June 26, 2008

Goodwill to Ax Day-Laborer Business

By The Yomiuri Shimbun

Jun. 25--TOKYO -- The Goodwill Group Inc. has decided to shut down its subsidiary Goodwill Inc., a major day-laborer dispatching agency, sources said Wednesday.

The group's decision came after the Tokyo Summary Court ordered Goodwill Inc. and three of its employees to pay fines on Tuesday for illegally redispatching temp staff.

The group plans to start taking the necessary procedures to liquidate the subsidiary soon and completely withdraw from the day-laborer dispatching business, according to the sources.

The Health, Labor and Welfare Ministry had already made clear its plan to revoke the company's license as a temp staffing operator if it were found guilty by the court.

The three employees had been arrested earlier this month on suspicion of assisting the illegal redispatching of temp staff to different workplaces.

On Tuesday, the Tokyo District Public Prosecutors Office brought the case against the subsidiary and its three senior managers before the summary court, which reached a decision the same day, ordering the company to pay ¥1 million and the three employees ¥500,000 each in fines. The fines were also paid the same day.

Should either party be dissatisfied with the summary court decision, a request for a formal trial could be made within two weeks. Otherwise, the court decision will be finalized.

The Health, Labor and Welfare Ministry's stance to revoke the firm's operation license if found guilty apparently led the firm's parent company to conclude it would be difficult to continue in the day-laborer dispatching business.

The Temporary Staffing Services Law stipulates that if a temp staff agency is found guilty of violating a labor-related law, its license can be revoked.

Though Goodwill Inc. previously dispatched about 30,000 workers a day, the number plummeted to 7,000 a day recently after the firm briefly suspended its business in line with a ministry order due to the illegal dispatching of workers in a number of cases.

The temp agency is believed to be trying to find a company willing to accept the workers registered with the agency, according to sources close to the company.

The Goodwill Group comprises Goodwill, Ctech, Inc. and TechnoPro Engineering, Inc. The two other companies dispatch engineers to manufacturers and other companies.

In its business policy announced in May, the Goodwill Group revealed a plan to scale down the size of its day-laborer dispatching business, while boosting its engineer staffing service. The dispatching of engineers has a higher profit margin than that of other temp workers.

Health, Labor and Welfare Minister Yoichi Masuzoe announced a plan on June 13 to revise the Temporary Staffing Services Law with a view to banning the dispatch of day laborers in principle.

Such a move is likely to significantly shrink the overall scale of the temp staffing industry.

According to the indictment in the summary court, between May 2006 and June 2007, Goodwill dispatched 51 workers to Towa Lease, a cargo handling firm in Minato Ward, Tokyo, even though it was aware Towa would illegally redispatch them to two other firms.

The firm also failed to clearly inform 54 of the workers it dispatched to Towa of the details of the jobs they were to undertake and their working conditions, according to the indictment.


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