A labor union for firms in the metal and machinery industries has agreed to accept a work-sharing system in which basic daily pay would be reduced by up to 5 percent for each hour cut from a day's work, union officials said.
The decision Friday by the Japanese Association of Metal, Machinery, and Manufacturing Workers marks the first time an industrial union has clarified the specifics of a work-sharing model.
Kiyoshi Sasamori, head of the Japanese Trade Union Confederation (Rengo), has so far been tolerant of lower annual salaries on condition they are due to shorter hours. Under JAM's proposal, companies will be able to reduce employees' working hours by up to two hours a day, cutting basic daily salaries by up to 10 percent. The system is aimed at preventing drastic drops in pay and is intended only as an emergency measure to enable companies to maintain employment amid the recession.
JAM has set three years as the maximum life span of the system. It will ask companies to sign an agreement stipulating that during the period, management will not offer early retirement programs or cut jobs.
It has proposed measures such as having employees put in up to 10 hours, rather than the usual eight, before overtime would kick in, to facilitate adoption of the program.
Of the roughly 2,300 unions comprising JAM, around 400 have been asked by their firms to accept restructuring programs such as pay cuts and temporary shutdowns.