Message from the President Oct.2008

a monthly magazine for our employee Oct.2008

Concerning the Revision of the Worker Dispatch Law
- Toward True Industry Improvement -

As already reported in newspapers and other media, last July 28 a report from The Ministry of Health, Labour and Welfare’s “Worker Dispatch Law Research Group” was released. Moving forward, based on the contents of this report, the Ministry of Health, Labour and Welfare has established the Labour Policy Council, where a debate is taking place on the revision of the Worker Dispatch Law.

The original impetus for the establishment of the Worker Dispatch Law Research Group was the increased societal demand for the review of temporary staffing itself, stemming from an increase in legal violations such as unfair day-labor cost exploitation and illegal staffing among certain staffing companies and fraudulent outsourcing. Simultaneously, some point out that the day-labor system causes labor instability and social inequality due to low wages, with a growing trend toward a review of the system due to these societal pressures.

As a result of this chain of events, the report includes a proposal for a ban on day labor, which has been singled out and emphasized in numerous reports by newspapers and other media due to the high level of societal interest surrounding this issue. However in actuality, suggestions made by Meitec and the Nippon Engineering Outsourcing Association, of which Meitec is a member, have also been well reflected in the report. Specifically, the following two points have been clearly proposed:

1) A clear legal distinction should be made between regular-employment style temporary staffing and registered style temporary staffing
2) As a result, the Article 40 of the Worker Dispatch Law, which states that the companies who accepted the temporary worker must offer a permanent job to the temporary worker who had worked at the particular job for specific length of period, is unsuited to regular-employment style temporary staffing.

In that respect, our firm believes the report should be supported to some extent in that the contents are not completely driven by societal trends. In particular, within the current legal system, a distinction is made between specific temporary staffing businesses and general temporary staffing businesses, and we believe that, to reflect the employment reality facing workers, the argument favoring the review of the distinction between regular-employment style temporary staffing (indefinite employment) and registered style temporary staffing should be widely supported. Furthermore, concerning Article 40 of the Worker Dispatch Law, the original objective of the law was “to provide an opportunity for stable hiring of temporary workers (registered style temporary staffing) facing unstable employment.” For companies such as ours who have claimed that this is unsuited to the already stable regular-employment style temporary staffing and have implemented the above objective since the establishment of the law, the validity of our claim has finally been publicly recognized. As a result, our firm will continue to be active in making sure that the societal validity of our position connects to future legal revisions.

The report also touches on regulatory strengthening for the elimination of malicious businesses. The ratio of so-called irregular employees, including temporary employees (registered), part-time employees and contracted employees as of 2007 is more than 33%, making up one third of the Japanese labor market. Until around 15 years ago, this number was closer to 20%, with irregular employment now rapidly increasing. This reality is the result of a large trend toward companies seeking to heighten their ability to respond to changes in the market environment through the utilization of flexible hiring, but with any rapid increase comes “strain” and “distortion.” This is why the market has become rife with malicious business within the worker dispatching and outsourcing industry, with some businesses ignoring the basic rights of workers and even fail to pay social security premiums. In that respect, the construction of a system for the elimination of malicious business is absolutely essential, but debate is divided over whether it should be legally regulated. I believe that in a sound, free-market society, malicious businesses are not only legally regulated, but should also be identified by customers and workers and naturally die out. It is from this belief that our company is involved with the Nippon Engineering Outsourcing Association in working for “good money driving out bad money for the improvement of the industry.”

In any case, the overly negative image of the staffing model reflects the reality of our current society, and the heightened societal interest in staffing presents an opportunity for industry improvement. While our company must accept a portion of the effects of this societal headwind, we must not miss the current opportunity to place every effort into building an even sounder industry.

October, 2008