Yen for Living

The rise of non-regular employment has received a lot of coverage because of its effect on job security in the general work force. A seldom discussed side effect is the acute anxiety experienced by non-regulars as their contracts approach their expiration dates. Will mine be picked up for another year? Will I have to go out and look for a new job next month?

Hello Work website

For public non-regular employees this emotional roller coaster starts right after Jan. 1, since most contracts end with the fiscal year in March. And for those who have been working in the same position for an extended length of time, there is no solace in the new law that goes into effect this year and which says an employer must hire a contract worker as a regular full-time employee, complete with benefits, if the worker has been in the same position for five years.

Though it’s assumed that many employers will work the loophole by not renewing a contract just before the five-year period is reached and then hiring the person back after a six month “cooling off” period with an open-ended contract, non-regulars who work in the public sector aren’t covered by the new law in the first place. They can be retained as non-regulars indefinitely.

This exception was highlighted when the labor ministry announced that 2,200 non-regular members of its unemployment advisory staff had not had their contracts renewed for fiscal 2013. That represents 10 percent of all the non-regulars employed at Hello Work counseling centers nationwide, and presents an interesting scenario: Former employment counselors who themselves must seek employment advice.

In fact, a Tokyo Shimbun article described one woman in her 50s who received her notice in early March while she still had several weeks on her contract. Though she knew there was always the possibility her yearly contract would not be renewed the lateness of the notice (the media reported the announcement as being “sudden”) caught her off-guard.

In the last weeks of March she was looking for a new job at Hello Work on Saturdays while still working Monday through Friday at the same facility counseling people who themselves were looking for jobs.

One part of the new law that was already in effect before April 1 is to make the practice called yatoidome illegal. “Yatoidome” means nonrenewal of an employment contract for “no good reason,” but, of course, “good reason” constitutes a gray area that the Japanese legal system isn’t equipped to address. It is this part of the law that doesn’t apply to public workers, supposedly because non-regular government employees are only hired as stopgap workers, meaning people employed to fill certain positions on a temporary basis. They do not have to pass a test the way full-time regular civil servants do. However, in many cases, these workers become as indispensable as regular employees. In 2012, 63 percent of all Hello Work employees were non-regulars.

As for why the labor ministry decided to effectively lay off so many employment center staff at one time, a representative told the media that the ministry hired extra contract workers when the recession worsened in 2008 and again after the disaster of 2011, but now the job situation “is stabilizing” so the ministry doesn’t need as many counselors. Some laid-off employees counter this explanation by claiming that their workloads have been heavier in recent months, not lighter, especially in areas most affected by the disaster. What may have sparked the layoffs was the finance ministry, which has been auditing budgets across all government agencies and ministries and demanding cuts.

The yatoidome exception doesn’t just apply to national public workers. One-third of all local government employees, or about 700,000 people, are also non-regulars. That’s an increase of about 100,000 since 2008, according to a labor ministry survey. Of these, 60 percent work more hours than regular employees. More than half of these non-regulars make less than ¥160,000 a month or ¥2 million a year. And because they are technically part-timers, they are not up for promotions or salary increases. The most prevalent jobs in this category of public worker is day care attendant and librarian, but it also includes policemen, firemen and school teachers.

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Here's your money: Bank of Japan

As the fiscal year draws to a close the relevant government ministries and agencies release their statistics for the previous calendar year. This week, the media mostly concentrated on a survey by the Bank of Japan that revealed a steep rise in the percentage of households (two or more people) with absolutely no financial assets, meaning no stocks, bonds, savings or annuities: 28.6 percent, 6.3 points higher than it was in 2010 and the highest it has ever been since 1963, when the BOJ started conducting this particular survey. Among the households that did have financial assets, the average amount per household was ¥11.5 million, or ¥190,000 less than in 2010. The reason cited by the BOJ is a loss of value in securities affected by market performance in response to the March 11 disaster and the European credit crisis. However, one aspect of the survey that tends to get overlooked in most news reports is that 8,000 questionnaires were sent out but only 47.5 percent were returned with responses, which means the number of households represented was less than 4,000.

For a bit more insight into the nation’s economic well-being, there’s the chingin kozo kihon tokei chosa, a survey conducted by the Health, Welfare and Labor Ministry to find out the situation with regards to salaries and wages. According to the results the average monthly pay of a full-time worker in Japan in 2011 was ¥296,800, which was 0.2 percent less than it was in 2010. Yearly salaries have been going down since 2008, when the average was ¥299,980. This amount includes basic wage plus any regular allowances but does not include overtime or bonuses. The ministry received responses from 45,818 firms, each of which has at least ten employees. Broken down a bit further, the average yearly pay for men was ¥328,300 (about the same as it was in 2010) and for women it was ¥231,900. That’s about 70 percent of men’s pay, but ten years ago women’s average pay was 60 percent of men’s.

Continue reading about yearly economic statistics →

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Enough to make you sick: monthly Kokuho payment schedule

According to an article in the Aug. 29 Asahi Shimbun, the number of asset seizures initiated by local governments in an attempt to recoup delinquent national health insurance payments has increased startlingly in the past four years. Asahi asked the pertinent sections of all 23 wards in Tokyo, as well as those in 19 major cities about seizures. They received responses from 37 local governments in all, and the data indicates that between fiscal 2006 and fiscal 2010, the number of delinquent payments that led to actual seizures of assets increased by almost sixfold.

In this case, we’re talking about Kokumin Kenko Hoken, or National Health Insurance, which is paid by anyone who is not a member of the Shakai Kenko Hoken system, which is paid for by contributions from employers. Traditionally, National Health Insurance, known as Kokuho for short, was carried by people who are self-employed. And that’s still true. However, the ranks of Kokuho carriers has increased greatly over the past two decades as the employment situation has changed. With more people out of work and even more changing over from so-called lifetime employment to so-called non-regular employment, the number of people who are compelled to pay into the Kokuho system gets larger and larger. Kokuho is administered by local governments, and national insurance, whether paid for by the individual or by his/her employer, is mandatory in Japan. If the individual is too poor to pay the premiums, he or she should go to the local government office and tell an official. The only real way to get out of the system and still have insurance is to qualify for welfare. Other than that, in principle everyone has to pay. Some local governments have a system wherein someone who has not paid because of financial difficulties but needs medical care can pay the full amount of that care up front and receive at least partial reimbursement later, but those are exceptional cases.

Continue reading about health-insurance crackdowns →

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Got a job

The frontline of Japan’s privatization steamroller is the post office. Junichiro Koizumi staked his political career on removing Japan Post from government control when he made his bid for reelection in 2005 and won by a landslide. However, Shizuka Kamei, the leader of the small Kokumin Shinto party who recently resigned as financial services minister, has staked his own political career on reversing the privatization of Japan Post owing to loyalties within the post-office community. Before quitting he asked Japan Post to offer more regular full-time positions to its non-regular workforce.

Kamei’s target was 100,000 employees, but last week JP announced that about 65,000 of its non-regular staff were actually qualified to take the test to become regular full-time employees, and among them only 34,000 said they would apply for the test by the July 28 deadline. Since these non-regular workers already toil full-time for all intents and purposes, there seemed to be some confusion about why more wouldn’t want to take the test. One of the main reasons, according to the Asahi Shimbun, is that some of them fear they would be eligible for transfers to other cities if they become regular employees.

Otherwise, the decision seems a no-brainer. Regular JP workers make on average three times as much as non-regular JP workers for the same number of hours worked and the same job description, and, of course, non-regular employees are not eligible for advancement and raises, and do not receive benefits, like sick pay. One non-regular employee interviewed by Asahi said he’s been working at JP as a sorter for 14 years. He works three 12-hour shifts a week and receives ¥2.3 million a year before taxes.

This individual wanted to take the test to get regular employment, but at first he couldn’t. The initial criteria for switching to regular employment was that the non-regular employee had to have worked for JP at least 30 years, be less than 60 years old, and is currently working at least 30 hours a week. In practice, the employee fit all three criteria, but in theory he missed out on the last one. His employment contract stated that he was only hired to work 27.5 hours a week, even though he always worked overtime thus putting his hours in excess of 30. But overtime didn’t count. Apparently, quite a few non-regular workers who have the same problem expressed it to their superiors, and before Kamei left his post he changed the criteria to 20 hours a week minimum.

All these potential new regular employees would cost JP an extra ¥100 billion a year. Since going private, the company has shifted to part-time and non-regular workers — it only hires about 2,000 regular employees a year — and the shift back would be expensive. Japan Post now has 210,000 non-regular employees, about half its workforce, making it the country’s single biggest employer of non-regular workers.

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