Abstract
The basic argument in this paper is that while the Japanese economy is under pressure from globalizing markets very similar to that experienced by the United States, the actors' responses to this pressure with relation to employment relations are significantly different. For the U.S. case, I draw on the eloquent description in Prof. Katherine Stone's book, From Widgets to Digits. Pushed by economic and political pressures and pursuing the agenda of "Reform," the Koizumi government introduced a bill to the Diet in 2003 to revise the Labor Standards Law. Opposition parties criticized the bill in the Diet, partly as a result of lobbying from unions. In the end, a compromise was reached. A new clause inserted into the Law stated that, "Employers may not discharge employees without just cause." Legally, this meant that the essence of current dismissal regulations based on case law was incorporated into a statute. The attempt to significantly change dismissal regulations ended up returning to the status quo. To correctly understand the political drama on dismissal regulations in 2003, it is particularly important to investigate in what direction the mainstream business leaders have tried to lead other employers through the channels of various business organizations. I hypothesize that their strategy in employment relations can best be characterized as a 'dualist approach,' keeping core employees as 'lifers' and surrounding them with various types of flexibly employed workers. The strategy called 'Portfolio Employment' was laid out in the well-known white paper titled 'Japanese-style Management in the New Era' published in 1995 by Nikkeiren, the national employer organization, before it merged with Keidanren. The 'Portfolio Employment' strategy envisions the following three groups of workers in a company. 1) Core workers, termed the 'Long-term Competence Accumulation Group' 2) Peripheral workers, termed the 'Flexible Employment Group' 3) In-between workers, termed the 'Professional/Specialist Group' This is a clear expression of the 'Dualist Approach,' which is different from the 'Boundary-less Workplace Approach' in large corporations in the U.S. as described in Prof. Stone's book.
