No wage payment
What would you do if you had no wage payment in the event of your company’s bankruptcy?, although you are here in Japan to earn valuable yen. You’d give up, or persistently try to chase the president or CEO for your payments during your working period. The workers in Japan, regardless of they are foreigners or Japanese, are facing the risk of more corporate bankruptcies.
The number of corporate bankruptcies in Japan, which had once dropped late in eighties, has been on the rise steadily since 1997(chart). After the collapse of the high inflated economies so-called “Bubble economy”, the Titanic of Japan Inc. has been slowly sinking. With the stagnant trend in the past several years, more bankruptcies have come to light. Among them, what’s outstanding is the bankruptcies of major cooperates listed in the Tokyo exchange. Seeing the chart again, the amount of liabilities has skyrocketed in 1997. This was because especially the financial institutions such as one of the city banks, securities brokerages, life insurers had gone bust though the year. Even since then, big bankruptcies have not ceased in financial and retailer sectors.
Of course, small businesses have been greatly affected by the bad economy. As the structure of the Japanese business, many of the small businesses are sub-contractor for big companies particularly in the manufacturing sectors, for instance, car makers, electronic manufacturers. In the process of restructuring the business, those establishments have been targeting at the sub-contractors to decrease the number as business partners. Therefore more small businesses will have been plagued by the restructuring efforts of the big establishments. Those employees who work for restructuring-targeted companies face the risk of losing jobs. They might not be able to secure the jobs from the moment of bankruptcies, but also secure the wages they work in the past because the bankrupt companies can’t pay even wages.
Despite of the employees’ circumstances, you can be saved by the rescue boats in the event that your company goes bankrupt and fails to give wages to you. There is a system in Japan in which the government advances the worker wages on behalf of the company, based on the Security of Wage Payment Law. which applies as below.
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Who is beneficial?：
An employee has been working for a company for a year or more to which the Worker’s Accident Compensation Insurance Law is applicable●
What situation the employee is in?：
A company goes bankrupt legally or substantially(recognized by the director of the competent labor standards inspection office).：
An employee is made redundant by the company on a day within the period from the previous six months to two years thereafter as counted from the day when the bankruptcy was filed with the court or recognized by the director of the labor standard inspection office.●
How much the employee is paid?：
Basically the employee will get 80% of the total amount of unpaid wages and resignation or retirement payments for the period from six months before the employee resignation or retirement up to the day before bankruptcy was filed.：
There is a limitation on the amount off advance (560,000 to 1,200,000yen) depending on the age of the employee who has resigned or retired.
<The number of bankruptcies and the amount of liabilities >