Legal Analysis of the Changing Japanese Employment Systems

1994 Fiscal Year Final Research Report Summary

• Project/Area Number: 05451098
• Research Category: Grant-in-Aid for General Scientific Research (B)
• Allocation Type: Single-year Grants
• Research Field: Social law
• Research Institution: The University of Tokyo
• Principal Investigator: SUGENO Kazuo Professor, The University of Tokyo, Faculty of Law, 法学部, 教授 (40009808)
• Co-Investigator(Kenkyū-buntansha): KUROKAWA Michiyo Lecturer, The University of Tokyo, Faculty of Law, 法学部, 専任講師 (80234590) ; ARAKI Takeshi Associate Professor, The University of Tokyo, Faculty of Law, 法学部, 助教授 (60175966)
• Project Period (FY): 1993 – 1994
• Keywords: Japanese model of Employment / Lifetime Employment / Restructuring / modification of working conditions / Labor market

Research Abstract

In the first half of the project, a huge volume of court decisions is analyzed using the data-base which we made. Through the analysis, it becomes clear that the most significant changes in traditional employment system can be found in the process of the restructuring of businesses. Thus, the latter stage of the project was devoted to examine the new development of the legal theory in the process of restructuring.
To clarify in what sense the new trends are emerging, we first examine the content of the traditional legal norm established by case law though comprehensive analysis of a number of precedents. Then several dozens of cases related to redundancies, restructuring of businesses, modification of working conditions in accordance with economic changes were retrieved and were subject to analytical discussions.
Since the case law of the abusive exercise of the right to dismiss strictly restricts dismissals, the management must seek the internal flexibility. Accordingly the case law, such as reasonable modifications of work rules or flexible deployments of workers, has been highly developed to accommodate the necessity to modify working conditions without recourse to discharges. This mirrors the situation of the labor market in Japan.
This project clarifies that the case law and labor market policy have heavily relied on the flexibility in the internal labor market and the function of the external labor market has not been not fully developed. Given the demographic changes, the nature of employees, the position of the Japan's economy in the globalized market, it seems to be required to seek a more balanced flexibility between the internal and external labor market.