Hitachi Construction Machinery

Global

Fair Evaluation and Compensation

Fair evaluation and compensation policies and promotion system

There are three basic policies for personnel evaluation and compensation at Hitachi Construction Machinery: 1) performance-based personnel compensation, 2) a highly fair, transparent and credible personnel evaluation and compensation system, and 3) personnel compensation based on field-oriented policy. In addition, we comply with labor laws and ordinances, including those wage-related laws and ordinances stipulating provisions on matters such as minimum wage, legal benefits, and overtime. Our basic premise for labor management is the payment of a reasonable salary, bonuses, allowances, other wages, and retirement benefits in accordance with employee wage regulations.

In accordance with these basic policies, we have established a ranking system for management level personnel based on work standards that focuses on responsibilities and the worth and merit of their professional duties. In addition, we have established a grade system that focuses heavily on the exhibition of skills for rank-and-file employees. We conduct evaluations and set compensations based on systems that completely eliminate any suggestion of seniority as a factor in evaluation or compensation.

In addition, heavy focus is placed on achieving mutual understanding through dialogue between superiors and underlings. We are implementing 3C interviews (Career-up, Challenge, and Communication). We believe this is a contributing factor to sparking communication, the training of employees, and the credibility of evaluations.

3C interviews

In order to nurture corporate culture where each individual define what he or she should do by setting goals for each half year and voluntarily taking actions to achieve them, We have introduced an objectives management system.

In implementing the system, the “3C interview”, where a senior manager performs for supervisors or lower subordinates that he or she manages, plays the key role. The meaning of “3C” is “Challenge Program” for objectives management, “Career Development Report” to analyze functional accomplishment capabilities of employees and to clarify capability development targets, and “Communication Sheet” in which subordinates ask for advice and pose questions. At the 3C interview, these three tools are used for promoting communication between the senior manager and his or her subordinate and for setting up the yearly targets and career development plan tailored for the subordinate.

Implementation of the employee awareness survey for fair evaluation and compensation

In September 2017, the Hitachi Construction Machinery Group implemented the fifth employee awareness survey. This was also the first time our overseas group companies participated in this survey. Owing to this, we received responses from 9,138 people. This survey is an awareness survey conducted via our website for the entire Hitachi Group. The goal is to assess employee awareness to grasp the strengths, weaknesses, and issues at group companies and workplaces, and to implement necessary solutions.

The results of the survey were posted on the group intranet for disclosure to all employees. In addition, issues are shared with related departments and measures are currently under development to make improvements. Specifically, through improved quality of management using 3C interviews and a system of support for employees to develop their own careers, we are building an employment environment where each and every employee can contribute their skills in a rewarding career. By continuing with these initiatives, we aim to increase the percentage of employees with positive responses to the question on opportunities for career development in the employee awareness survey to 50% or greater by fiscal 2020.

Going forward, we plan to continue to implement the survey to grasp the degree of improvement, and to promote further use of these surveys.


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