The Japanese government is considering introducing legislation concerning the so-called "equal pay for equal work" rule for the purpose of improving the working conditions of non-regular employees. As part of this process, on December 20, 2016, the draft guidelines for equal pay for equal work ("Draft Guidelines") were issued by the Council for the Realization of Work Style Reform held at the Prime Minister's Office.
The Draft Guidelines provide interpretations as to which differences in working conditions between regular employees and non-regular employees are considered reasonable and which differences are considered unreasonable. For typical situations, the Draft Guidelines contain two sets of specific examples: situations where there are no legal issues and situations that do have legal issues. For instance, the examples of situations with no legal issues include a case in which a company pays bonuses to regular employees who are responsible for meeting production efficiency or quality targets but subjects them to penalties if they fail to achieve those targets, while the company does not pay bonuses to non-regular employees on whom the company does not impose such commitments or penalties. On the other hand, an example of a situation that would involve legal issues is a case in which a company pays bonuses to all regular employees irrespective of their duties or contributions, while the company does not pay bonuses to non-regular employees.
Although the Draft Guidelines are currently no more than a "draft," it is expected that going forward, the drafting of the amendment to the law will be based on the Draft Guidelines; in other words, the content of the Draft Guidelines will likely be incorporated into a bill. Accordingly, companies that employ both regular employees and non-regular employees should begin to consider whether or not there are any unreasonable differences in working conditions between those categories of employees in light of the Draft Guidelines and should begin to investigate how to eliminate any such unreasonable differences that do exist.