▲ Office workers in Tokyo, Japan (The photo above is unrelated to the content of the article.)
The practice of uniformly cutting wages for elderly workers rehired after retirement has faced regulatory curbs in Japan.
This is due to the reinforcement of the "equal pay for equal work" guidelines, which prohibit unreasonable treatment disparities between regular and non-regular workers.
According to the Nihon Keizai Shimbun on October 1, the Japanese government is strictly enforcing the revised "equal pay for equal work" guidelines starting today to eliminate unreasonable gaps between non-regular and regular workers.
The revised guidelines require a comprehensive assessment to determine whether treatment differences between regular workers and older workers rehired on a fixed-term or contract basis after retirement align with the nature and purpose of salaries and allowances.
It explicitly specifies that lowering wages simply because a worker is on a fixed-term contract is unfair.
Consequently, companies now bear the obligation to provide a rational explanation when reducing wages upon rehiring.
According to a 2023 survey by the Japan Institute for Labour Policy and Training, a research institution affiliated with the Japanese government, 95% of rehired workers past retirement age are on fixed-term contracts, and 80% saw their salaries decrease despite performing the same duties.
Legal disputes stemming from this issue have also continued.
Driving school instructors in Nagoya, Aichi Prefecture, filed a lawsuit after their basic wages were cut by more than half following their rehiring in 2016.
While lower courts ruled that the excessive pay cut was unjust, the Supreme Court remanded the case in 2023, stating that the nature of the salaries needed to be examined in detail.
However, the remand trial last February ruled in favor of the workers once again.
Hotta Yohei, an attorney at TMI Associates, stated, "Measures that uniformly cut wages without rational explanation, even when the job duties remain the same as before rehiring, must be avoided."
(Photo: Yonhap News)
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