This law, initially passed in July 2003, aims to slow the declining birth rate in Japan, caused in part by the difficulty women have with working full time and taking care of a child.  The law requires large companies (more than 300 employees) to provide more support programs for working parents.  Companies must submit action plans that outline the programs they plan to implement, as well as specific targets.

In an effort to make it easier for working parents to balance work and family life, more and more Japanese firms have begun offering on-site child care facilities, telecommuting, and flexible or shorter work schedules.  The availability of such incentives for both men and women will help to create a working environment in which women feel more comfortable taking time off to have children, and in which men (and women) feel more comfortable taking child care leave to look after their children.  Companies that have already begun to offer these incentives have also seen overwhelmingly positive feedback in recruitment.

The "Next Generation" law will be in effect until 2015.  Companies that do not comply with the law will not be penalized, but may be "encouraged" by the government to take action.  Companies that reach their target goals can receive an official certification and display a special logo in their company brochures or advertisements.  This would attract more parents to apply for jobs, as well as help to retain women who might otherwise leave their jobs after having a child.