Toyota Motor Corp., the largest automaker in Japan and the biggest in the world, has a profit tally that dwarfs that of all other local carmakers, but the company has proposed a salary increase that is one-third smaller than its union asked.

The carmaker has announced it came up with a 4,000 yen ($33) monthly wage raise and workers are scheduled to vote on the offer by the end of the month – which is below the union demand of 6,000 yen. The company had already said the union’s demand was too high – the largest since 1998, claiming the impact would have been of around 20 billion yen on labor costs. The counter-offer, which could be a signal for similar measures across the industry, shows the difficulties faced by labor groups and Japanese Prime Minister Shinzo Abe’s government when attempting to convince the companies to share more of the record profit incurred from the country’s currency measures.

Additionally, the Toyota management is scheduled to accept on March 18 the other union demands – bonuses equivalent to 6.8 months of salary and a 7,300 yen average pay hike based on seniority or promotions, said a company spokesperson. The amounts are the same as last year. According to the Confederation of Japan Automobile Workers’ Unions all the other ten unions representing workers in the country’s auto industry also rallied to the demand that Japan’s auto companies would raise monthly pays by 6,000 yen.

Via Bloomberg


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