Reforming the regular employment system: Toward a new norm of job-specific employment contracts

The chief characteristic of Japan's postwar employment system, built around the needs of large corporations, is (a) a higher rate of lifetime employment and (b) deferred compensation, which is reflected in Japan's steeper age-wage profile, and relatively late-stage promotions and late-career tracking relative to comparable nations. However; a key attribute of regular employment in Japan-its indefinite or unrestricted nature-has received less attention than it deserves. Companies make no guarantees regarding regular employees' duties, job locations, and working hours at the time of hiring. All are left indeterminate. The indefinite nature of regular employment is linked to the causes of many employment problems. The diversification of regular employment needs to progress to the point where job-specific' regular employment, in which employees' job contents are clearly defined, becomes the new norm. This article presents some of the policies that must be put in place in order for this shift to occur.