Legal change will make temp purgatory permanent for many Japanese workers

Eight years ago, a TV drama about temporary workers generated a great deal of excitement around Japan. In “Haken no Hinkaku” (“Dignity of a Temp”), model-actress-singer Ryoko Shinohara played Haruko Omae, a “super-temp” who masterfully tackled the myriad troubles that arose in her ¥3,000-an-hour job. Unshakable, aloof and playing by her own rules, she performed better than any of the regular employees, refused all overtime and off-the-clock socialization, and shunned flattery and fake smiles to boot.

Unfortunately, the drama did not reflect reality. In real life, critics said, such a temp worker (haken shain) would have been fired on the spot, and regardless of skill level, temp workers tend to be seen as outsiders and are treated worse than regular workers.

On Wednesday, recent revisions to the Worker Dispatch Law go into effect. There was chaotic debate in the Diet over this bill, just as there was with the security bills, but in the end the ruling coalition dealt with it in the same way as it has other unpopular measures: by pushing it through with their majority in both chambers.

Let’s look at the details of the changes.

1) Switch to open-ended dispatch

This is what stands out the most in this amendment. Until now, the use of dispatch workers in most industries (all but 26 types of jobs, which were judged to require specific professional skills or knowledge) was limited to three years.

That limit has been lifted for all industries and job types, and a new limit of three years has been introduced that applies to specific dispatch workers. What this means is that a dispatch agency can use worker A for up to three years, but then the agency has to dispatch a different worker if it wants to continue supplying workers to the same company. (The agency can continue, however, to use worker A in a different department at the client company.)

However, this three-year limit can be rolled over and reset for another three years if the dispatch agency “asks the opinion” of either a majority labor union or a representative of the majority of employees. That’s right: All management needs do is to “ask the opinion” of a worker’s rep, rendering the three-year limit meaningless. (In fact, my editor assumed I must have meant “ask the opinion and gain consent from” the rep. Afraid not.)

Academics and other critics warn that the new legal framework will trap workers into a dispatch relationship for their entire working lives (known as shōgai haken, meaning “lifelong dispatch”).

2) Promotion of equal treatment

The national government surely expected that there would be strong opposition to the changes from labor (i.e., unions, labor scholars and labor-side attorneys). So, to address such concerns, they squeezed in some regulations ostensibly to ensure equal treatment between temp workers and the direct-hire employees at the company they are sent to.

The new rules say that if a temp worker asks their dispatch agency for equal treatment on par with regular workers at the client firm, the agency’s management must explain to the worker in detail what actions it took in this regard. Refusal to do so could result in the canceling of the dispatch license and other severe penalties.

Before the amendment, the corporate client had an “obligation to make an effort” to disclose data about the wages it pays its direct employees to the dispatch agency. In effect, “make an effort” (doryoku gimu) is legal jargon for “not really required.” The amendment makes this wage disclosure mandatory. Client firms are also now obliged to train dispatch workers whenever relevant training is provided to direct hires, and to provide them with the same level of access to welfare facilities (fukurikōsei shisetsu — meaning dorms, cafeterias, recreational facilities used by employees, etc.) that company employees enjoy.

Some could argue that the rights of temp workers have been strengthened by these changes, but it is unclear how — and how strictly — these rules will be enforced.

3) Measures to stabilize employment

In another step to address the problems raised by section 1), dispatch agencies are now obliged to take measures to “stabilize employment.” Specifically, they must try to do the following “in order” (meaning that if the agency fails at 1, they must try 2; if they fail at 2, they must try 3; and so on):

a) Ask the corporate client to hire the worker directly;

b) Provide a new corporate client to work at (after the three-year period concludes);

c) Recognize open-ended employment at the dispatcher (meaning they do not get booted from the agency at the end of their dispatch period); and

d) Other measures required to provide continuous, stable employment.

Critics have blasted this half-hearted, stopgap measure as hopeless, saying it will not lead to job security. For instance, a) requires temp agencies simply to “ask” the corporate client, and the client is free to say no.

Prior to this amendment, the corporate client was obliged to offer a direct hire position to the temp if the company had used the temp agency for the same work (in one of 26 specialist categories) for more than three years (Article 40, paragraph 5 of the Worker Dispatch Law). So at least there was a chance of direct hire for those workers. The latest change has watered down that article even further.

4) All industries using temps must apply

Before the recent amendment, only certain types of jobs required government authorization to use dispatch contracts. The amendment does away with such distinctions and requires all industries to apply. Bringing government reach to dispatch work should be welcomed.

Although I have discussed the highlights of the amendment, I’m sure some readers are still a bit bewildered by this convoluted system. Part of the reason for this confusion may be because the dispatch system itself is an extremely unnatural working relationship.

The Worker Dispatch Law stipulates that “Worker dispatch entails having one’s own employee working under one’s own employ but under the work orders of a different entity. It does not include any promise that the worker will be employed by the other entity” (Article 2, Section 1). So, what ordinarily is a bilateral working relationship between worker and employer becomes a three-way process with a complicated mix of rights and obligations.

So why complicate things this way? The simple answer is that the temp worker is a means of maximizing profit for both the dispatch and client companies. Under this set-up, the worker — who is already in a very weak socioeconomic position vis a vis the employer — is put in an even more precarious position.

This is precisely why dispatch work was prohibited until 1985 under Article 6 of the Labor Standards Act, which says, “No person shall obtain profit by intervening, as a business, in the employment of others.” Yet dispatch-like relationships gradually increased until a wave of such work changed the face of Japanese industry, resulting in the 1985 enactment of the Dispatch Worker Law as an exception to Article 6 of the Labor Standards Act. Subsequent revisions have deregulated dispatch work step by step, until we arrive at what we have today: near-unfettered freedom of dispatch.

Whereas direct-hire workers are hired after face-to-face interviews and make a living with a modicum of security that allows them to build lasting personal relationships at work, dispatch workers are likely to be treated more like machines, tools or other objects. As evidence for this, dispatch contracts are premised on the need for skill or knowledge regardless of the worker’s personality or character. This is why the Worker Dispatch Law forbids pre-placement interviews with the actual temps by the corporate client. The client also cannot state which candidate they want sent from the dispatcher.

Yet the reality is that the workplace is where human beings come together. In any environment, it’s impossible to treat other human beings as merely things or tools. So, instead of interviews, clients hold “workplace tours” and “orientations” as a way to get to know the temps that might be working for them. In “Haken no Hinkaku,” Omae worked hard to treat herself like an object and shut down her human side. That effort itself is emblematic of how dispatch work is unstable, precarious and conducive to aggressive exploitation.

To sum up, although the amendments are a mixed bag of the good and bad, one thing is clear: Industry will be able to use temps like never before. At the center of the temp industry is Pasona Group Inc. and its chairman, Heizo Takenaka, a champion of deregulation since the government of Prime Minister Junichiro Koizumi and a member of the Industrial Competitiveness Council, an advisory committee to the current government. The amendment reads like a wish list of measures that will benefit dispatch companies and their clients. A cynic might even suggest that Takenaka drew up these ideas in the council, pushed Prime Minister Shinzo Abe to ram them through the Diet, and that he now stands to benefit substantially from the end result.

The history of how this bill came to be law offers a clear lesson in industry’s influence over government, in stark contrast to the almost total disregard for the plight of temp workers, who could now find themselves trapped for life in a state of temporary employment and permanent insecurity.

Hifumi Okunuki teaches at Sagami Women’s University and serves as executive president of Tozen Union. She can be reached at Labor Pains appears in print on the fourth Monday Community Page of the month. Originally published in The Japan Times.