Future Issues of Indefinite Employment Reclassification Rule － Learning from the Precedent in South Korea

Future Issues of Indefinite Employment Reclassification Rule － Learning from the Precedent in South Korea －

生活研究部上席研究員・ヘルスケアリサーチセンター・ジェロントロジー推進室兼任金明中

1――Introduction¹

In both Japan as well as South Korea, the increase in non-regular workers can be observed as a long-term trend. In Japan, the cabinet decided on a plan to continue regulatory relaxation in 1997 that incorporated liberalization of temporary labor, and temporary labor was effectively liberalized in 1999. This spurred the increase of non-regular workers and further diversified the modes of employment available. In South Korea, the number of non-regular workers began increasing after the IMF economic crisis in 1997. For both Japan and South Korea, employment destabilization continues.

In 2007, as the increase in non-regular workers accelerated, the South Korean government implemented the “Act on the Protection of Non-Regular Workers.” The purpose of the law known was as “In acknowledgement of the diversification of the labor marketplace, to limit the time period of fixed-term and part-time worker employment in order to restrict abuse of irregular employees and rectify unreasonable discrimination against irregular employees.” The result was that employees who worked at the same workplace for more than two years would be treated as contractual employees for an indefinite contractual period.

In this paper we discuss the current status of non-regular workers in Japan and South Korea in addition to both countries’ governmental stance on this issue is referred. First, based on several studies conducted in both countries, we contrast and analyze the different definitions of “non-regular workers” used in Japan and South Korea. Then we explore measures to address non-regular workers in both countries. In particular, by analyzing the issues surrounding the implementation of South Korea’s “Act on the Protection of Non-Regular Workers,” which introduced the indefinite employment reclassification rule not yet seen in Japan, we seek to discuss what kind of indefinite employment reclassification rule Japan should pursue in the future.

¹ Myoung-Jung KIM: Associate Research Fellow, Social Improvement & Life Design Research Department, Healthcare Research Center, Gerontorogy Promotion Office NLI Research Institute, Tokyo, Japan.
Machiko Osawa: Professor, Japan Women's University, Tokyo, Japan.

2――Definition of non-regular employee in Japan and South Korea

The definition of non-regular employee is one of the important factor when we compare the actual condition of them cross-nationally. The actual condition, however, is not totally same even if the name is same because structure of the labor market, form and scale of the development and industrial relationship vary depending on each country. Also, non-regular employee has not been defined apparently not yet. But, Japan and South Korea define it in some ways to grasp the actual condition, so next, we will discuss further on them.

(1) Definition of non-regular employee in Japan
Initially, Japanese survey distinguishes non-employee by means of “contract period of labor (hereinafter called a position at work)” and “internal name at work (hereinafter called employment system)” Based on a position at work, “a temporary employee” who is employed with contract with fixed term between a month and a year and “daily employee” employed with contract with fixed term less than a month are regarded as non-regular employee. Meanwhile, “internal name at work” based divides it into seven parts depending on the name at the work such as regular employee, part-time worker, casual staff, dispatched employee, contracted employee, fixed-term employee and others, and treats the six parts except regular employee as non-regular employee and staff.

However, the difference of the definitions affects big gap of regular employee rates. In 2017, a rate of non-regular employee based on the position at work is 7.1 % which is far below that based on the employment system, 37.3%. It can be said that changes of Labor force survey`s agenda caused significant decrease in a rate of non-regular employee based on the position at work (13.8%-8.5% 2012-2013).

Labor force survey newly divides a position of work into “permanent work (an indefinite contract)” and “permanent work (a definite contract)”, therefore, it can be explained that the respondents who answered “a temporary employee” as far answered “permanent work (a definite contract)” in the new survey and, it reduced the number of “a temporary employee” and it increased permanent work (a definite contract) at the same time.

Although a rate of non-regular employee based on a position at work had not changed dramatically from 80’s to 90’s, it increased to up to 14% after then, however, it has been decreasing since 2013. On the other hand, a rate of non-regular employee based on employment system has been increasing since 80’s even now. Kambayashi (2013) focuses on the difference of time-series trend of increase in non-regular employee and says that the difference of the definition of non-regular employee is not only problems of statistic measurement and academic sentences but key issues which is intimately connected with the role played by non-regular employee in labor market.

Figure1 Trend of ratio of non-regular employment by two definitions in Japan's labor force survey

Osawa and Kim (2010) state that all workers other than regular employee are generally non-regular employee. That is, regular employee includes (1)full-time, (2)name called regular employee or permanent employee,(3)indefinite term, (4)contractual labor and (5)direct employed by the company. Non-regular employee, on the other hand, lacks any factor of them.

(2) Definition of non-regular employee in South Korea
In South Korea, the argument how to define non-regular employee among government, labor union and researchers still underway. The tripartite committee convening a committee called “The special committee for non-regular employee” in July 2002 because of an intensifying dispute over the concept and range of non-regular employee after IMF economic crisis, and they finally came to an agreement on classification standard based on employment system. This agreement expanded the extent of non-regular employee to include contingent employees and temporary workers which is based on sustainability of labor, part-time workers based on labor time and atypical worker such as dispatched workers, subcontract workers, specially hired service providers and Family workers.

However, a ratio of non-regular employment which is announced by researchers still has a big gap despite the integration of concept of non-regular employment due to the standard established by the special committee for non-regular employment. Although both the government and labor union are tally based on “The Economically Active Population Survey” conducted by Korea National Statistical Office. However why the rate differs?

For one of the reason, government statistics define non-regular employment as those who contracts with fixed-term based on (1)contract term (indefinite or definite), (2)labor time a day (full-time or part-time), (3)relationship of contract (direct hire, indirect hire or a sole proprietor), works with short-time, contracts with more than three people and works as dispatched workers、specially hired service providers、and family workers. In contrast, statistics of labor union include regular contingent and regular daily workers distinguished by The Economically Active Population Survey adding to non-regular employment defined by government statistics.

Government statistics calculate regular workers as workers excluding non-regular workers. But, the labor union treats both workers without social insurance and workers with less sustainability of their workplace (regular temporary workers and regular day employees in Table 1) as non-regular workers.

Table1. Estimated classification that regular temporary and day workers are non-regular workers

Figure 2 shows the trend of the ratio of non-regular employee in South Korea from 2001 to 2017. The reason why it shows 2 data is because the rates announced by government statistics and labor union are different. As at August 2017, government statistics say the rate of non-regular employment is 32.9% while labor union does 42.2%. Although the gap between them is narrowing, it still varies by 9.5 %.

Kim Yusun (2008) states that “long-term temporary workers” who has got anxiety of their job like a risk that they can be fired and termination of their contract even if they have already been working more than a year and they expect that they can work more than a year, constitute a vital portion of non-regular employment in South Korea. According to Table 2, the number of non-regular employee reached 3 million and 414 thousand in August July, so the rate by labor union goes below that by government statistics when we recalculate by adding this fugue by labor union`s estimate to regular employee that lessen the rate of non-regular employee from 42.4% to 25.2%.

Figure2　Trend of ratio of non-regular workers by government and labor union in Korea

Table 2 Estimated results prescribing long-term temporary workers as non-regular workers (Korea、2017.08 )

Although there is not integrated standard of non-regular employee`s concept internationally, OECD recognizes “Temporary workers” which is based on generally time limit of employment for international comparison. Korea National Statistical Office estimates that Short-term Contract Employee, Dispatched worker, Daily worker are qualified for “Temporary workers” and submits relative data of them to OECD every August. Figure 3 shows trend the ratio of temporary workers in major members of OECD. The rate in South Korea as of 2014 was 21.6% which is the highest standard among OECD countries while that in Japan has been decreasing since 2005 continually.

Figure 3 The ratio of temporary workers in major members of OECD

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日付

タイトル

執筆者

媒体

2025/03/18

グリーン車から考える日本の格差－より多くの人が快適さを享受できる社会へ－

金明中

研究員の眼

2025/03/17

「共に民主党」の李在明代表の大統領の夢はどうなるのか？－尹錫悦大統領の釈放で政局は不透明な状況へと突入－

金明中

研究員の眼