Closing the Representational and Organizational Gap in MSEs

A Case study in Japan

Reported by Naoko Otani

Introduction

This is a report of a case study of Federation of Workers‟ Union of the Burmese Citizens in
Japan (FWUBC) in the third phase of closing the representational and organizational gap in
MSEs.

FWUBC is an individual-based union. All members of FWUBC are Burmese and it is going to
organize Burmese workers in Japan so far. Majority of them work in restaurants in Tokyo and
the area near to Tokyo. According to the statistic1, there are around 10,000 establishments in
restaurant sector in Tokyo. (96%) of them are establishments employing less than 29 workers.
76% of them employ less than 9 workers. Thus, the restaurant sector is characterized as MSEs.
The second or third majority of Burmese workers in Japan work in manufacturing sector in
Gunma and Tokai area in which automobile manufacturers and suppliers are concentrated.

There are two types of trade unions in Japan. One is enterprise-based and the other is
individual-based. Enterprise-based unions are majority. In general, enterprise-based unions
organize regular employees. On the other hand, individual-based unions have been established
partly because the number of irregular workers has been increasing and partly because
labour-management relations have been individualized. Organizing irregular workers is fairly
under way2. For instance, the estimated unionization rate of part-time workers is 4.8% in 2007.
Aiming at strengthening collective bargaining powers of SME/MSE workers and irregular
workers, the national center RENGO establishes local unions under its local organizations in
which workers can individually join. There seems to be many challenges for individual-based
unions in terms of functions and operations including human and financial resources.

This case study tries to find out what kind of problems MSE workers have at work and what
kind of challenges individual-based unions confront with in practice.

1. Legal status of Burmese workers in Japan

According to FWUBC, some of Burmese workers have already acquired a long term residential
status by being recognized as refugee and others are asking for it. Briefly, I take a look(look) at
the legal status of Burmese workers in Japan.

Many of Burmese apply for asylum as refugee after entering into Japan3. If the Immigration
Bureau recognizes them as refugee, they acquire a long term residential status4. They are

1 MIC "Establishment and Enterprise Census"

2 RENGO-RIALS (2009) draws factors that unions organize irregular workers by interviewing.
3 According to a trade unionist who support FWUBC’s activities, if a refugee applies for asylum in

the validity period of his/her visa, he/she has an advantage over the permission of working.
4 There are cases that they acquire the status of residence of "Designated Activities”, if the

Immigration Bureau does not accept them as refugee. For detail, refer to
1
permitted to work in the country if they have the a long term residential status. However, in fact
it takes considerable time to recognize as refugee5. In principle, the Immigration Bureau does
not permit to work for foreign workers while it is in process to examine whether or not they are
refugees. Obviously, the foreign workers face on problems over how to sustain their lives.
According to trade unionists of JAM, the Immigration Bureau verbally responds to their
question that it will not punish an employer who employs foreign workers applying for asylum
as refugee6. This verbal statement is not authorized. In practice, employers easily dismiss
Burmese workers due to no residential status even if they are asking for asylum as refugee.

Speaking in relation to the Labour Standards Law, which regulates the minimum standards of
working conditions, foreign workers, who are employed in the country, are covered by the law
even if they do not have the authorization for employment.

2. Horizontal mapping

(1) Methodology
Interviewing is conducted by 15 FWUBC members. 25 unorganized Burmese workers respond
to the questionnaire.

(2) Results of interviewing

1) Profile of respondents
 Gender
Gender Frequency %
Female 6 24
Male 19 76
Total 25 100

Concerning gender, we have more male respondents than female ones. It could reflect that
there are less female interviewers.

 Age
Age Frequency %
20-29 years old 6 24
30-39 7 28
40-49 11 44
Over 50 1 4
Total 25 100
On average 37.9 years old

http://www.tfemploy.go.jp/index_en.html and http://www.immi-moj.go.jp/english/index.html

5 For example, a leader of FWUBC is in process of deliberation by the immigration bureau for more

than five years.

6 If a management employs a foreign worker without the authorization for employment, it is punish

according to the immigration law.

2
 Educations level
Education level Frequency %
Primary 1 4
Intermediate 2 8
Secondary 15 60
Vocational 0 0
Tertiary 7 28
Total 25 100

 Household size
Number of Number of Number of Number of
Household household household household
members in members members who members who
Japan (%) overseas earn an income earn an income
in Japan (%) overseas (%)
0 person 4 2 4 6
1 3 1 3 2
2 6 2 6 1
3-4 2 7 1 0
5-7 1 3 0 0
8-12 0 3 0 1
N.A. 9 7 11 15
Total 25 25 25 25
On average 1.3 4.3 1.3 1.7

At the first workshop, we decided to modify a question related to the household size in the
context of the actual situation of migrant workers and refugees. The number of household
members in Japan is 1.3 persons on average. Some respond to this question that he does not
have any household member in Japan if he lives alone while others respond that there is one
household member if he lives alone.

 Sector
Sector Frequency %
Restaurant 14 56
Manufacturing 8 32
Others 1 4
N.A. 2 8
Total 25 100

There are two main sectors in which respondents work ( for ). (14) respondents work in
restaurants. 8 respondents work in manufacturing sector. 8 people working in manufacturing
sector are all male.

3
 Type of employment
Employment type Frequency %
Part-time worker 17 68
Temporary agency workers 4 16
Trainee 3 12
Not identified 1 4
Total 25 100

In interviewing and analyzing, we tried to identify in which type of employment an interviewee

works as far as possible. Respondents work as part-time worker in restaurant sector while
respondents work as temporary agency worker and trainee in manufacturing sector.

The type of employment is relevant with the extent to which workers easily lose their jobs.
Regular workers are employed under the contract of employment without term in general. On
the other hand, irregular workers, such as part-time worker, contract workers and temporary
agency workers, are employed under fixed-term employment contract. Managements employ
irregular workers to make labour costs variable. They are first to be dismissed in downturns. In
addition, employers are not imposed to contribute social insurance and employment insurance
for irregular under some conditions while they are obliged to contribute the insurances if they
employ regular workers.

A “trainee” is a worker in the system of Industrial Training and Technical Internship Program
for foreigners7. A trainee could stay in Japan with trainee status residence for three years. In
terms of wage, a “trainee” is employed as trainee in the first, so that an employer should not pay
the payment more than minimum wage rate. As a “trainee” is regarded as a worker in the
second and third year, an employer should pay wage more than minimum wage rate. The aim
of the program is originally to transfer foreign workers technologies and skills
on-the-job-training. However, despite the aim, it is reported that employers, especially MSE
employers, abuse the program for employing trainees as cheap labour in fact.

 Type of job
Restaurant Manufacturing
Job type Frequency % Job type Frequency %
General helper 5 35.7 Trainee 3 37.5
Washing 4 28.6 Lower skilled 4 50.0
Hall staff 4 28.6 Higher skilled 1 12.5
Not identified 1 7.1
Total 14 100.0 Total 8 100.0

In restaurant sector, women work as hall staff while men work in kitchen. At the second
workshop, a couple of participants complain that they do washing dishes in kitchen of a
restaurant even if they have educations at university in Burma. At the same time, they indicate
that the vocational and educational program should be improved and open to migrant workers.
On the other hand, an interviewee could have training to attain a high qualification as welder
since an employer provides training program to him. He explains that an employer gives such
an opportunity to him because young Japanese do not want to work as welder any more,

7 http://www.jitco.or.jp/english/
4
otherwise the employer could not continue his business. His wage is relatively high because of
the qualification. However, he feels that he will lose the job as an assembly manufacturer is
going to insource in order to secure jobs for its own employees.

2) Employment situation
 Employment contract
Employment contract Frequency %
Verbal 4 16
Written 5 20
None 14 56
N.A. 2 8
Total 25 100

In terms of employment contract, the majority of respondents do not have any employment
contract with employers. This fact makes respondents be afraid that it would be easy to lose
their jobs. According to the law, an employer should have a written employment contract with
an employee. Even if the law regulates employers‟ obligation, employees are disadvantaged
without employment contract especially in case of labour dispute. Given this fact, FWUBC
encourages members to take a note about with whom they meet and what are explained on
working conditions when they have interviewing with a management8.

 Length of service

Correlation between length of service and hourly wage

2000
1800
1600
Hourly wage: yen

1400
1200
1000
800
600
400
200
0
0 2 4 6 8 10 12 14 16 18 20
Length of service: year

On average, the length of service is 3.4 years. There is a great difference from a month to 17
years and 8 months. The important point is that no matter how long they work in the same jobs,
their wages do not seem to increase. Possibly, it is partly because they are irregular workers. It
could also be taken into consideration that seniority payment is not usual in MSEs compared
to large enterprises. At any rate, irregular workers cannot easily access to educations and
training done by companies in general. Unless they participate in any educations and training
program, there are possibilities that they are fixed in low wage job.

8 According to RENGO-RIALS (2007), MSE workers do not know workers’ rights protected by the
labour laws compared to workers in larger sized enterprises.
5
 Would it be easy to lose your job?
Easy to lose a job Frequency %
Yes 18 72
No 6 24
N.A. 1 4
Total 25 100

18 interviewees respond that it would be easy to lose their jobs. Three of them are temporary
agency workers and have lost their jobs.

18 interviewees raise the reasons why it would be easy to lose their jobs as follows.
- Dismissal because of downturn in volume of order (2 persons)
- Because of temporary agency worker (3 persons)
- Undocumented/foreigner (5 persons)
- No official contract (3 persons)
- Part-time worker (2 persons)
- Three years contract
- Trainee
- Depend on chief

 Remuneration
Hourly earnings Total Restaurant Manufacturing
Frequency % Frequency % Frequency %
500-599 yen 1 4 0 0.0 1 12.5
600-699 2 8 0 0.0 2 25.0
700-799 0 0 0 0.0 0 0.0
800-899 2 8 1 7.1 0 0.0
900-999 5 20 5 35.7 0 0.0
1000-1199 7 28 4 28.6 2 25.0
Over 1200 4 16 1 7.1 3 37.5
N.A. 4 16 3 21.4 0 0.0
Total 25 100 14 100 8 100
On average 973.9 yen 947.9 yen 1009.4 yen

The average hourly earning is 973.9 yen. It is higher in manufacture than in restaurant sector.
This difference seems to result in the difference of working hour between these two sectors (see
Diagram “Working hours per day”). The fact is that the lower wages are in restaurant sector,
the longer hours workers have to work for in order to maintain their lives.

6
 Earnings per day Frequency %
4000-4999 yen 1 4
5000-5999 2 8
6000-6999 0 0
7000-7999 1 4
8000-8999 3 12
9000-9999 2 8
10000-11999 7 28
Over 12000 4 16
N.A. 5 20
Total 25 100
On average 9506.3 yen

More than Minimum wage rate Frequency %

Yes 15 60
No 5 20
N.A. 5 20
Total 25 100

In terms of minimum wages, (5) respondents give answers that their wages are less than
minimum wages. In examining data one by one, four of them seem to receive hourly wage more
than statutory minimum wage rates9. It is not sure which minimum wage they suggest. Rather,
it is more serious that three trainee workers receive wage less than the minimum wage rate.
They respond that they work in over one year. Even if they are trainee workers under the
system of Industrial Training and Technical Internship Program for foreigners, employers
should pay wage more than the minimum wage rate.

 Working hour/day
Working hour Total Restaurant Manufacturing
per day Frequency % Frequency % Frequency %
5 hours - 2 8 2 14.3 0 0.0
7- 2 8 0 0.0 2 25.0
8- 6 24 2 14.3 3 37.5
9- 2 8 2 14.3 0 0.0
10- 3 12 1 7.1 1 12.5
11- 3 12 2 14.3 1 12.5
12- 6 24 4 28.6 1 12.5
N.A. 1 4 1 7.1 0 0.0
Total 25 100 14 100 8 100
On average 9.5 hours 9.7 hours 9.1 hours

On average, working hours a week is 9.5 hours. Respondents in restaurant sector work for

9 They are two types of the statutory minimum wages, which are local minimum wage and
industry-specific minimum wage. In terms of local minimum wage, the highest hourly rate is 766
yen in Tokyo and Kanagawa prefectures while the lowest hourly rate is 627 yen in Miyazaki,
Kagoshima and Okinawa prefectures.
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 longer hours than in manufacturing sector. According to Monthly Labour Survey by MHLW10,
regular workers work for 8.3 hours per day on average. Compared to this data, the 9.5 hours
is at high level.

Working day per week Frequency %

4 days- 11 44
6- 11 44
7- 2 8
N.A. 1 4
Total 25 100
On average 5.6 days

3) Problems at work
 Do you encounter problems related to your work?
Categories of problems Yes (%) No (%) N.A.(%) Total(%)
Job security 8 (32) 5 (20) 12 (48) 25 (100)
Wages and benefits 5 (20) 16 (64) 3 (12) 25 (100)
Working hours 12 (48) 6 (24) 7 (28) 25 (100)
Social security/health insurance 3 (12) 13 (52) 9 (36) 25 (100)
Health and safety 9 (36) 11 (44) 5 (20) 25 (100)
Relationship with employer 10 (40) 12 (48) 3 (12) 25 (100)
Others 6 (24) 11 (44) 8 (32) 25 (100)

The half of respondents cites working hours as problems related to their work. As mentioned
above, it is assumed that long working hours is related to lower wage. In actual, some
participants point out that they have to work for long hours because their wages are relatively
low at the second workshop. However, only five respondents cite wages and benefits as problem
in the questionnaire. It might be because that they do not expect anything as long as they are
irregular workers, foreign workers, unqualified etc.

Ten respondents cite relationship with employer as problem related to their work. Three of
them had been fired at the moment of interviewing. Presumably, employers‟ behavior is prone
to be bossy 11 . There might be cultural and language barriers between employers and
respondents.

10MHLW stands for Ministry of Health, Labour and Welfare

11One of FWUBC leaders explains his experience. He works in a caterer’s shop. The owner told to
employees that it would not pay lamp sum as business conditions was getting worse. According to
him, there was an atmosphere in which it would be wrong for employees to go against the owner.
Usually, employees did not argue anything. But a occasion took place. A new head of chef publicity
argued to the owner that it could afford to pay lump sum to employees. He recognized that the
owner made a profit as he was even busier than usual. Such chef ’s response changed the
atmosphere and others. Eventually, lump sum was paid to employees.
8
 Who do you approach to seek help when you have work-related problems?
Whom to ask help Frequency (M.A.) %
Co-worker 3 24
Employer/owner/supervisor 2 8
Union 2 8
NGO 0 0
Church 0 0
Others 10 40
N.A. 9 36

4) Potentials for representation/organizing

 What do you think would encourage you to consider being organized?
Interviewees give answers below.
- Collective bargaining more effective
- Capability to help workers.
- Capability to stop exploitation.
- Capability to get help
- If FWUBC protects workers
- If FWUBC represents for me in case of any problems occurring at work

 What do you think would encourage your co-workers to consider being organized?
Interviewees give answers below.
- Raising working conditions
- Helping each other
- Standing for co-worker
- Helping with sympathy
- If a trade union protects workers
- If FWUBC union represents for me in case of any problems occurring at work

 Which problems or issues at work would be a good organizing theme?

Interviewees give answers below.
- Preventing unpaid wages
- Cooperation and mutual understanding
- Less paid
- Capability to stop exploitation
- Teaching workers' right
- If wage cannot be paid regularly, if an employer oppresses employees

 What do you think would be most appropriate form of organization for you?
Interviewees give answers below.
- An organization able to help me
- The government (3 persons)
- FWUBC
- We should know the main aim of a particular organization.
- Trade union

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 Would you consider being a union member?
To join in a union Frequency %
Yes 16 64
No 3 12
N.A. 6 24
Total 25 100

 If no, what would make you consider?

Interviewees give answers below.
- I don't want to give up my freedom to others
- I am a qualified welder. The owner is kind to me.
- Because the decisions are made by manager and boss.

(3) Recommendations for organizational strategies: FWUBC

At the second workshop, these points are recommended.
- Recruiting the unorganized by face to face is more needed.
- Periodically providing opportunities members and the unorganized to understand what a
trade union is.
- Periodically providing opportunities members and the unorganized to inform the labour
laws and health and social insurance. It is important to know workers‟ rights in order to
protect by themselves.
- Supporting members and the unorganized for stable employment. It is necessary to
provide a model of employment contract in the mother tongue. It is considerable to
implement free job placement services.
- Sharing experiences between each other on how to respond to and solve problems at work.
- Issuing a bulleting
- Strengthening the fiscal base of the organization (from Japanese trade unionists‟ point of
view)
- Democratically operating the organization
- Building networks with other trade unions, lawyers and doctors, etc.

3. Vertical mapping

(1) Manufacturing sector

There is a lot of literature on manufacturing industry, especially automobile and electronic
producers. In terms of SMEs/MSEs, the disparities compared to large enterprise were
discussed from viewpoint of dual structure from the end of WWII to the 60s and 70s. To reduce
the disparities, various measures were taken. The 80s and 90s, many of them explore why
production system including industrial relations in Japanese automobile industry make
profits 12 . Asanuma (1997) focuses on supplier system of production system. It explores
relationships between final product manufacturers and primary subcontractors to draw that it
is efficient for the system to share risks and create incentives of subcontractors to improve their
technologies in long-term relations. Ueda (2004) points out that transaction based on the
long-term relations has been weakening under globalization. It also shows that processing unit
cost is considerably decreasing in SMEs/MSEs. Assemblers and larger subcontracts are

12 See Womack et al. (1990), Coriat (1991), e.g.

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accused to flow mold drafts outside the country without noticing to subcontractors in the early
2000s.

Exposed to the changing transactional relationships, one of measures taken by SMEs/MSEs is

to cut labour costs by employing irregular workers, such as contract workers, temporary
agency workers and trainees.

(2) Restaurant sector

Trends of market size in restaurant sector

(mil,yen)

160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0
1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005

Source: Foodservice Industry Research

The number of restaurant and the share of joint-stock companies

900000 30
800000
25
700000
600000 20

500000
15
400000
300000 10
200000 Restaurant
5
100000 % of joint-stock companies

0 0
1978 1981 1986 1991 1996 2001 2004

Source: "Establishment and Enterprise Census"

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 The share of part-time workers by industry (2007)
Total Manufacturing Wholesale and Restaurant and
retail hotel
Part-time
workers (%) 19.6 13.9 32.1 48.9
Source: MHLW

The market size of restaurant sector has been shrinking and the number of restaurants has
been declining since the late 90s of recession period. On the other hand, the share of
joint-stock companies increases. This means that independent restaurants frequently close
their business because the management bases are fragile (Oda:2005). Presumably,
independent restaurants are prone to be smaller. In reflection of the competition for low prices,
the share of part-time workers is higher from other sectors.

Conclusion

In light of results of horizontal and vertical mapping and the workshops, these are pointed out
to prepare a draft action plan especially in terms of policy framework.

- Raising the minimum wages sharply. In setting the minimum wage rate at the council of
minimum wage, how much wages are revised in enterprises with less than 30 employees
is referred to as critical indicator13. This means that wages in MSEs are affected by the
minimum wage. Additionally, the level of minimum wage is less than the level of welfare
benefits.
- Improving the occupational training and education programs. The present subsidy
system of occupational training and education is employer-oriented. Although individual
workers can receive educational and training benefits, there are restrictions to apply for
them. The present system was built on the presumption of long-term employment. The
situation has been changing. Especially, irregular workers increase. They do not have
enough opportunities for training done by management.
- Frequently providing opportunities for workers to know the labour laws and workers‟
rights in way of user-friendly.
- Strengthening of penalties for employers against the labour laws and increasing the
number of labor standard inspectors
- Expanding coverage for unemployment insurance, health insurance, social insurance
and livelihood protection and applying them without exceptions
- Having a stronger network with lawmakers in order to improve refugees and migrant
workers‟ situation in Japan. Various measures are required (e.g. for improving Japanese,
providing apartments without discrimination)

13Employers assert that the extent of wage increase in 1-19 employees sized enterprises should be
taken as indicator in setting the minimum wage while trade unions insist that the extent in 1-99
employees sized enterprises should be taken at the national council of minimum wage.
12
Reference:

Asanuma, B. (1997) “Nihon no Kigyou-Soshiki Kakushinnteki-Tekiou no Mekanizumu

Tyouki-Torihiki-Kankei no Kouzou to Kinou ”
Coriat, B. (1991) “Penser a l‟envers. Travail et organisation dans l‟entreprise japonaise”

Oda, K. (2005) „Hennka-suru Gaisyoku-Sangyo no Yasai-Riyou‟ “Gekkann Yasai –Jouhou”

RENGO-RIALS (2007) “The 13th Questionnaire Survey on Work and Life of Workers”

RENGO-RIALS (2009) “Hiseiki-Roudousya no Soikika Tyoisa-Houkokusyo”

Ueda, H. (2004) “Gendai-Nihon no Tyuusyou-Kigyou”

Womack, J. P. et al. (1990) “The Machine that Changed the World”

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Appendix

Union density by Industry

Estimated union
Industry density
2007 2006
％ ％
Total 18.1 18.2
Agriculture 2.7 2.9
Mining 12.2 15.3
Construction 21.3 20.4
Manufacturing 25.2 25.5
Electricity, Gas etc. 59.4 56.8
Information 20.1 21.7
Transportation 26.8 26.8
Wholesales, retail 10.6 10.2
Finance and insurance 50.3 49.7
Real estate 2.8 2.6
Restaurant, hotel 4.1 3.7
Medical, care 8.5 8.6
Education 23.1 23.3
Mixture of services 40.7 44.9
Service 6.2 5.5
Public 44.0 50.0
Source: MHLW

Union Density of Part-time Workers

1993 2.0
1994 2.0
1995 2.1
1996 2.2
1997 2.4
1998 2.5
1999 2.5
2000 2.6
2001 2.7
2002 2.7
2003 3.0
2004 3.3
2005 3.3
2006 4.3
2007 4.8

Source: MHLW

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