the term hiseiki (irregular employment) from the nation.”

It’s important to note that he did not say, “Let’s eliminate irregular employment” or “Let’s eliminate disparities between regular and irregular employment.” He seems to have only meant that the term hiseiki should no longer be used.

From 2012 to 2016, while the “success” of Abenomics was being trumpeted in the media on a daily basis, the number of workers on irregular contracts rose by 2.07 million while the number of regular workers grew by only 220,000. This means that 90% of new jobs created were irregular.

This suggests that, in reality, the economic position of Japanese workers has been steadily declining.

The workers of Japan must come together and express their outrage at how politicians appear to have swindled them again.

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