Roger Agustin

Musing of Sarariman
The Paradox of
“Oyaji Sarariman”

May - June 2014

I came across a very interesting article that more or less relates to me in my daily work the “Oyaji Sarariman.” It made me curious at the same time conscious, because I realized I already fit the qualifications of one, age-wise I mean.

And so the article says that there is a growing complaint from the younger generation of workers that the senior employees, a.k.a. ‘Oyaji Sarariman’,  are being paid or rewarded more when they are seen to be working less or not as hard as than their younger counterparts.

I can’t blame the younger generation of workers for feeling the unfairness after going through years of stiff competition in getting into the workforce. But neither can I blame the old guys when they have gone through almost two decades of economic downturns, restructuring, offshore transfers of their jobs, and the constant fear of being laid off.

Senior employees who have worked for the same company are known to have established vested rights that have developed in their early years due to their hard work. It is still deeply rooted in the traditional Japanese Management System, the so called Three Sacred Treasures that forms the basic foundation of the Japanese employment system. Namely: 1. Lifetime Employment, 2. Corporate Unions, 3. Seniority-based Payment.

Lifetime employment is almost gone, unions are not as visible, but seniority-based payment probably would survive for a long time even when performance-based pay has been the main trend for so many years.

Many experts on labor econo-mics refer to Prof. Edward Lazear’s theory on Mandatory Retirement when explaining the mystery of the Japanese employment system with respect to why employee salaries increase overtime.

Based on the theory, a new or young employee tends to get a lower salary compared to his productivity because he works hard and contributes more to the company than expected.  By the time he reaches the retirement age, his wage is higher than his contribution or performance. This is expected anyway since everybody works hard to race for promotions. Eventually both wage and performance balances throughout the employee’s career in one company. Also, one of the strong motivations for lifetime employment is the huge lump sum retirement allowance one can get based on the salary at retirement. In a seniority-based working environment, a junior employee is expected to work very hard, and even if his performance exceeds that of his elder peers, the pay is still according to seniority. The young generation of employees will not understand this concept first, but wait until they are going through the same path of seniority, they would most likely embrace the same concept. Elder employees are still valued by companies not only because of their long term loyalty but also because of the deep knowledge that they have deve-loped through the years and with Japan’s ageing workforce, some companies are keeping their older workers employed even re-hiring them after retirement to ensure the transfer of their institutional knowledge.

So to young workers, you think that those “oyaji” folks are not working as hard or even less than you do? They just work smarter.