Further to our earlier rundown on the rather bleak outlook for investment bankers and staff at other financial institutions in Tokyo comes the intriguing – and perhaps, for rival firms, cautionary – tale of KBC Securities Japan, the Tokyo-based broker and branch of Belgian-owned KBC Financial Products.
Though tiny, with about 100 staff in Japan, KBC, like many of its rivals (both Japanese and foreign) , felt the need to downsize its presence in Tokyo – especially after poaching four (expensive) high-flyers from Nikko Citi last year, a move which insiders say strained the firm’s already stretched budget.
In early spring, KBC decided to lay off about 15 staff, across a range of areas from IT to equity research and sales. Earlier in the year, it relocated about eight people to Hong Kong, not all of whom stayed with the firm thereafter.
Unfortunately for KBC, it picked a group of staff – roughly half of them non-Japanese, mostly on local-hire terms – who were ready to fight back. And how.
Having turned to a powerful local union and tapped some high-level legal expertise, the group is understood to be preparing to take legal action in Japan – where labour laws are quite strict – and is even willing to take the case to Belgium, if necessary, claiming violation of workers’ rights.
Some people familiar with the case characterise the dismissal as a “drive-by shooting”, claiming some staff members were told in front of their colleagues to put their belongings in a bag and leave the premises.
KBC has now entered negotiations with the group and union representatives. When FT Alphaville called KBC to ask for the spokeswoman, we were told she was “no longer working here”. When we asked to be put through to the HR department, we were told “nobody is there” – the same answer we received in two subsequent calls.
One person familiar with the KBC case described Japanese labour law as “logical and humane”. Particularly in relation to restructuring and downsizing, he said: “Far too many foreign managers here run roughshod over Japanese law and behave as if they can apply their own country’s rules, but then have to backtrack. In the long run it’s more costly for them”.
We’ve got a good idea where to put our money in this battle.
Related links: The truth about Tokyo