McDonalds Hit By Labour Ruling

[Mulboyne]

[floatl][/floatl]Kyodo via Japan Today: Court orders McDonald's to pay overtime to manager
The Tokyo District Court on Monday ordered McDonald's Co (Japan) to pay 7.5 million yen in overtime and compensation to a man from Saitama Prefecture who claimed that while the firm had appointed him to a managerial post, he was not given any authority as a manager and therefore should have been paid for overtime. Plaintiff Hiroshi Takano, 46, manager of a McDonald's outlet in Kumagaya City, argued that he hardly had any discretion in setting his work hours or the shop's operations. McDonald's said a manager is given broad authority in setting his work hours and running the outlet and is well compensated in salary. The Labor Standards Law stipulates that an employer is not obliged to make overtime payments to those in managerial and supervisory positions. Takano's lawyer said that while similar problems have been raised by outlet managers of other food-service companies, this is the first ruling issued by a court against a major company. The ruling is likely to have a major impact on the Japan unit of McDonald's Corp as it has around 1,700 employees working as "managers" of its directly-run outlets.

[Mulboyne]

[floatl][/floatl]NHK just reported on this issue and highlighted a few interesting points. The court apparently defined a manager as being someone with the status of a company owner with input into decisions into running the firm. By this, they don't mean to equate him with the CEO, rather it seems that they decided that Takano could only be a manager if he could act as if he was the owner of the store. That would be a very influential ruling and would affect more businesses than just McDonalds. The court also ruled that Takano's salary was not high enough to classify him as managerial although they stopped short of saying what level would have been appropriate. the 7.5 million yen awarded to Takano was for a two-year period. McDonalds intends to appeal.

[Mulboyne]

Asahi Article:

...The court said Takano should not be viewed as a legally defined manager because he had almost no influence on decisions concerning the menu, operating hours or work force recruitment... Takano joined McDonald's in 1987 and started working long hours in 2004 after he became manager of an outlet that had no other regular full-time workers under the company's cost-cutting policy. He clocked in around 5 a.m., and his overtime hours totalled up to 137 hours a month, Takano said. The hard work caused Takano to suffer a minor stroke in April 2005, prompting him to sue his company, he said...Serious cases of overwork and underpayment of restaurant managers have been highlighted in recent years. An increasing number of managers have formed or joined unions to jointly negotiate with management since 2005.

[Ketou]

Standard work practices here......
Write you clock in time in pencil please.....so we can change it later.....

[Samurai_Jerk]

Standard work practices here......
Write you clock in time in pencil please.....so we can change it later.....

That ain't just Japan.

[Mulboyne]

ZAKZAK reports (Japanese) that a source has calculated McDonalds would be on the hook for 20 billion yen if it paid backdated overtime to all it's managers.

[Mulboyne]

Asahi: Seven-Eleven to pay overtime to store managers

Seven-Eleven Japan Co. will reverse its policy and pay overtime to store managers from March, in response to a landmark court ruling against McDonald's last month, officials said Friday. Seven-Eleven's rivals, including Lawson Inc. and FamilyMart Co., have already abandoned their policies to make store managers ineligible for overtime payments. The move of Seven-Eleven, the leader in the convenience store industry, could prompt companies in the retail and restaurant industries to follow suit... But others, including Royal Holdings Co., operator of the Royal Host restaurant chain, have maintained a policy to make managers ineligible for overtime payments. A Royal Holdings representative said its managers are "adequately compensated for their duties"...more...

[Mulboyne]

Kyodo via Japan Today: Ex-McDonald's managers to file lawsuit for overtime pay

Two former managers of McDonald's Co (Japan) Ltd outlets plan to file a lawsuit with the Tokyo District Court in March demanding that the company pay them a total of 7 million yen in unpaid overtime allowances, sources close to the matter said Friday. The move comes on the heels of a court ruling in late January on a similar lawsuit filed by a McDonald's manager from Saitama Prefecture, in which the court ruled the manager had little authority as an employee in a managerial post and deserved overtime pay in accordance with the Labor Standards Law. According to a labor union of the company, the two men worked about 70-90 hours overtime a month on many occasions from December 2005 and sometimes worked more than 140 hours overtime a month.

[Mulboyne]

Asahi: Sukiya workers file overtime complaint against beef bowl chain

Three part-time workers of leading gyudon beef bowl chain Sukiya filed a criminal complaint with the Sendai Labor Standards Inspection Office here against the operator of the chain Tuesday, claiming the company unlawfully refused to pay overtime. One worker, a former outlet manager for the chain, complained the company violated the Labor Standards Law when it made her ineligible for overtime pay as a manager. The law exempts those in managerial positions from the extra pay...A lawyer representing the three said the woman's case is "even more malicious" than those at other restaurant chains, as the company promoted a part-timer to a manager position in order to make the person ineligible for overtime payments, but did not change the worker's status from contract worker to full-fledged employee...more...

[ttjereth]

Asahi: Sukiya workers file overtime complaint against beef bowl chain

I'm curious to see if there is any difference in the rulings for a domestic company as opposed to a foreign one.

[Mulboyne]

[Mulboyne]

Asahi: Standards set for 'name-only' store managers

The labor ministry on Tuesday signaled its intention to scrutinize companies that appoint workers as store managers to avoid paying overtime, while giving them little or no managerial authority. The practice is especially widespread in the restaurant and retail sectors where many so-called managers are required to work long hours. The Ministry of Health, Labor and Welfare issued a notice to regional labor bureaus that includes specific standards to determine if "managers" of restaurants and retail outlets are actually managing. Yoichi Masuzoe, the labor minister, said Tuesday: "Forcing an individual to work long hours at low pay is unacceptable. We will proceed with further improvements." The last time the labor ministry issued a notice defining standards for managers in a specific industry was 1977 when it targeted the banking industry.

The topic of store managers in name-only attracted national attention in January when the Tokyo District Court ordered McDonald's Co. (Japan) to pay a store manager overtime pay because he had no actual management authority. Until now, only vague standards have existed to determine if a worker was in a management position. These included work responsibilities and authority, discretion over work hours and compensation. Tuesday's notice includes specific examples of important and supplementary factors that would negate the managerial designation of the individual in question. Among work responsibilities and authority, factors that would determine if a worker was not a manager was a lack of authority to hire part-time staff and a lack of authority to order such individuals to do overtime.

An important factor in discretion over work hours that would determine if an individual was not a manager was a system of penalties, such as pay cuts, if the manager was late or left work early. A key factor in compensation that would not make an individual a manager is if the person's hourly pay was lower than that of a part-time worker based on the number of hours worked. A supplementary factor in compensation was an inadequate benefit system for those in managerial positions. The contents of the notice were based on a study conducted by the labor ministry this spring. The working conditions of managers at 66 outlets of national chains were analyzed and the results used to determine what constituted managerial status.

[Greji]

Asahi: Standards set for 'name-only' store managers".....Yoichi Masuzoe, the labor minister, said Tuesday: "Forcing an individual to work long hours at low pay is unacceptable. We will proceed with further improvements."......"

and when the improvements are in place, we will work those mothers till the cows come home...

[Mulboyne]

A different situation but another example of a major street front name cutting labour costs in dubious ways:

Yomiuri: FTC searches Shimachu over monopoly concerns

The Fair Trade Commission on Tuesday searched the head office of chain specialty retailer Shimachu Co. in Saitama on suspicion of violating the Antimonopoly Law, officials said. Using its advantageous position as a leading retailer, Shimachu allegedly forced its suppliers to dispatch their employees to its shops to work free of charge, according to the officials. Shimachu has about 50 stores across the country, mainly in the Tokyo metropolitan area, but also in Osaka and Hyogo prefectures among other locations.

[Mulboyne]

The two sides have now reached an agreement during the appeal process. McDonalds Japan is now recognizing that Takano was a manager in name only and will give him 10 million yen in back pay. That's a third more than he was awarded in the original judgement. There is also a clause in the agreement ensuring that Takano cannot be demoted or transferred as a result of his bringing the case against his employer. In a statement, McDonalds Japan said that reaching this agreement seemed to management like the best way forward and they will now work to promote a better work/life balance for their employees.

[Adhesive]

Very interesting thread, I can't believe I missed it all this time.

[Mulboyne]

If your Japanese reading skills are up to the task, you might want to look at this article in Diamond.

The gist of it is that full-time employees with fast food chains, family restaurants and chain apparel stores often have worse working conditions than temp or part-time employees. One of the sources quoted says that overwork is so rife that employees frequently cause traffic accidents after falling asleep at the wheel of their vehicles.

The root of the problem seems to be that companies seem to assign no more than one full-time staffer to an outlet and surround that individual with temps and part-timers. There is a high turnover of such employees and they are difficult to manage. If anyone falls sick or fails to turn up, the full-timer is usually the one who has to cover the absence while also being responsible for all administration relating to the store. The source claims many sleep at the store or in their cars nearby rather than going home.

These people aren't always badly paid. The article mentions a figure of 5 million a year for some, which is handily above the salary for a temp. What the article does indicate, however, is how the rewards for getting yourself above the lowest employment tier have shrunk as the opportunities for further promotion have receded. Price wars in retailing are hitting employees hard and full-timers are sometimes in just as dire straits as temps and part-timers.

[TennoChinko]

Years ago, I remember encountering the gaijin-version of the "manager in name only" drone in a local bar. He was the assistant manager of some eikaiwa dispatch firm, and stupidly and proudly wore it on his sleeve. Actually he had no sleeves -- like some terrible stereotype, he wore a short-sleeve dress shirt sans geek pocket protector... and a crappy double-breasted suit jacket that he must have bought from Daei.