Bloomberg News

Japan’s Lower House Passes Bill to Let Workers Stay on to 65

August 03, 2012

Japan’s Lower House Passes Bill to Let Workers Stay on to 65

Japanese businessmen in downtown Tokyo. Photographer: Everett Kennedy Brown/EPA

Japan’s lower house of parliament approved legislation that would give private-sector workers the right to remain in their jobs until they are 65 years old rather than 60 as the nation struggles with welfare costs.

Lawmakers passed the bill yesterday, according to the lower house website. It would take effect in April next year after approval in the upper chamber, where the ruling and opposition parties have expressed support for the measure.

The legislation is aimed at helping workers cope with an extension in the age for drawing pensions to 65 by 2025, according to the Health Ministry. At the same time, employers will be able to refuse to keep workers after they turn 60 if they have grounds for dismissal, and won’t be fined for failure to comply with the law.

Prime Minister Yoshihiko Noda’s ruling Democratic Party of Japan is fighting to win approval for his plan to increase the consumption tax, which would help fund social security costs in the country with the world’s oldest population.

About 23.3 percent of Japanese people were 65 years old or over as of October last year, according to the Cabinet Office, and the percentage is set to rise. Japanese are among the longest-lived people in the world, with women’s life expectancy at 85.9 years and men’s at 79.4 years in 2011.

Companies that don’t comply with the new law will not be fined, but their names may be publicized, the ministry said.

To contact the reporter on this story: Isabel Reynolds in Tokyo at ireynolds1@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net


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