With the revised Equal-pay-for-equal-work Guidelines (hereinafter, “the Guidelines”) to be implemented on October 1, companies need to ensure their payments are in line with the new rules. This article explains the background of the revision and looks at key points of the new Guidelines.
[1] Background of the revision
As five years have passed since the equal-pay-for-equal-work rules were applied to all businesses, discussions for revising the Guidelines began in February 2025. After the current rules were imposed, there have been multiple Supreme Court decisions over unreasonable pay gap between regular and non-regular employees. The new Guidelines have been drawn up by incorporating such instances.
[2] Key points of the revised Guidelines
The Guidelines have been revised in 9 areas, including items with more detailed descriptions and new additions.
- Bonuses (more detailed descriptions)
- Retirement allowance (new)
- No-accident allowance (new)
- Family allowance (new)
- Housing allowance (new)
- Welfare facilities (more detailed descriptions)
- Sick leave (more detailed descriptions)
- Summer and winter holidays (new)
- Rewards (new)
Among the newly added items, the Guidelines set rules on retirement allowance, home allowance and summer and winter holidays as below.
◆Retirement allowance
Retirement allowances are paid for various purposes, such as deferred payment in exchange for labor performed or merit rewards. However, there are cases where part-timers or fixed-term workers are not paid retirement allowances, even if the payment will meet the purposes. Failure to pay appropriate amounts of retirement allowance to part-timers or fixed-term workers, in accordance with their duties compared with those of regular employees, may be considered unreasonable treatment.
◆Housing allowance
In the case a company pays housing allowance for a transfer that requires the employee to change residence, the payment must be made equally to part-timers or fixed-term workers under the same condition.
◆Summer and winter holidays
Companies must give summer and winter holidays equally to part-timers, fixed-term workers and regular employees.
[3] Key points of the revision
There were past court decisions acknowledging a difference in the treatment of regular employees and part-timers or fixed-term workers as reasonable, from the perspective of the need of companies to secure regular employees. The revised Guidelines, however, state that the difference in the treatment due solely to the need of securing regular employees shall not be considered naturally reasonable. The Guidelines say whether disproportionate treatment is unreasonable should be determined based on the nature or purposes of the treatment.
Companies are advised to check if their employees’ working conditions comply with the revised Guidelines. If any support is needed in reviewing the current situation or fixing problems, please contact us.
■Reference
The Ministry of Health, Labour and Welfare, “Special website for equal-pay-for-equal-work rules”
https://www.mhlw.go.jp/stf/seisakunitsuite/bunya/0000144972.html
*This information is based on laws and regulations as of the date of the original article.
