Labor Policy Keiichiro HAMAGUCHI
Chapter 2 Working Conditions Policy
Section 3 Wage Policy
(evolution of wage system) • Seniority-based wage system in wartime and right after the war • Job-based wage system advocated in 1950s and 1960s • Skill-based wage system prevalent until 1980s • Performance-based wage system advocated recently
(1) Minimum Wage System • ILO Convention No.26 on Minimum Wage adopted in 1928 required involvement of social partners. • 1939 Wage Control Order fixed maximum wage rate. • 1940 revised WCO fixed minimum wage rate.
(a) Pseudo Minimum Wage System • 1947 Labor Standards Law provided on minimum wage, but not implemented. • Ministry of Labor tried to fix them in 4 sectors, but failed in 1950. • MoL promoted pseudo minimum wage rate agreed among employers (not among social partners). • 1959 Minimum Wage Law provided two types: collective agreement type and employers agreement type (pseudo minimum wage).
(b) Proper Minimum Wage System • 1968 revised MWL abolished the pseudo type and established minimum wage fixed by tripartite Council. • Regional minimum wage fixed in each prefecture. • Sectoral minimum wage fixed for specific sectors. • Sectoral minimum wage lost criminal effect in 2007 revision. • Minimum wage level is very low (36% of the average wage). • 2007 revision required consideration on public assistance payment level/
(2) Minimum Wage for Industrial Homeworkers • 1959 Minimum Wage Law provided minimum homework wage (conditional on fixed minimum wage), but no such wage fixed. • Industrial accidents by homeworkers pushed the fixing in 1966. • 1970 Industrial Homework Law established minimum homework wage fixed by Homework Council. • ILO Convention No.177 on Home Work adopted in 1996.
(3) Payment of Unpaid Wages • Unpaid wage cases after oil crisis • 1976 Security of Wage Payment Law obliged employers to preserve savings. • Payment service of unpaid wages by government include not only bankruptcy but also other insolvency.