Four temporary staffing agencies in three prefectures have been accused of evading more than 300 million yen in consumption tax by establishing dummy companies to which they pretended to outsource job placements, The Yomiuri Shimbun learned Thursday.
The revelation comes at a time when the national tax authorities have been stepping up investigations into evasion of consumption tax due to the public’s high interest in the tax, which accounts for about 20 percent of the total state tax revenue.
Three of the four job placement agencies are located in Hadano and Ebina, Kanagawa Prefecture, and in Numazu, Shizuoka Prefecture, and are operated under the same name, AA TOPIC. The other agency is located in Osaka Prefecture.
The Tokyo and Nagoya regional taxation bureaus have filed a tax evasion complaint with the Yokohama and Shizuoka district public prosecutors offices against the three firms and their former president, Tomoyuki Sato, 48.
The three companies allegedly made it appear that they had dispatched personnel to clients through dummy outsourcing firms though they actually sent their employees directly to the clients, thereby evading consumption tax totaling about 230 million yen over four years until the business term ended in March last year.
They allegedly repeated the practice of establishing and liquidating dummy outsourcing companies to conceal instances of tax evasion.
According to a private credit research company, the three companies sent about 1,000 temporary factory and clerical workers to major carmakers and precision machine makers in Kanagawa and Shizuoka prefectures.
An executive of the Numazu company, whose name has been changed to Area Staff, admitted that the company had been investigated for tax evasion, but would not elaborate, saying, “Only former President Sato knows the details.”
The special investigation squad of the Osaka District Public Prosecutors Office has arrested Seiji Fujiwara, 48, president of job placement company Interu in Tadaokacho, Osaka Prefecture, on suspicion that the company evaded a total of about 82 million yen in consumption tax.
The Osaka Regional Taxation Bureau has joined the prosecutors office to conduct a probe into the case.
According to the investigation, the company dispatched its employees to a pachinko parlor for three years until the business term that ended in June 2005, but it evaded payment of the due consumption tax by making it appear that it outsourced the dispatch of temporary staff to a dummy job placement firm.
Dispatch
Recruiter held over dispatch of trainee
Police on Wednesday arrested the representative director of an Okayama-based recruitment cooperative on suspicion of illegally dispatching an Indonesian trainee to an unauthorized local factory.
The Okayama and Hiroshima prefectural police jointly began investigating Keisuke Tsuruno, 60, the representative director of Sanyo Intec, earlier in the day on suspicion of violating the Immigration Control and Refugee Recognition Law.
According to the police, the Indonesian trainee was accepted by the cooperative under the government-run foreign trainee system in October. Tsuruno then dispatched him to the factory to work, although it was not a training site designated under the system.
Osaka Labor Bureau probes Yamada Denki
The Maebashi-based firm, one of the nation’s largest consumer electronics retailers, is suspected of ordering the salespeople to confirm and promise to follow 35 instructions on a checklist at the Labi 1 Namba outlet in Naniwa Ward, Osaka.
The labor bureau will clarify the circumstances surrounding the dispatched salespeople.
The outlet has not revealed how many salespeople were dispatched by the electronics manufacturers. However, The Yomiuri Shimbun discovered at the end of last year that at least 60 dispatched salespeople were working at the outlet at the time.
According to sources, the outlet gave each of the salespeople a checklist on their first day of work, including instructions concerning dress code and breaks. The salespeople were also required to brush up on other popular home electric appliances manufactured by rival firms.
The dispatched salespeople were asked to confirm each item on the list by checking it off. They then had to sign their names and put their seals on a printed statement agreeing to follow the instructions and work to the best of their ability.
The labor bureau felt the checklist was evidence the outlet supervised salespeople who were not contracted to the firm.
Japan Mulls Importing Foreign Workers
The prospect of a shrinking, rapidly aging population is spurring a debate about whether Japan is so insular that it once barred foreigners from its shores for two centuries should open up to more foreign workers.
Japan’s 2 million registered foreigners, 1.57 percent of the population, are at a record high but minuscule compared with the United States’ 12 percent.
For the government to increase those numbers would be groundbreaking in a nation conditioned to see itself as racially homogeneous and culturally unique, and to equate “foreign” with crime and social disorder.
“I think we are entering an age of revolutionary change,” said Hidenori Sakanaka, director of the Japan Immigration Policy Institute and a vocal proponent of accepting more outsiders. “Our views on how the nation should be and our views on foreigners need to change in order to maintain our society.”
Schooling is compulsory in Japan until age 16, but only for citizens. So foreign kids can skip school with impunity. Arrangements such as special Japanese classes for newcomers are ad hoc and understaffed. Many of the foreigners [are illegally denied] pensions or the same health benefits as Japanese workers because they’re hired through special [and for the most part, illegal] job brokers.
The population is 127 million and is forecast to plunge to about 100 million by 2050, when more than a third of Japanese will be 65 or older and drawing health and pension benefits. Less than half of Japanese, meanwhile, will be of working age of 15-64.
Fearing disastrous drops in consumption, production and tax revenues, Japan’s bureaucrats are scrambling to boost the birthrate and get more women and elderly into the work force. But many Japanese are realizing that foreigners must be part of the equation.
Few support throwing the doors wide open. Instead, they want educated workers, engineers, educators and health professionals, preferably arriving with Japanese-language skills.
Corporate leaders are prime movers. “We can create high-value and unique services and products by combining the diversity of foreigners and the teamwork of the Japanese,” said Hiroshi Tachibana, senior managing director of Japan’s top business federation, Keidanren.
But government officials are so touchy about the subject that they deny the country has an immigration policy at all, and insist on speaking of “foreign workers” rather than “immigrants” who might one day demand citizenship.
Immigration in Japan does not have a happy history. The first wave in modern times came a century or more ago from conquered lands in Korea and China, sometimes in chains as slaves. Those still here the largest group being Koreans and their descendants still suffer discrimination and isolation.
Even today, the policy seems to lack coherent patterns. In 2005, for instance, about 5,000 engineers entered Japan, along with 100,000 “entertainers” _ even after that vaguely defined status was tightened because it was being used as a cover for the sex trade and human trafficking.
“Everybody, I think, is agreed on one thing: We want to attract the `good’ foreigners, and keep out the `bad’ ones,” said Hisashi Toshioka, of the Justice Ministry’s Immigration Bureau.
http://www.cbsnews.com/stories/2007/01/20/ap/world/mainD8MP5VG00.shtml
Japan salvages its older workers
Fears of a labour crunch and a deficit of skilled workers are growing in Japan as baby boomers start hitting the standard retirement age of 60 this year, in what Japanese media have dubbed the “2007 problem”.
A decline in numbers of young workers is exacerbating the concern as the population ages at an unprecedented pace.
Japan’s proportion of people older than 65 is already the world’s highest at 20 per cent of 127 million. The figure is heading for 40 per cent by 2055…
Hidemitsu Sano, head of staffing agency Fancl Staff, hopes to expand job placements for retirees, but says companies may turn to other sources of labour in the future.
“There are only four solutions to a labour shortage in Japan – the elderly, women, NEETs and foreigners,” he says. After that, it’s robots.
http://www.theaustralian.news.com.au/story/0,20867,21004356-643,00.html
A mobile, disposable work force
Indications of deteriorating working conditions are coming to light at workplaces across the nation as the result of a practice that has become a social issue: More and more manufacturing companies are bringing in contract workers (ukeoi) to have them work like temporary workers (haken) — as if dispatched from staffing agencies — but without haken benefits.
For laymen, the legal difference between these two types of workers is a bit hard to understand.
But the practice not only is illegal and responsible for low wages — usually about half or less of regular-employee wages — but also leads to worker instability. Companies should quit the habit, and the labor standards inspection offices should crack down on violators.
Hello Work violated temp staff law
Sixteen Hello Work job-placement offices under the jurisdiction of the Health, Labor and Welfare Ministry’s Osaka Labor Bureau have allowed employees from two organizations to engage in work performed by Hello Work offices, The Yomiuri Shimbun learned Tuesday.
The employees of the Employment and Human Resources Development Organization of Japan (EHDO), an independent administrative institution in Yokohama, and the Association of Employment Development for Senior Citizens (JEED) in Tokyo, reportedly engaged in such duties as reception work and counseling for job-seekers on behalf of the Hello Work employees.
Treating employees from the two organizations as temporary workers for Hello Work without any contracts violates the Temporary Staffing Services Law. However, it has become a common practice…Hiroyuki Ito, of the bureau’s employment security section, said the incident was regrettable because office employees lack awareness of the law, although they work for public offices responsible for labor issues.
Ratio of dispatch workers to regular employees rises to 12.4%
The ratio of dispatched workers to regular corporate employees in Japan came to 12.4% last year, more than double the figure eight years ago, a government survey showed Monday. The data, compiled by the Health, Labor and Welfare Ministry, indicated corporate Japan is increasingly incorporating temporary workers to cut personnel costs following 1999 deregulation in the labor dispatch service field.
Firm punished over staff dispatch
The Osaka Labor Bureau slapped major subcontractor Collaborate Co. with a business suspension Tuesday for illegally sending its employees to clients as de facto temp staff.
The Workers’ Dispatch Law prohibits the practice, which amounts to subcontractors acting as temporary staff agencies.
It is the first time in Japan for a company to be told to actually close shop temporarily as punishment for the illegal practice.
http://www.asahi.com/english/Herald-asahi/TKY200610050134.html
Temp staff violations to lead to suspension
A major Osaka-based subcontractor is facing a business suspension order after it continued to dispatch temporary staff in violation of the Workers’ Dispatch Law, sources said.
They said the suspension order, to be served as early as this week, will cover all 84 offices of Collaborate Co., and will likely see the manufacturing subcontractor’s business activities halted for a two-week period.
The Ministry of Health, Labor and Welfare decided to go ahead with the measure after Collaborate ignored repeated requests to stop dispatching temp staff under the guise of subcontracted workers.
In recent years, a growing number of manufacturers has been found accepting workers on a subcontracted basis as a way to skirt employment-related responsibilities, particularly in regard to safety and supervision.
Furthermore, if labor is brought in through temporary staffing agencies, manufacturers are legally obliged to offer the workers full-time working contracts after a certain period of employment.
Under the Workers’ Dispatch Law, subcontractors are prohibited from supplying manpower to firms with which they have agreed to provide services or materials to meet other contracts.
http://www.asahi.com/english/Herald-asahi/TKY200610020098.html