Diverse Regular Employees and Non-regular Employment

Author Name MORISHIMA Motohiro  (Hitotsubashi University)
Creation Date/NO. April 2011 11-J-057
Research Project Reform of Labor Market Institutions
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Currently there are high expectations for the introduction of policies related to diverse regular employees. These policies are a response to the problem of disparities between regular and non-regular employees (part-time, temporary, contract and other non-regular employees) and will make it more likely that workers can balance work and their private lives while companies benefit from the advantages of regular employment. In this paper, I look at two issues that underlie this discussion.

The first issue is the characteristics of companies that are adopting diverse regular employee policies. In particular, I examine companies' management of employment, employee evaluation/compensation, human resource training, use of non-regular employees, work-life balance, and companies' other ways of managing human resources. The results of the examination suggest that these companies may be striving to make their rigid internal labor market for regular employees more flexible, which includes adopting diverse regular employee polices. These companies also actively work to ensure a work-life balance among employees and to make effective use of female employees. It also became clear that these companies may use non-regular employees, particularly contract employees and dispatched temporary staff, not simply to reduce labor costs and respond to changes in the demand for labor but out of awareness that these employees are important in terms of business.

The other issue is the impact of diverse regular employee policies on the perceptions of workers. The examination of this issue shows that diverse regular employee policies do not have a major impact on workers hired as regular employees regardless of the form of employment. As for non-regular employees, diverse regular employee policies that differentiate between career paths and work content show a positive relationship with worker motivation and acceptance of disparities in compensation, but policies that only differentiate between career paths have a negative relationship. These and other results suggest that companies that manage their human resource portfolio based on a consistent strategy, not simply on differentiating between career paths, can be expected to benefit from diverse regular employee policies.