The head of the union at Nippon Telegraph and Telephone Corp. urged the union Wednesday to ask the company to introduce a performance-based wage system.

Junjiro Tsuda, the head of the union, put forward the proposal in his opening address to a three-day union convention that got under way Wednesday in Yokohama.

If the union approves the proposal, NTT would likely introduce the wage system next April, NTT sources said.

However, those within the union opposed to the system are likely to confront Tsuda and other backers during the course of the convention, the sources said.

Because the NTT union has 208,000 members, the new wage system -- if endorsed -- would likely have an impact on the labor market in the country, they said.

"Would our union members be able to enjoy fairness down the road should they stick to the seniority-based wage system that has revolved around the duration of services, in addition to the working ability of each worker?" Tsuda asked.

On the dispute between the United States and Japan over NTT's interconnection fees, Tsuda said the union has no choice but to accept the July deal obliging NTT to cut the levies.

The accord calls for cutting the charges by 20 percent in the first two years, while modifying the formula in computing the fees in the third year.

"We cannot close our eyes to the sense of crisis among people in many quarters that Japan might end up lagging behind in the information technology revolution," he said. The union appears to be softening its opposition to proposals to alter the conventional wage system amid the rapidly changing business environment in Japan.