The ruling coalition plans to oblige staffing agencies to disclose their commissions and call on client companies to take responsibility for covering temp workers’ compensation insurance, according to a draft plan aimed at reforming the labor dispatch system.
The plan by the Liberal Democratic Party and New Komeito, revealed Wednesday, also seeks to address the practice of dispatching workers only to group companies.
The plan is set to be finalized at a meeting Tuesday of the ruling parties employment measures task force, which will ask the Health, Labor and Welfare Minister Yoichi Masuzoe to revise the Temporary Staffing Services Law, sources said.
The Health, Labor and Welfare Ministry is then expected to submit a bill to revise the law to an extraordinary Diet session, likely to be convened in the autumn.
The draft revision plan stipulates measures aimed at achieving three goals:
— Stabilizing employment and ensuring better working conditions for temp workers.
— Making labor dispatch businesses fairer.
— Tackling illegal dispatch practices.
Staffing agencies receive a payment from their client companies for dispatching workers and pay temp workers this amount minus expenses, social insurance fees and commission, among other costs. However, many of the agencies have not disclosed their cut.
This has drawn criticism, with some people suspecting the staffing agencies have exploited temp workers and are getting them to work for lower wages.
In light of this, the ruling parties have included in the draft plan a measure calling for the disclosure of information, including dispatch firms’ cuts, the sources said. By revealing how much commission the staffing agencies take, the ruling parties hope the margins will be adjusted to more appropriate levels, and dispatched workers can use the disclosed information when they select staffing agencies they want to register with.
Regarding the practice of outsourcing workers only to group companies, the draft plan calls for appropriate regulations, such as introducing a cap on the number of workers that staffing agencies are allowed to send to group companies.
The ruling parties say in the draft plan that such practices can adversely affect the treatment of workers.
The draft plan also calls for a measure that would force companies using temp workers to share legal responsibility for them with dispatch agencies, a move the lawmakers believe would help reduce the number of work-related accidents.
Under the current law, even though dispatched workers are involved in accidents at work, client companies are not required to share the costs of workers’ compensation insurance for temp workers.
