Why do new hires quit? From "the Survey on Pre- and Post-Hire Troubles 2022."

◆May is a time when new employees leave the company.

May is a time when an increasing number of people experience symptoms of feeling unwell, known as "May illness" after the Golden Week holiday, and we also see the resignation of newly hired employees.

It is also a time when new employees, who have been feeling tense as they dive into a new environment, lose their tension and begin to feel dissatisfied with the company.

◆The reality of "30% job turnover within 3 years.”

According to the "Survey on Pre- and Post-Employment Troubles 2022" conducted by the Japan Trade Union Confederation (targeting 1,000 men and women in their second to fifth year of employment nationwide who had graduated from college and started working as full-time employees), 7.7% had "left" the company they joined after graduation (within six months). 6.2% of the respondents "left their jobs (within 1 year after 6 months)," 10.4% "left their jobs (within 2 years after 1 year)," 5.2% "left their jobs (within 3 years after 2 years)," and 3.7% "left their jobs (after 3 years)," indicating that the often- mentioned "30% of workers left their jobs within 3 years" is also true here.

◆Why did the new employee quit?

When asked why they quit their companies in this survey, the most common reason given was that "the job did not suit me" (40.1%). This was followed by "Working hours, holidays, and vacation conditions were not good" (31.0%) and "Wage conditions were not good" (27.4%), indicating that a greater percentage of respondents cited a mismatch in work than in compensation. The percentage of "Left job (total)" was 41.9% for those who did not receive new employee training or guidance/advice from senior/supervisor, 11.0 percentage points higher than those who did receive guidance/advice (30.9%), indicating that there is a large difference depending on the support provided by the surroundings.

The employers want to avoid employee turnover after hard work and effort in hiring. Workplaces with new employees will need to be considerate of those around them.

Full-Scale Discussion on Monetary Settlement of Termination of Employment - MHLW Study Group Report

On April 11, an expert panel of the Ministry of Health, Labor, and Welfare (MHLW) held a meeting to discuss a system whereby companies would pay money to workers who have been wrongfully dismissed, rather than returning to work. The committee compiled a report outlining legal issues, and the Labor Policy Council, whose members are representatives of labor and management, is expected to hold a full-fledged discussion on the pros and cons of the introduction of the system. The report envisions a system whereby workers whose dismissals are invalidated by lawsuits or labor tribunals would receive money from the company to end their labor contracts if they so desire.

Discussions on a monetary settlement system for layoffs began after the government included it in its growth strategy in 2015. While the government and the business community have been active in introducing the system, labor unions and others have opposed it, claiming that it will be misused for restructuring, and discussions at the Labor Policy Council are expected to be difficult.

The report defined the system as covering workers whose dismissals notified by their employers were found to be invalid for lack of reasonable cause. The motion for monetary settlement was limited to workers. The proposal was not included in the discussion because there are issues that are not easy to solve under the current circumstances, such as allowing a company to dismiss a worker again.

The amount of salary, years of service and age are presented as requirements for consideration in the calculation of the "labor contract termination payment" to be paid to workers. Setting a maximum or minimum amount to increase predictability should be discussed in the future.

There are already mechanisms, such as lawsuit settlement procedures and labor tribunal conciliation, whereby a worker who considers his or her dismissal unfair but does not wish to return to work can receive a monetary payment from the company to end the labor contract. However, the government has been pushing for the introduction of a new system, saying that it would give workers more options.

In May 2017, another expert panel of the Ministry of Health, Labor and Welfare (MHLW) compiled a report stating that "a certain degree of necessity is recognized," but later, at a subcommittee of the Labor Policy Council, members of the labor side of the introduction of the system were opposed, saying that there were concerns that it would be used as a means of restructuring or lead to more options for dismissal.

The MHLW established a study group of legal scholars in 2018 to further clarify legal issues, and discussions were ongoing. (Kyodo News)