How are Japanese people working at Japanese companies laid off?

It is said that there is no layoff in Japan, but in the midst of financial difficulties or the corona crisis, employees may be laid off. However, the way Layoff is done in Japan is a little different from the other countries.

In case of US/Western countries

In the case of Layoff, mainly in US/Western countries, it is common to implement a PIP (Performance Improvement Program) for low-performing people, watch the progress, and then Layoff.

Labor law and customs are not so strict, so Layoff will be done with a notice at a certain time.

In case of Japan

It is rare for Japanese companies in Japan to implement a PIP (Performance Improvement Program), and the reality is that even if they have low performance, they cannot easily lay off.

It's not easy to lay off low-performing people even when the business is healthy. You can lay off when your business is healthy only when you are out of compliance. For example, if you embezzle company money or commit a crime, you can lay off.

Next, let's talk about when the business becomes unhealthy, so-called business difficulties.

When it comes to financial difficulties, there is still a pre-stage for doing something like PIP.

In Japan, you cannot proceed with dismissal unless you meet the "four requirements for dismissal".

整理解雇の4要件とは――裁判の判例とともにわかりやすく解説 - 『日本の人事部』 (jinjibu.jp)

Dismissal to reduce the number of employees due to circumstances on the employer side such as poor management or business reduction is called "rational employment", and in principle, four requirements established from past labor precedents (1. Necessity of personnel reduction 2. Fulfillment of obligation to avoid dismissal 3. Rationality of selection of employees 4. Appropriateness of dismissal procedure) must be satisfied.

日本の人事部

Especially the second item is important "Did company make an effort to avoid dismissal? "

Therefore, Japanese companies usually have to cut expenses, ban overtime, etc. before the dismissal begins. If this happens, you need to be prepared to start dismissal.

The target is often over 45 years old and in managerial positions

Even if the above conditions are met, Layoff targets are often 45 years old or older and managers.

In Japan, the power of the labor union is still strong, so it is difficult to do layoff for general employees other than managers.

45歳リストラ時代に　成功体験捨て未経験の職に挑め｜NIKKEI STYLE

First of all, it is common to have an interview with all the people who meet the above conditions. At this time, your boss or HR department will have a list of people you want to quit to some extent. Here, there may be words that encourage retirement. This is called "肩たたき　shoulder tapping" in Japan.

You may be able to provide some incentives for retirement. However, by nature, excessive retirement negotiation are against the law. Ultimately, if you don't want to retire, you're not obliged to do so.

Recently, the monitoring of the Labor Bureau has become much stricter, but in the past, it became a social problem that the company gathered employees who wanted to lay off in one room and forced them to change jobs.　Many people called this a 追い出し部屋　banished room.

However, even so, it is a Japanese labor practice that you do not have to quit if you stick to the intention of "not wanting to leave."

The flexibility of dismissal in Japan is still low, and it can be said that the protection of workers is very high.