Top companies using banishment rooms to show employees the door

May 30, 2013

THE ASAHI SHIMBUN

With Japan's lifetime employment system in tatters, business circles are pushing to make it easier for companies to fire employees on full benefits who they view as lacking initiative and drive.

By the same token, companies, while keen to shed "redundant" employees, are reluctant to show them the door through outright dismissal.

The situation has given birth to so-called banishment rooms, where companies transfer surplus employees and give them menial tasks or nothing to do. Companies hope that targeted employees will become despondent and quit of their own volition.

Some big name companies have been found to operate banishment rooms. They include two subsidiaries of Panasonic Corp., Hitachi Ltd., Sony Corp., an NEC Corp. subsidiary, Toshiba Corp. and Seiko Instruments Inc.

The companies, however, deny they are exerting pressure on workers to resign by ordering them to perform menial tasks to hurry them out of the door.

The Asahi Shimbun recently learned that one of the two Panasonic subsidiaries also operates a section called "career development team" that a male employee said was just a fancy name for a banishment room, like the section known as the "Business & Human Resource Development Center" (BHC) at the companies.

"Employees come under enormous pressure to quit," said the man, who is in his 40s. "My section is simply another banishment room."

He was told his transfer was only temporary. That was four years ago. His main responsibility has been to find a new job via the Internet.

He was instructed to offer his assistance to another section that is busy.

In March, he was required to stare at a monitor for any irregularity in TV program footage for 10 hours at a stretch each day.

His boss told him he was lucky to still be on the payroll.

"Under normal circumstances, you should have been fired," his boss told him. "You ought to be grateful for being allowed to stay here and receive a salary."

The man built his career around planning in an Internet-related operation. But that window closed for him in 2008. He was unable to find a new position in or outside the company.

His employee performance evaluation was lowered year after year.

A bonus he received last year was a quarter of the sum he received five years ago.

The man said there were about 30 employees at his section, as of March.

A public relations official with Panasonic Corp.'s main office said, "The section is similar to the BHC in training employees to acquire new skills so they can work at different sections."

In April, the Panasonic subsidiary added 468 more employees to its BHC, most of them coming from sections that were performing poorly. It means that one in 10 workers at the company is with the BHC.

The expansion is aimed at "generating tangible results by securing a new source of income," according to employees, citing a management edict in March.

Internal documents obtained by The Asahi Shimbun show that there were 362 employees at the BHC last July, when it was established.

Thirty-five employees left the company, while 29 were transferred to other sections.

Rebounding from years of heavy losses, Hitachi is no longer in a situation in which it needs to implement large-scale cost-cutting.

In a recent interview, however, a Hitachi employee in his 50s said the ordeal he weathered over the past several months led him to believe he had been "singled out for dismissal."

"I feel like I was betrayed by Hitachi," the man said.

He recalled that his mind went blank when an instructor from a staffing agency spoke to him and 11 others from the company at the beginning of a two-week "career challenge program" last June.

"You are the ones who your company says are unnecessary," the instructor said. "You should find a different career path after taking this program."

The other participants, who are in their 40s and 50s, had worked in computer-related fields, where an increasing amount of production and programming work is outsourced.

The man was told to take the training course by his former boss.

After the session finished, the former boss summoned him and said: "We would like you to look for a new career path at a different company."

Thus his new routine began of going to a windowless room with only a desk and computer that was prepared by the staffing agency.

He looked for a job via the Internet and printed out his resume time and again.

An official with Hitachi's main office denied knowing of details of his situation.

"We have a program to prepare our employees for a life after retirement and to assist those who are opting for a career outside of Hitachi," the official said. "But few details of the program are available now."

The man felt he had a promising career ahead of him.

He was sent to study at a prestigious university overseas, the youngest Hitachi employee to do so at the time. The company clearly felt he showed promise.

After more than 10 interviews, the man landed a job with a midsize company.

A man with a software programing company within Konami Corp. is in the same boat as the former Hitachi employee.

He was told by his boss more than a year ago the transfer to the "career development section."

The man, who is in his 50s, stays home as his security pass to enter company premises was canceled.

He had been involved in the development of game software. The transfer came despite the parent company's robust sales of videogames in recent years. The man said few jobs are available for those older than 50 in the game industry.

"At our company, employees are expendable," he said.

In response to a request by The Asahi Shimbun for an interview, a publicity official at Konami said, "We cannot comment because the company structure is classified."

It is difficult to determine how widespread the practice of banishment rooms is in corporate Japan.

Business circles, meantime, have been clamoring for an overhaul of employment practices to make it easier for an employer to fire regular workers on grounds that companies need to move more swiftly to seize growth potential.

(This article was written by Takuro Chiba and Hisashi Naito.)

THE ASAHI SHIMBUN
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