Employment subsidies to reward companies with rising productivity

“Sources said the reform is meant to increase support to growth companies as well as encourage small to medium-size companies to raise their productivity now that the minimum wage is set to go up.”

“Math will be involved in evaluating whether companies meet the requirement. An indicator is to be obtained by dividing the sum total of certain financial data points — such as a company’s operating profit, depreciation expenses, and labor costs — by the number of its employees.

The sources said labor costs are to be included in the formula to discourage businesses from trying to raise their productivity by discarding workers.

Companies that get their indicator to rise by a specified degree will receive 10% to 20% more in subsidies. Companies that have a declining indicator will have their subsidies cut.”