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Ex-insurance salespeople take action against employers over low pay

The Central Government Building No. 5 in Tokyo's Chiyoda Ward that houses the Health, Labor and Welfare Ministry is seen in this file photo taken on Oct. 14, 2015. (Mainichi)

TOKYO -- At least 12 former insurance salespeople are either suing their previous employers or seeking a decision by a labor tribunal over a total of some 63 million yen including unpaid salaries, a Mainichi Shimbun investigation has found.

The 11 plaintiffs taking their cases against the three employers to six district courts nationwide and one seeking a labor tribunal decision say that they were forced to work at unfairly low pay as large amounts of expenses were deducted from their salaries.

A lawyer handling labor issues warns that "part of the (insurance) industry is exploiting workers." A group of lawyers is planning to set up a national organization to support victims of what they see as exploitative employers.

The legal cases are being handled by district courts in Sapporo, Tokyo, Osaka, Hiroshima, Nagasaki and the Kokura branch of the Fukuoka District Court. The 12 people, who had worked for their former employers between nine months and three years and three months, are seeking between 700,000 yen and 20 million yen each. Several more people are expected to file similar suits in Sapporo, Tokyo and Hiroshima, among other regions.

According to their lawsuits and other information, the plaintiffs joined their companies under the condition that they would be given a "base pay" of over 100,000 yen per month, but only parts of the promised payments were made. Moreover, their employers forced the plaintiffs to pay hundreds of thousands of yen in "information fees" about potential customers every month.

The plaintiffs' payments were calculated by deducting expenses including information fees from commissions paid from insurance companies to their sales agencies. There were months when there was almost no pay, or some occasions when even expenses exceeded payments and the difference had to be shouldered by the employees. Some people were forced to cover social insurance premiums that should have been paid by the employers.

Lawyer Taku Nakagawa, who represents a plaintiff in Nagasaki and plans to join the nationwide group supporting similar victims, accused the employers of "pressing the costs the companies are supposed to pay onto workers."

The three employers sued by the plaintiffs are insurance agencies for multiple insurance companies. One of them has a national operation with at least 1,000 salespeople. When contacted by the Mainichi the three companies refused to comment.

An official of the Financial Services Agency (FSA), which oversees the insurance industry, said, "We cannot make a judgment because it is a labor problem. We will respond when a problem arises for insurance contracts with customers." A Ministry of Health, Labor and Welfare official said the ministry "will respond properly when labor standards inspection offices are consulted."

Professor emeritus Shigeru Wakita, a labor law specialist at Ryukoku University, commented that the labor ministry should conduct a survey on the industry and guide insurance agents properly. "It is possible that some insurance agencies are making employees work under conditions that breach labor laws, such as forcing them to work for less than the minimum wage or taking large deductions from their salaries," said Wakita. "The work practice may cause irregular insurance contracts, and the FSA should oversee the industry properly."

(Japanese original by Takeshiro Higuchi, Kyushu News Department; Tetsuo Hatakeyama and Shusaku Sugimoto, Special Reports Group)

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