Big electronics makers eyeing pay freeze, effective pay cuts+

TOKYO, March 17 Kyodo - Major Japanese makers of electronic and electrical equipment are planning pay freezes or effective pay cuts for the 2009 business year as they prepare their wage proposals Wednesday in response to union demands in this year's ''shunto''
annual wage talks, industry sources said Tuesday.

Toshiba Corp. plans to freeze employees' wages in the first six months of the
year starting April 1 due to its deteriorating earnings under the current
economic slump, they said.
Toshiba is the first major Japanese electrical machinery maker to be reported
to be planning to freeze automatic pay hikes. The company expects to log a
group net loss of 280 billion yen for fiscal 2008 ending this month as its
mainstay semiconductor division has been hard hit by the recession.
Sharp Corp. also said the same day it plans to temporarily postpone a regular
wage hike. The Osaka-based consumer electronics maker and its union also agreed
on annual bonuses equal to 4.1 months of wages, down sharply from 5.26 months
of bonuses last year.
Japanese firms set a pay scale, or a table for basic wages, based on which
workers' wages automatically increase every year by a certain amount according
to seniority and length of service.
An employee on the scale is supposed to see an increase at the start of a new
business year. But freezing a regular increase means cancellation of the
expected wage rise for employees.
Hitachi Ltd. plans to increase the number of unpaid holidays in effectively
cutting wages, while Sanyo Electric Co. is considering a freeze on automatic
pay increases, the sources said.
Panasonic Corp., Mitsubishi Electric Corp. and other manufacturers are expected
to turn down demands for wage hikes.
Automakers will also present their wage proposals to unions on Wednesday.
Toyota Motor Corp. and its union have virtually agreed on bonuses equal to five
months' wages plus 100,000 yen, which average 1.86 million yen, down 670,000
yen from the previous year.
While the labor union of Nissan Motor Co. is calling for an automatic wage
increase of 6,000 yen per month, the management team has yet to decide whether
to accept the demand. Unions at some other automakers may fail to secure
regular wage increases.
Toyota, Nissan and other automakers, including Honda Motor Co. and Mazda Motor
Corp., intend to reject demands for pay hikes, the sources said.
Pay proposals by makers of electric equipment and automobiles on Wednesday will
draw strong attention as they will set the pace for overall wage negotiations,
which are getting tougher for labor unions in light of worsening corporate
earnings amid the global economic slowdown.
The Japanese Electrical Electronic & Information Union, the umbrella
organization of labor unions in the electrical equipment industry, maintains
that the management side should agree at least on automatic wage hikes if they
wish to avoid walkouts by workers.