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To manage the flow of human resources within organizations, some large and prestigious Japanese firms have adopted the policy of "lifetime employment" (Fisher et al, 10). There have never been any official rules concerning implementation of lifetime employment, but there has been a convention of long-term employment among the large corporations. It is based on the concept that if an employee devotes his life to his company, the company will in return provide him with a guarantee of lifelong employment, housing and other things to take care of his needs. In a sense, this commitment means that the employee ceases to be an individual and becomes a part of the company (Osamu, 15). Fisher et al (10) found the employees covered by this policy comprise to 0 percent of the full-time work force. Many are white-collar and some are blue collar workers. They are guaranteed job security from the time they hired-upon graduation-until they reach the retirement age of fifty-five.
Why do the firms adopt the lifetime employment?
Firstly, one of the important reasons to adopt the lifetime employment system is the system which provides certain categories of staff with employment that lasts throughout their working life (Beardwell & Holden 17). Once employed by one company, an employee might expect to work uninterruptedly until retirement age in the knowledge and expectation that work, training and, quite often, housing and education for dependants would be provide. These companies have recruited at graduate-level and as an employee you have often experienced an annual wage increase, more or less automatic promotion with age and it has been highly unlikely to be dismissed because of a recession. As a result of this people have often identified strongly with their company and stayed with the same company for a long time, since they have not benefited from changing jobs. The system has thus been mutually beneficial.
Secondly, another important reason is the lifetime employment is the desire of Japanese employers to inhibit the mobility of highly trained workers. For instance, if an employee wants to resigns from a major company, he has to seek a lower-paying position at a small company or join a foreign-owned enterprise doing business. That means the employee lost his status and would get a low salary. Therefore, the mobility almost exits.
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