Labor union’s veto over company split

In Japan, according to Companies Act and Act on the Succession to Labor Contracts upon Company Split, companies may effect company split without the agreement of labors who will be transferred.

Sotetsu is one of major railway company and their management is in crisis, so they are planning to effect company split which means railway business will be divided.

But Sotetsu Labor Union, one of labor union of Sotetsu, insists that they have a veto power over company split and plans to strike.

Basis of their claims is union contract.

Union contract between Sotetsu and Sotetsu labor union has prior consultation clause which demand company to have a discussion when company plans to change working condition.

The union’s claim seems unreasonable because prior consultation clause does not mean veto power. It only demands to have a discussion.  

7-eleven to pay 15% of franchisees’ expired food costs

June 23, 7-eleven announced that they are going to pay 15% of their franchisees’ costs of expired food.

According to their contract, the costs of expired food are franchisees’ charge.

So, 7-eleven's discount banning is imposing a huge costs of expired food on franchisees.

This means 7-eleven admitted part of their doings are unfair, but  JFTC’s order is threat to their business because JFTC orders to cease discount banning entirely, so they may appeal to JFTC.

JFTC ordered 7-eleven to cease discount banning

June 22, JFTC ordered 7-eleven to stop prohibiting its franchise stores from offering discounts.

According to JFTC’s release, though franchisee may price their items in 7-eleven’s  franchise contract, 7-eleven controls the price of franchise stores in fact.

JFTC said it was abusing franchiser’s position of superiority and illegal.

Shareholders’ rights after stocks became paperless

This January, stocks became paperless in Japan.

After that, the perfection of transfer of shares was changed from shareholders registry in the company to the registry of Japan Securities Depository Center.

So, shareholders need to ask securities company send the shareholders’ certification  to the company when shareholders submit proposals at the shareholders meeting.

But this change was not well known so quantity of shareholders proposals are less than usual this year because of complexity of procedure.  

Demotion after maternity and child care leave

June 16, a woman worker who returned to work after maternity and child care leave filed a suit for the wages which her company reduced and  declaratory judgment which says her company’s treatments were illegal.

The company which she is working for is Konami Digital Entertainment Co., Ltd. ,one of major videogame maker in Japan.

Konami Digital Entertainment demoted  her from international business to domestic business after maternity and child care leave. As a result her wages were reduced.

Konami Digital Entertainment says they reduced her work for her child care.

Aderans abandoned takeover defence

June 18, Aderans’ board of directors resolved to abandon their takeover defence.

After Shareholders’ meeting, Steel Partners dominated Aderans’ management, previously, Steel said Aderans should abandon takeover defence because it damaged the corporate value.  

So board of directors responded to the demand.  

NIPPONKOA’s oppression

June 12, NIPPONKOA Insurance Company, Limited announced that they will not file an action for pursuing the liability of their directors.

One of their share holders who is former NIPPONKOA’s director demanded them to file the action.

He said present directors intentionally did not pay the insurance and  padded the profit of the company.

But NIPPONKOA said such facts are not and rejected the demand.

According to Companies Act, after company’s reject, shareholder may file an action on behalf of the company, so, in this case, he will file an action.

NIPPONKOA is planning to be merged with Sompo Japan Insurance Inc. , major insurance company in Japan.

This may be an obstacle to the merger.