• Spring Labor-Management Wage Dialogues
• Working Style Reform
• Views on the G20 Finance Ministers and Central Bank Governors Meeting
  and the B7 Rome Summit

Spring Labor-Management Wage Dialogues

Judging from reports of settlements reached to date, many companies have agreed to implement pay scale increases. In respect of bonuses and one-off payments, reports also indicate either full acceptance of union demands or higher settlements than last year. A notable feature of this year's talks has been incorporation of working style reform into labor-management dialogues, and this is leading to improvement of working conditions. Although people tend to focus solely on the amount of pay scale increases, the important point is that pay scales have been increased for four consecutive years. The cumulative effect over these four years is quite large, and I expect it to boost consumption. Above all, SMEs, which have concerns about securing staff amid personnel shortages, have awarded wage increases at relatively high levels in the face of uncertain prospects. Overall, I welcome the momentum for wage increases maintained by this year's spring labor-management wage dialogues, which accords with Keidanren's call for higher wage increases than last year in terms of annual incomes. I hope that this trend will continue to spread.

Working Style Reform

The agreement on upper overtime limits recently reached by government, labor, and management is among the most significant reforms to have taken place in the 70-year history of the Labor Standards Act. Although the agreement was made between Keidanren and the Japanese Trade Union Confederation (RENGO), the Japan Chamber of Commerce and Industry and the National Federation of Small Business Associations also collaborated in the negotiation process. However, these groups do not represent all business organizations and trade unions, and the circumstances of enterprises and organizations not belonging to Keidanren and RENGO must be taken into consideration in dealing with upper overtime limits.

The recent government-labor-management agreement provides a framework for reform, which will be incorporated into law in due course. Previously, labor and management simply had to reach a "36 Agreement" to remove any ceiling on overtime, but this will now change. As a rule, the upper limit on overtime will be 45 hours a month or 360 hours a year, with an upper limit of 100 hours a month allowed in exceptional circumstances, and regulations will include penalty provisions. Large companies will need to make considerable efforts to comply with these stipulations, and compliance will be even harder for SMEs. Everyone accepts the need for working style reform, and will have to work through the finer details to see what provisions are required in reality. Although our approach must not be slipshod, we cannot spend too much time on preparations. Working style reform is a key priority for the Abe administration, and Keidanren is committed to swiftly achieving such reform.

Views on the G20 Finance Ministers and Central Bank Governors Meeting and the B7 Rome Summit

Although I would certainly have preferred the joint communiqué to mention the importance of combating protectionism and promoting free trade, omission of such matters does not negate their significance. As indicated by the declaration that "We are working to strengthen the contribution of trade to our economies," it is essential to confront protectionism and encourage free trade. The communiqué also included important references to promoting inclusiveness and fairness and reducing inequality.

Business groups from G7 member countries and regions will hold a B7 summit in Rome on March 31. A joint declaration is currently being discussed at the administrative level, and I would like to advocate curbing the rise of protectionism and maintaining and promoting free trade. The other member countries have their own stances on these matters, but the Japanese business community intends to send a strong message on the importance of maintaining free and open international economic systems.