Econ­omy pays tab for free lunch on over­time

Gov­ern­ment fig­ures on long, un­paid hours are un­der­es­ti­mat­ing the prob­lem, says sur­vey

China Daily (Hong Kong) - - WORLD - By REUTERS in Tokyo

Ja­panese work­ers put up with long hours and un­paid over­time un­der pres­sure from cost-sav­ing com­pa­nies, and fig­ures from gov­ern­ment, which wants more money in work­ers’ pock­ets to boost con­sumer spend­ing, ap­pear to un­der­es­ti­mate the prob­lem.

Prime Min­is­ter Shinzo Abe is try­ing to en­act la­bor re­forms as part of his “Abe­nomics” plan to end decades of stag- nant growth and de­fla­tion. His pro­pos­als in­clude mea­sures to cut work­ing hours and limit over­time, raise wages for tem­po­rary work­ers and make things eas­ier for em­ploy­ees with chil­dren.

By law, both man­age­ment and rank-and-file em­ploy­ees should get paid for ex­tra work, but com­pa­nies have been dis­cour­ag­ing over­time claims for so long that em­ploy­ees ac­cept it as nor­mal.

Gov­ern­ment data shows that Ja­panese work an av­er­age of 14.2 hours of over­time a month, but 2,000 re­spon­dents in a re­cent sur­vey by the Ja­panese Trade Union Con­fed­er­a­tion said they worked an av­er­age of 40.3 hours of over­time a month, and get paid for just 22.7.

“Work­ers often face pres­sure from their su­pe­ri­ors, some­times in sub­tle, un­spo­ken ways, to claim less over­time hours than ac­tu­ally worked,” said Toshi­aki Mat­sumoto, chief ex­ec­u­tive of HR Strat­egy, a hu­man re­sources con­sul­tancy.

A def­er­en­tial work cul­ture means few speak up.

“Often I don’t bother claim- ing over­time be­cause my projects would run over bud­get, and that would hurt my chances for pro­mo­tion,” said one 38-year-old IT en­gi­neer who asked not to be named for fear of up­set­ting his boss.

He es­ti­mates that he works an av­er­age of 50 un­paid over­time hours a month, often leav­ing the of­fice at 8 pm, spend­ing some time with his wife and 3-year-old son be­fore bed, then get­ting up at 3 am to tackle un­fin­ished work.

A 26-year-old Tokyo man who works in sales at a steel trad­ing com­pany said his em­ployer reg­u­larly pres­sured work­ers into re­duc­ing hours on their over­time forms. In busy times he works from 7 am to mid­night, plus Satur­days.

“The amount of over­time has left me ex­hausted,” he said.

At times, the pun­ish­ingly long hours can have tragic con­se­quences.

The sui­cide of a 24-year-old ad agency worker who clocked up 105 hours of over­time in the month be­fore she fell into de­pres­sion was last month ruled “karoshi”, or death by over­work.

Abe’s pleas for busi­nesses to put up wages to kick­start the econ­omy have largely fallen on deaf ears. But if the re­sults for the sur­vey are ex­trap­o­lated na­tion­wide, just pay­ing em­ploy­ees for the hours they work could push up con­sumer spend­ing by 13.4 per­cent, ac­cord­ing to Reuters cal­cu­la­tions based on monthly wage data.

“It’s a prob­lem if you’re work­ing long hours and not get­ting the com­pen­sa­tion you’re en­ti­tled to,” said No­rio Miya­gawa, se­nior economist at Mizuho Se­cu­ri­ties, adding that work­ing long hours also meant peo­ple didn’t have time to go out and spend.

In an era of weak global de­mand and un­cer­tainty about eco­nomic prospects, Ja­panese com­pa­nies have been hoard­ing cash rather than shar­ing it with the work­force.

Since Abe took of­fice in late 2012, re­cur­ring profits have gone up 62.3 per­cent, but staff com­pen­sa­tion has grown a miserly 2.1 per­cent. House­hold spend­ing has risen just 1.6 per­cent dur­ing the same pe­riod.

“Com­pa­nies are with­out a doubt rob­bing work­ers of their wages and free time,” said Toko Shi­rakawa, a visit­ing pro­fes­sor at Sagami Women’s Univer­sity and a mem­ber of the gov­ern­ment’s work cul­ture panel.

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