- Today, three bills designed to revive crippled corporations, including the
Industrial Revitalisation Corporation Bill, cleared the Diet at the Plenary of
the House of Councillors, by a majority supported by three ruling parties and
the Democratic Party of Japan (DPJ).
- The Industrial Revitalisation Corporation (IRC) Law is 5-years temporary
legislation to revive debt-laden companies. It provides that the IRC will select
companies it believes can be turned around after receiving restructuring plans
signed by both debtor companies and their main banks, buy their bad debts from
their banks, support them as they follow an IRC's restructuring plan and sell
debts to new sponsors.
As emphasised employment stability and labour-management consultation as a precondition
for restructuring, Rengo called the Government to incorporate these two concerns
into the bill. Following the consultation between the ruling parties and the DPJ,
the bill was revised three aspects: employment stabilities is included in objectives
of the IRC; the situation of labour-management consultation is taken into consideration
when deciding if the IRC is to support a company; and, any company is not removed
from the support because of its size. Furthermore, the law is accompanied with
seven supplementary resolutions, including one requesting the Industrial Revitalisation
Council to reflect views of trade unions into their decisions about selecting
companies to be supported.
Rengo highly evaluates these revisions with supplementary resolutions.
- The Industrial Revitalisation revision bill includes a provision that tax
and other favourable treatments to be given to companies in the process of restructuring,
as well as one for the establishment of a committee supporting restructuring of
small and medium-sized enterprises (SME).
Rengo demanded for labour-management consultation that is now referred in the
guidelines to be stipulated in the Law, as well as other revisions aimed at improving
legislation to protect workers in the events of transfers of undertakings or businesses
and strengthening authority of a SME Restructuring Committee. Thanks to efforts
of the DPJ and other opposition parties, these demands were successfully actualised
in the adoption of resolutions on "the safeguarding of employees" and
"workers' claims to be considered as a safety net for workers".
The Industrial Revitalisation Law will further facilitate the divisions and transfers
of businesses and, therefore, legislation to protect workers should be improved
so that employment responsibilities are taken over and a priority is given to
a worker's claim.
- Rengo will keep its eyes on the IRC, particularly if it ensures that restructuring
processes are transparent and legitimate on the basis of labour-management consultation,
without any burden on the people. In addition, Rengo will demands that prior labour-management
consultation be done to promote job stability and sustainability in the events
of transfers of businesses and improve legislative workers' protection in the
event of mergers and acquisitions of businesses.