Human Resource Management System Reforms at Matsushita

All of them offered to quit by early 2002. Analysts felt that this was mainly because of the 'generous' severance package announced by Matsushita. The company had offered to pay as high as 40 months wages as additional allowance apart from the regular retirement allowance the employees were entitled to.

While Matsushita claimed that the retirement plan was not compulsory, many employees reported that they were continuously being forced to opt for the early retirement plan. In addition, there were media reports of human rights violation at some plants of Matsushita, where the employees were reportedly ill-treated and forced to quit the organization.

They were employed until the mandatory retirement age, which varied between 55 to 65 years. Moreover, leading corporations in Japan offered their retired employees the opportunity to work for another ten years in their satellite offices⁴. Companies in Japan never laid-off employees even in the worst economic conditions.

They tackled adverse situations by reducing overtime, stopping pay hikes and new recruitment. For instance, none of the automobile companies in Japan resorted to layoffs though the overall production declined by 8% in the late 1990s...