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In Japan, a Caste of Part-Timers Rebels

Photographer: Tomohiro Ohsumi/Bloomberg

Miho Marui, a former contract employee for KDDI Corp., poses for a photograph in front of the KDDI Corp. building, center, in the Shinjuku district of Tokyo. Close

Miho Marui, a former contract employee for KDDI Corp., poses for a photograph in front... Read More

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Photographer: Tomohiro Ohsumi/Bloomberg

Miho Marui, a former contract employee for KDDI Corp., poses for a photograph in front of the KDDI Corp. building, center, in the Shinjuku district of Tokyo.

Miho Marui isn’t exactly sure how she wound up standing on top of a bus on a blustery Tokyo day in 2009, staring up at the 35-story headquarters of KDDI Corp. (9433)

There she was, hands trembling, as she shouted up at her bosses through a loudspeaker while co-workers pressed against the windows to watch her pick a fight with Japan’s second-largest phone company over labor practices at one of its subsidiaries.

“I guess I was just mad,” she said. Marui had spent an entire evening explaining why she and a friend started Japan’s first union for temporary workers and how, eight years and a lawsuit later, the fight goes on. Tokyo District Court last month recommended that the KDDI subsidiary pay Marui a year’s wages to compensate her for wrongful termination -- a victory of sorts, though not nearly what she asked for.

“It sounds pretty ridiculous,” the 42-year-old said at the end of her story about how a marine biologist from Japan’s top university got stuck in a dead-end job and became an activist in a country where not standing out is a treasured trait. “It’s like, ’Can this really be happening?’”

It is, to her and Japan, as the country’s tradition of lifetime employment crumbles. While the U.S. debate about economic inequality focuses on the richest one percent versus everyone else, here the lines are drawn between those with full-time jobs and a ballooning underclass of 20 million temporary workers. The latter, according to the government, now make up almost 40 percent of the workforce and get paid 38 percent less.

Photographer: Akio Kon/Bloomberg

Yoko Mitome, a former contract employee for KDDI Corp., right, speaks during a protest outside the KDDI Corp. building in Tokyo. Close

Yoko Mitome, a former contract employee for KDDI Corp., right, speaks during a protest... Read More

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Photographer: Akio Kon/Bloomberg

Yoko Mitome, a former contract employee for KDDI Corp., right, speaks during a protest outside the KDDI Corp. building in Tokyo.

They are also disproportionately women.

Biggest Problem

“It’s Japan’s biggest problem,” said Yoshio Higuchi, a professor of economics at Tokyo’s Keio University and head of a government panel on labor market reform.

A dearth of regular jobs is the source of so many of Japan’s troubles, he said, ticking them off on his fingers: deflation, higher poverty rates, lower economic productivity, even depressed birthrates. Parents don’t want their daughters to marry temps; banks won’t give them home loans; and employers don’t want to spend money training them.

Marui arrived for the interview armed with a thick sheaf of pay slips going back to 2000. Rail thin, in a light blue oxford shirt, she didn’t look like she had a lot of weight to throw around. Still, as she talked, there was something reminiscent of Juzo Itami’s “A Taxing Woman,” the 1987 movie about a tax auditor who’s a stickler for the rules and always able to uncover dirt; she’s right about a lot and also a total pain.

As Marui’s father put it in an interview: “She’s a little too serious for her own good.”

Posted Apology

During her battle with KDDI Evolva Inc., the wholly owned subsidiary that employed her, Marui filed a claim that forced the company to pay back wages to hundreds of women. Another claim compelled her employer to post an apology in the entrance of the KDDI building for trying to dissolve her union. Wielding a megaphone day after day, she told thousands of Tokyo commuters about how her employer paid its temps less than full-timers for similar work.

KDDI Evolva declined requests for an interview and wouldn’t answer written questions about this story, citing the court case.

Full-time status in Japan, known as seishain, is something like tenure for college professors in the U.S. It’s a job for life, often with subsidized lunch at the company cafeteria and allowances for housing and commuting. The biggest benefit is legal protection against dismissal, backed by decades of court precedent.

Chipping away at those privileges -- even though it would make business happy -- is political suicide. Prime Minister Shinzo Abe has overhauled currency policies and raised the consumption tax for the first time in 17 years, but he retreated from early promises to tackle labor reforms, saying “there’s no national consensus.” Instead, he’s looking at an easier target: policies that will expand the ranks of temporary workers.

Falling Pay

“Abe’s proposals basically say, ‘We’re going to enable workers to work at shitty jobs with shitty pay for as long as they want,’” said Jeff Kingston, head of Asian Studies at Temple University’s Tokyo campus.

There are 1.1 million fewer full-timers today than when the prime minister took over in December 2012, according to Japan’s official statistics bureau. Temps and part-timers -- who often work 40 hours a week -- account for all the jobs growth in the past five years. Sixty percent of employment offers in March were for temporary positions.

The rise of these jobs -- to a record 38.2 percent of workers in February -- is why Japan is the only developed country where average pay has consistently fallen, dropping 15 percent since 1997. And in Japan, where the labor market is less fluid than in the U.S., temp work isn’t usually a stepping a stone to something better. It’s a lifelong condition.

Ice Age

Marui ended up a temp worker mostly by being in the wrong place at the wrong time, like a lot of people from a generation known as Japan’s “ice age.” When she got out of school in 1995, the country’s asset bubble had burst. The Nikkei 225 Stock Average had lost more than half its value and Japanese employers, who prefer to recruit straight out of college, weren’t hiring.

So Marui, who loved the ocean ever since childhood fishing trips with her dad, went into a Ph.D. program in marine science at University of Tokyo. She got a master’s degree before deciding academia wasn’t for her.

In 2000, she spotted a want ad in the paper. KDDI Evolva was hiring operators for KDDI’s international call center. The jobs were advertised as offering the opportunity to transition into full-time work, according to Marui and another woman she worked with, Yoko Mitome.

Working as an operator was once considered a plum job for a Japanese woman, on par with being a stewardess. Perfect diction and mastery of the Japanese language’s complex honorifics were prized skills. Even today, Japan holds an annual contest to decide the nation’s top telephone receptionist.

Tour Buses

“Tour buses used to stop in front of KDDI’s headquarters and guides would say, ‘This is where Japan’s best-paid women work,’” Mitome said.

By the time she and Marui joined, though, that was the past. The era of mobile phones and the Internet had arrived, and the company, once Japan’s sole international phone service (the K in KDDI stands for “kokusai,” or international, in Japanese) was remaking itself. The operators were caught in the middle.

KDDI Evolva kept Marui and Mitome on contracts as short as six months that rolled over for years. Operators were very rarely promoted to full-time.

Eight Percent

Mariko Ara, a spokeswoman for KDDI, declined an interview request, writing in an e-mail: “KDDI cannot respond to questions about labor practices at KDDI Evolva because the two companies are separate legal entities.”

The Evolva subsidiary is registered to the same address as the parent company, the skyscraper in Tokyo’s Shinjuku district where Marui and Mitome worked on the 11th floor. KDDI says it has 11,231 full-time employees at the parent and wouldn’t disclose the number of temps. KDDI Evolva has about 1,250 full-time workers and 13,750 temps, according to its website.

At the office, Mitome was drawn to Marui -- probably for the same reasons Marui’s bosses didn’t like her, Mitome said.

“She stuck out,” Mitome said. “She was better educated than everyone else and they knew it.”

At 56, Mitome was carefully dressed in a lavender blouse. She wore two heavy gold rings, which she said a TV producer once asked her to remove for a news interview because they clashed with the image of a low-paid part-timer.

“No rings. No interview,” Mitome told him.

Happy Hour

Reminded of the episode, Marui joked: “That’s Japan’s working poor for you. We’re neat and clean on the outside, but there’s nothing in our wallets.”

The two women, both single, began going out for drinks after work. Over time, happy hour turned into gripe sessions.

How come almost nobody got promoted to full-time? Why were operators forced to reapply after three years and go through the charade of pretending to be total strangers? (Their own answer: so pay and vacation days could be dropped back to starting rates.) And why were the operators forced to be at their desks five minutes before the 7 a.m. shift started?

In one of her darker moments, Marui confided to her friend: “I feel like I’m living just to pay rent.”

Mitome said: “I’ll never forget that.”

Labor Probe

Finally, in November 2005, Marui took her misgivings -- and her pay slips -- to the Tokyo Labor Bureau’s Shinjuku office, a short walk from the call center.

Within two months, KDDI Evolva was ordered to pay back wages for the 5 minutes Marui had been required to work without compensation each day. The bill came to 50,000 yen ($491) for two years’ worth. After a few more months, all of the operators were paid.

This didn’t make Marui a hero on the floor. Many of the operators, especially the older ones, worked to supplement their husbands’ incomes. Extra pay gave some of them just enough money that they could no longer be taken as dependents on tax returns.

Following the payments, the company cut Marui’s hourly rate by 10 yen from 1,460 yen to 1,450 yen, offering no reason, Marui said. It was especially irritating, Marui said, because she’d won dozens of monthly awards for being a top employee. She still has the prizes piled up in her closet: miniature stuffed animals that appeared to be leftovers from marketing campaigns.

“We all knew what the stuff was,” she said. “They were giving us their trash.”

Pay Cuts

A month later, in August 2006, KDDI Evolva announced on its employee website it was halving allowances for early, late and weekend shifts and would also stop paying commuting costs. Profit at KDDI had slipped 5 percent the previous fiscal year, but the stumble came after a 15-fold increase in the four years before that.

That was the tipping point. Marui, Mitome and 21 other temps formed a union in November of that year to protest. Mitome, who was the oldest, was named president. Marui was her No. 2.

In the following 18 months, they petitioned politicians and explained the conditions female part-timers faced. They pounded Tokyo pavements and handed out thousands of leaflets at train stations. The union climbed to 33 members at its peak.

The media took an interest. On May 6, 2008, a popular news show, “Gaia No Yo Ake,” ran a profile of Marui that was watched by more than 4 million households in Tokyo alone, according to Video Research Ltd.

Rising Sun

One image showed Marui eating her usual lunch: a block of white rice flavored with a dried plum plunked in the middle. It’s a meal jokingly known as “the lunch box of the rising sun” for the memories its stirs of post-war hardship.

“I guess they wanted to show how poor she was,” said Marui’s mother, Kumiko.

Her husband, Shiro, broke in: “I tell you what I thought when I saw that,” he said. “‘Just come home.’ Nobody wants to see their child struggle like that.”

Still, even though it saddens him that his kids seem to have fewer opportunities than he did -- his younger daughter has also had trouble finding good work -- Shiro said he could see the issue from the employer’s point of view. The 66-year-old retiree had watched House Foods Inc. (2810), where he worked his whole life repairing factory machinery, switch to part-timers to stay competitive.

“What KDDI was doing, it’s the way of the world,” he said. “In the larger sense, I understand it. It’s just that the way they went about it was extreme.”

Marui’s father didn’t draw a distinction between KDDI and its subsidiary.

Okinawa Move

KDDI Evolva shut the Tokyo call center in October 2010 and moved the business to Okinawa, where wages are the lowest in Japan. Marui and Mitomi were out of work.

They and seven other women filed suit against KDDI Evolva on Dec. 24 of that year -- “a little Christmas present,” said Mami Nakano, their lawyer. The suit demanded reinstatement and back pay for the difference between the operator’s wages and those of full-timers.

The crux of the case is that the women were kept on temporary contracts in order to limit their rights, not because their work was temporary, Nakano said. Lawyers for KDDI Evolva and KDDI, both named in the suit, declined to comment. KDDI Evolva filed court papers challenging the allegations.

On April 3, three years and four months after the case was brought, Tokyo District Court recommended a settlement: one year’s severance for each of the plaintiffs, Nakano said. For Marui, that’s about half the 4.9 million yen she requested.

Temporary Buffer

Courts are less protective of non-regulars employees, 68 percent of who are women, because they’re considered a buffer that helps preserve full-time jobs, said Machiko Osawa, head of the Research Institute for Women and Careers at Japan’s Women University in Tokyo. The law hasn’t caught up with the fact that many temps are the main earners for their families.

“It’s still assumed they’re dependent on parents or husbands,” said Osawa, who’s 2010 book “Working Poor, Japanese-Style” describes the rise of poverty in a society once known for its egalitarianism. “That means women are more vulnerable.”

It’s also one reason that the pay gap for Japanese women, who earn 29 percent less than men on average, is the second-widest among 28 countries tracked by the Organization for Economic Cooperation and Development, behind South Korea.

This year, Marui’s wage discrimination case has been followed by others, bolstered by changes to the contract labor laws in 2013.

On May 1, four women sued Tokyo Metro Co., the capital’s subway operator, for $425,000 in back pay and damages. A week later, three temporary workers at Japan Post Co. sued for violation of equal pay laws, saying their salaries were a third less than people doing identical jobs, and they weren’t paid allowances afforded to full-timers for holiday work.

Studio Apartment

After KDDI Evolva, Marui bounced among three more temporary jobs before landing at U.S.-based life insurer Aflac Inc. (AFL) It’s another contract position at another call center, but a step up because the pay is monthly instead of hourly.

That means her salary no longer shrinks during the holidays, and she has less worry about missing a day here or there if she has a cold. In February, Aflac gave her a year’s contract extension.

“That counts as super-long term in this day and age,” Marui said.

“When she came home for the holidays, she said she still had the same job as the year before,” her mother, Kumiko, said. “It was the first time that happened in a while.”

Marui lives alone in a studio apartment and spends her free time volunteering at an advocacy group for part-timers. In a way, staying single has given her the freedom to be an activist.

‘My Mission’

“If you’re responsible for a family, you have to keep quiet,” she said. “Part of me thinks this is my mission. Or maybe I’m just crazy.”

Asked how it is –- after the lawsuit and all the conflicts –- she can still find work, she laughed.

“If I were doing the hiring, I’d be looking into my background. But I guess because these aren’t full-time jobs, they don’t care who they hire,” she said. “They’re just looking for a body.”

Mitome is working at a call center for a mail-order catalog and lives with her 85-year-old mother in the house she grew up in.

“Really the only thing that’s come out of this is Marui’s friendship,” she said. “If we’d never met I don’t think either of us would have been able to fight like we did.”

To contact the reporter on this story: Jason Clenfield in Tokyo at jclenfield@bloomberg.net

To contact the editors responsible for this story: Peter Elstrom at pelstrom@bloomberg.net John Brecher

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