Kikuchi said details of the pay cuts have not been decided, although the overall average is likely to decline. The overhaul will focus on improving meritocracy, meaning employees who do not hold management titles but are in leadership roles may be paid more, while some others could see a cut.
“First and foremost, we’re hoping employees can be paid and graded according to the roles they play. Cost effectiveness should improve as a result,” she said.
Takahiro Nonaka, general secretary of the electronics union, said it has not yet set its official position, but higher pay is crucial for the economy. The union is likely to demand the same 2 percent rise as Japan’s pace-setting metal workers’ union, which includes carmakers.
“Personal spending, which accounts for around 60 percent of GDP, needs to grow,” Nonaka told Reuters. “We want to share that understanding with companies as we negotiate.” (Reuters)
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