(Japan Times) In order to prevent problems such as unilateral changes of outsourced work and unpaid or reduced remuneration, the government aims to create a law to require companies to clearly state details of work and payment amounts so that freelancers can work with peace of mind. The government hopes to submit a related bill to the ongoing ordinary session of parliament, convened earlier in January.
Even with the legislative action, however, challenges remain before freelancers can gain adequate protection.
Freelancers, who run their own businesses and earn income by making use of their knowledge and skills, cover a wide range of job categories, including system engineers, designers, instructors and writers. According to a 2020 survey by the Cabinet Secretariat, an estimated 4.62 million people were freelancing — about 2.14 million as their main business and some 2.48 million moonlighting from other jobs.
While many such workers were satisfied with working styles that are relatively free of constraints, they often run into problems, with 37.7% saying they had experienced problems with companies from which they had received job orders. The most common issue was that details of compensation and work were not made clear at the time of job order placement. Many also reported delays in compensation payments, cases of nonpayment or nonconsensual pay cuts.
Of the respondents, 53.9% said they had negotiated directly with the companies, while 21.3% said they had accepted their conditions submissively without holding talks.
"(Companies) do not deal with sole proprietors seriously in the first instance," a delivery driver in his 50s said. As he is in a weaker position, the man explained, it is difficult to negotiate.
Many freelancers are believed to be forced to accept outcomes lying down even if they face one-sided changes in contract terms or remuneration nonpayment.
To prevent such situations, the government aims to make it mandatory under the planned law for companies to issue documents, including emails, detailing contract terms with freelancers, such as the content of consigned work, the amount of remuneration and the payment date. For longer contracts spanning set periods of time, the return of delivered products and the reduction of remuneration are expected to be stated clearly as acts that are prohibited unless there is a fault on the side of freelancers.
Similar regulations are already in place under the subcontract law for companies with capital of more than ¥10 million. The planned new law will require small and midsize companies with capital of ¥10 million or less, which are not covered by the existing law, to comply with such rules when they outsource work to freelancers.
When a contract is canceled part way through or not renewed, advance notice of 30 days will be required in principle. Companies using the services of freelancers will also be asked to establish a mechanism against acts of harassment.
The new law, if put into force, would improve the working environment for freelancers, but there are still issues that must be tackled.
As freelancers do not fall into the category of workers employed by business owners, they are not eligible for employment insurance, including jobless benefits, or minimum wage guarantees under the Labor Standards Act in principle, a major concern for such service providers.
In a 2021 survey of such workers conducted by the Japanese Trade Union Confederation, or Rengo, the umbrella organization for labor unions across Japan, more than 30% of respondents called for a system comparable to employment insurance.
Yuichiro Mizumachi, a professor at the University of Tokyo who specializes in labor laws, said, "In efforts to expand the safety net (for freelancers), it is necessary to respond appropriately while keeping an eye on the trends of the times and changes in society."
