McDonald’s faces fresh lawsuit on overtime pay

Two former managers of McDonald’s Co. (Japan) Ltd. plan to file a lawsuit with the Tokyo District Court in March demanding the hamburger chain pay them ¥7 million in unpaid overtime allowances, sources close to the matter have said.

The move comes on the heels of a court ruling on a similar lawsuit filed by a McDonald’s manager from Saitama Prefecture. In late January, the court ruled that the manager had little authority as an managerial-level employee and deserved overtime pay in accordance with the Labor Standards Law.

McDonald’s told to pay overtime to manager

McDonald’s Co. (Japan) on Monday was ordered to pay 7.5 million yen to a branch manager who had often worked more than 100 hours of overtime a month without being paid.

In a landmark ruling, the Tokyo District Court agreed with the argument of Hiroshi Takano, 46, that the fast-food giant’s policy of making outlet managers ineligible for overtime pay violates the Labor Standards Law.

[McDonald’s manager] 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 totaled 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.

McDonald’s ‘manager’ wants ‘human’ life

[McDonald’s manager Hiroshi Takano] became especially busy after being transferred to an outlet in Higashi-Matsuyama in July 2004. He had no permanent staff working under him, and was in sole charge of operations there. A worker he trusted moved to a different outlet in December that year, leaving Takano to take on a number of extra duties.

Throughout that month, Takano, went into work just after 6 a.m. every day to take charge of preparing food and serving customers. Although he could take the odd nap and eat lunch, he also had to train part-time workers and deal with the takings, meaning that he was working daily until about midnight.

Working conditions also were tough at his current outlet in Kumagaya in the prefecture after he moved there in February 2005. One part-time worker was admitted to hospital for exhaustion due to overwork, and Takano often had to work to cover staff shortages.

Takano had to answer to a consultant, who issued instructions on managing outlets, and a general manager, who was in overall control. They constantly made demands, such as asking Takano to reduce personnel costs.

Takano began to feel his hands going numb and a doctor warned him that he was a candidate for a stroke.

Takano began to feel that his life was in danger.

However, no company labor union existed at the time, and so Takano joined a union for managers in the Tokyo area in May 2005.

He filed the lawsuit against the company that December.

The lawsuit was one factor that prompted the establishment of a McDonald’s labor union–one that managers of outlets could also join.

“It wasn’t about money. [Takano] wanted the hardships in the working conditions of managers to be recognized. It was almost a complete victory,” his lawyer said. “This is the first ruling that clearly shows the work of outlet managers across the country isn’t management work at all.”

McDonald’s ordered to pay overtime to outlet manager

The Tokyo District Court on Monday ordered McDonald’s Co. (Japan) Ltd. to pay more than 7.5 million yen in unpaid overtime wages to the manager of an outlet in Saitama Prefecture, saying the man is not considered to actually be in a managerial position.

Presiding Judge Iwao Saito said McDonald’s outlet managers’ discretion is limited within outlets and the position is not considered a managerial post that integrally works with company owners.

Observers say the ruling is significant in that it would impact about 1,700 managers of the hamburger chain’s direct-run outlets and other management-labor disputes. Similar lawsuits have been filed by managers of chain bookstores and moneylenders, but this is the first ruling that would affect such a large number of employees of a single company.

Hiroshi Takano, the manager of McDonald’s 125 Kumagaya outlet in Kumagaya, Saitama Prefecture, was seeking about 13.5 million yen as compensation for two years of unpaid overtime plus damages.

Joining the company in 1987, Takano was promoted to outlet manager in 1999.

As outlet manager, Takano, 46, still has to work from early morning until late at night, cooking and attending to customers. Though his overtime exceeded 100 hours some months, the company stopped paying overtime wages, claiming that Takano was in a managerial position.

The issue in contention in the suit was whether McDonald’s outlet managers are considered to be in corporate managerial positions.

The Labor Standards Law obliges employers to pay overtime for those who have worked longer than eight hours a day or 40 hours per week, and on holidays. However, the stipulation is not applied to “those in managerial or supervisory positions.”

McDonald’s told to pay overtime to manager

The Tokyo District Court ordered McDonald’s Holdings Co. (Japan) Ltd. Monday to pay ?7.55 million in overtime allowance and “additional pay” to a manager at one of its outlets.?

Presiding Judge Iwao Saito ruled that Hiroshi Takano, 46, who manages a McDonald’s outlet in Saitama Prefecture, does not qualify as a manager under the Labor Standards Law and thus deserves overtime pay.

The law stipulates that employers must pay overtime allowances to employees who work more than eight hours a day and 40 hours a week.

The ruling could deal a major blow to McDonald’s Japan, which has some 1,700 managers at its outlets directly run by the firm, like Takano, said Ichiro Natsume, one of his lawyers.

McDonalds ordered to pay restaurant manager overtime

In a Tokyo District Court ruling expected to reverberate around the nation’s fast food industry, McDonald’s Japan was Monday ordered to pay overtime wages to a restaurant manager.Presiding Judge Iwao Saito ignored the fast food giant’s claim that store managers were exempt from overtime payments because they are in managerial positions and ordered it to pay about 7.55 million yen to a man who headed one of its Saitama Prefecture outlets.

Of the food retailer’s roughly 4,700 full time employees nationwide, some 1,700 are store managers, so Monday’s ruling is expected to have far-reaching consequences.

“From their administrative authority and remuneration, it’s not possible to say that store managers are part of corporate management,” Saito said as he handed down the ruling.?

Overtime or the cure — which is worse?

According to the Health, Labor and Welfare Ministry, the average full-time employee worked 2,041.2 hours in 2006, compared with 2,028 hours the previous year. Another government survey shows that one out of every four male employees in their 30s worked more than 60 hours a week in 2005. No job category breakdown was provided.

In 2003, a worker in the manufacturing sector in Japan worked on average 1,975 hours, compared with 1,525 hours in Germany and 1,538 hours in France. Closer to Japan, but still lower, was the United States at 1,929 and Britain at 1,888.

To deal with the high overtime rate, the government prepared a revision to the Labor Standards Law to increase pay for such work.

However, it also wrote another bill to exclude senior white-collar employees from overtime pay, the so-called white-collar exclusion. Management ranks are already excluded from overtime pay.

Strong public opposition to the exclusion forced the ruling bloc — the Liberal Democratic Party and New Komeito — to shelve the bill. But labor experts and unions fear it is only being held back so it won’t affect the bloc’s chances in the July House of Councilors election, and that after the poll they will submit it to the Diet.

“The issue will definitely come up again,” labor lawyer Ichiro Natsume said. “We must work harder to make the government give up the bill completely.”

One-third of major firms have workers who do at least 100 hours overtime a month

One-third of major firms in Japan employ workers who are putting in 100 hours or more of overtime work a month, a survey by the Central Labor Relations Commission has found.

The survey, which comes as the government is pushing for the introduction of a “white-collar exemption” system to exempt salaried workers from regular working hours and abolish overtime pay, puts the spotlight on long working hours at Japanese companies.

The commission conducts surveys on wages every year. Every other year, it conducts surveys on the amount of time employees spend working. The latest survey, conducted in 2006, is the first to ask companies if any of their employees are doing 100 hours or more of overtime work each month.

Questioned in the survey were 373 firms employing 1,000 or more workers and having capital of at least 500 million yen. Responses were received from 247 firms.

The results showed that as of June 2006, a total of 33.2 percent of firms employed at least one worker who put in 100 hours or more of overtime each month. The average amount of time each worker put in a year, excluding overtime, stood at 1,881 hours, 54 minutes — a figure that remained practically unchanged compared with the previous survey.

The average wage revision resulting from regular wage hikes and raises reached 6,275 yen, an increase of 280 yen compared with the previous year. The average monthly wage fell 1,500 yen compared with the previous survey to 377,300 yen. However, monthly overtime pay rose 6,300 yen to hit 69,500 yen.

Workers who do 80 hours or more of overtime a month are considered to be at risk of dying from overwork. A standard for paying workers’ compensation due to death from overwork is acknowledging that the worker has performed 100 hours or more of overtime in the month immediately prior to his or her death. Performing 80 hours or more over overtime a month is accepted as a standard for diagnosing depression caused by excessive work.

Election puts overtime-pay exclusion on hold

Wary of an upcoming election, the ruling bloc is backing off on a highly contentious bill that would exclude certain white-collar workers from overtime pay.

But debate over the issue, which unions fiercely oppose, will resurface because the government’s retreat is widely believed a mere postponement until after the July Upper House election.

Certain white-collar workers would be excluded from legal work-hour restrictions under the Labor Standards Law, which limits work hours to eight hours a day and 40 hours a week and obliges employers to pay for overtime.

The government says the proposed system is modeled after one in the United States with the same name.

Unions and opposition parties branded the proposal the “elimination of overtime pay bill,” provoking fear among salaried workers that they would receive no extra pay even if they have to continue working long hours. This worried lawmakers in the ruling Liberal Democratic Party and New Komeito whose eyes are on the summer Upper House election.

Unions are against the system itself because changes to the hour limitations would mean abolishing the most basic protection for employees.

They argue that without changing Japan’s notorious penchant for requiring long work hours, the new system would only make matters worse and workers would get less pay.

Chinese trainees flee poor work conditions

Three Chinese women working in a training program fled their workplace in Aomori Prefecture early Monday and contacted labor authorities to complain of poor conditions, The Yomiuri Shimbun learned.

The trainees came to Japan two years ago and have worked at a small sewing factory in Misawa in the prefecture.

The three women complained of working 13 hours a day, with their overtime pay falling short of the stipulated minimum wage, and rarely being allowed to use heaters even in midwinter at the company dormitory, which is a refurbished garage.

The three told the Yomiuri they could not bear the situation any longer with winter approaching.

Just after 5 a.m., the three trainees, each carrying an overnight bag, ran from the dormitory in front of the factory to a car driven by a member of a Fukui-based organization supporting foreign workers.

About two months before, the three telephoned the organization, after reading about it in a Chinese newspaper, and made plans to flee.

One of the trainees, a 32-year-old woman from Shanghai, said: “I came to Japan to earn money. I’ve been a migrant worker at sewing plants in Saipan and the United Arab Emirates, but I wasn’t treated this badly.”