A bill to amend a part of the Labor Standard Law was passed with partial amendments by the House of Representatives on 5 June, 2003 and then was sent to the House of Councillors. The bill includes three amendments as mainstays: 1) the enactment of dismissal rules; 2) the extension of the maximum period for fixed-term employment contracts to three years from current one year (as for specialists, to five years from current three years); and 3) the relaxation of requirements for the discretionary work system and the de facto working hours system.
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The original bill the government has drafted provides that an employer may dismiss his or her employee unless the right of dismissal is limited by this Law or provisions of other laws; provided, however, that the dismissal shall be invalid by reason of abuse of rights if it lacks an objective and legitimate reason and is considered unacceptable based upon social convention.
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The Committee on Labor Law Legislation created in the Japan Federation of Bar Associations (JFBA) last August examined the government's draft bill and shared the view on the dismissal rules that there needed to be amendments to strike out the body text of the bill as the wording, "may dismiss" could give rise to easy dismissal, and to incorporate the proviso into the body. The JFBA President also issued a statement on this view.
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The labor unions and opposition parties strongly opposed the draft bill, and the JFBA's view drew special attention during the Diet deliberations on this important law reform intended to enact dismissal rules into law. Accordingly, the draft bill was amended to read "a dismissal shall be invalid by reason of abuse of rights if it lacks an objective and legitimate reason and is considered unacceptable based upon social convention." (Article 18, Paragraph 2 of the Labor Standard Law)
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If such dismissal rules are stipulated in the Labor Standard Law, the legal principles governing abuse of the right to dismiss will receive wide publicity and will be utilized in the labor administration and the court operation and management. With regard to fixed-term employment contracts, a supplementary provision granting employees the right to resign after working for a year was incorporated into the Law.
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Yousuke Minaguchi
Member
Committee on Labor Law Legislation
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