On June 13, 2006, the Japanese Ministry of Health, Labor and Welfare (MHLW) proposed a package of changes to current labor laws.  The proposal would raise the extra rate paid for overtime hours from its current 25% to 50%, but only for overtime over 30 hours a month.  Additionally, a worker who put in 40 hours of overtime a month would receive an extra vacation day, to be taken within one month.

Japanese workers have conventionally worked long hours, many of them unpaid in an illegal but widespread practice known as "service overtime."  Authorities see excessive overtime as weakening the health and productivity of the workforce, as well as harming parents´ ability to properly raise their children.  These concerns are of more and more concern as Japan´s society rapidly ages. The proposals come against a backdrop of increased enforcement of existing labor laws.  In recent years, the MHLW has cracked down, forcing companies to pay the equivalent of hundreds of millions of dollars in back wages for unpaid overtime.

The government is also moving toward more flexible working hours for some categories of employees.  At the same meeting, it announced plans to develop a "self-directed labor system."  Under this system, some employees could be made exempt from current overtime regulations.  They would have to meet a minimum salary requirement, as well as other guidelines not yet determined.  The MHLW has indicated that this system´s development would depend on consultations between representatives of employer associations and unions.

Also included in the MHLW´s package is a proposal to give long-serving contract employees more opportunities to become regular employees, and one to let workers take five of their paid vacation days sequentially.  The ministry hopes to submit its package to the Japanese Diet next year.