Observation (CEACR) - adopted 2012, published 102nd ILC session (2013)

Minimum Wage Fixing Convention, 1970 (No. 131) - Japan (Ratification: 1971)

Articles 3 and 4 of the Convention. Minimum wage system. The Committee notes the comments of the National Confederation of Trade Unions (ZENROREN), dated 25 September 2011, and the Government’s reply concerning the application of the Convention. According to ZENRONEN, the implementation of the minimum wage legislation raises four issues: (i) low level of minimum wage rates; (ii) unfair method of calculation of the minimum wage; (iii) widening gaps among prefectural minimum wage rates; and (iv) discrimination against ZENROREN representatives in minimum wage councils.

Regarding the first point, ZENROREN considers that, contrary to the requirements of Article 3 of the Convention and section 9 of the Minimum Wages Act, both of which require that the cost of living be taken into account when setting minimum wage rates, the current rates are fixed at levels insufficient to cover the needs of a worker, and even less so the needs of his or her family. What is more, minimum pay rates are often below the amount paid under the social aid programme (or livelihood assistance). For instance, while the minimum monthly wage is fixed at ¥111,183 in Tokyo and ¥85,679 in Kochi, the amounts paid under the social aid programme are ¥141,680 in Tokyo and ¥112,056 in Kochi respectively.

In its reply, the Government indicates that, in fact, minimum pay rates in nine prefectures were found to be below the social aid allowance but measures were taken to raise the minimum wage in six of them while efforts are now being made for the readjustment of the minimum wage in the remaining three prefectures.

With respect to the second point, ZENROREN maintains that the Government uses various methods to misrepresent minimum wage levels as compared to social aid standards. For instance, the Government uses the figure of 178.8 as being the average number of hours of work per month, which is unduly long and clearly exceeds average working hours, including overtime, of full-time workers in all industries.

In its reply, the Government states that the current method of comparing minimum wage levels and social aid benefits as well as the reference number of monthly working hours, have been adopted through sincere discussions by the Central Minimum Wages Council which brings together persons representing the general interest and workers’ and employers’ representatives.

As regards the third point raised in ZENROREN’s comments, it is alleged that the gaps among the minimum wage rates applicable in different prefectures have been widening since the revision of the Minimum Wages Act in 2007, which introduced the consideration of cost of living and general wage level by prefecture. For instance, the minimum pay rate applicable in Tokyo is 23 per cent higher than that of Okinawa. ZENROREN also indicates that it has conducted a survey showing that the cost of living was practically the same in the prefectures of Saitama, Iwate, Shizuoka and Nagasaki, and there was therefore no reason for establishing different minimum pay rates. Moreover, ZENROREN claims that regional minimum wage gaps have a serious impact on employment in rural areas as young workers increasingly migrate to big cities in the search of higher pay. ZENROREN considers that there is no justification for a relatively small country to have 47 different minimum wages and therefore calls for the adoption of a single, generally applicable minimum wage rate.

In its reply, the Government indicates that regional differences exist in the cost of living and the ability of enterprises to pay wages, and therefore it is only natural to determine wage rates according to the actual conditions of the respective regions. The Government adds that the role of the Central Minimum Wages Council is to set a rough estimate of the revised minimum wage rate in order to facilitate discussions and maintain consistency at the prefectural level.

Finally, ZENROREN alleges that it has been systematically excluded from the composition of the central and 47 prefectural minimum wage councils. It indicates that contrary to the appointment of employers’ representatives where members are selected from three main employers’ associations, on the workers’ side, only members supported by the Japan Trade Union Confederation (JTUC–RENGO) and its affiliates have been appointed so far.

In its reply, the Government merely indicates that workers’ representatives are appointed in accordance with the procedures set out in section 23 of the Minimum Wages Act and section 3 of the Minimum Wages Councils Order.

While noting the Government’s explanations, the Committee would appreciate receiving additional information with regard to: (i) measures taken or envisaged aimed to ensure that minimum pay rates are higher than the amount of the livelihood assistance; (ii) any official report or research study addressing in greater detail the advantages and disadvantages of maintaining a system of separate minimum wage rates by prefecture; and (iii) any consideration given to the possibility of appointing workers’ members to minimum wages councils from different trade union confederations in the interest of amplifying the representativeness of the councils.

In addition, the Committee raises other points in a request addressed directly to the Government.