Hidden pachinko industry workers make some noise

July 25th, 2011 by Philip Brasor & Masako Tsubuku

Getting paid: A patron exchanges prizes for cash outside a pachinko parlor

Pachinko isn’t the huge money maker it used to be. At around the turn of the century, it was a ¥30 trillion a year business, putting it on the same revenue level as medical care, but according to the Nihon Yugi Kanren Jigyo Kyokai, the pachinko industry association, pachinko parlors now pull in about ¥10 trillion less, give or take a few trillion. Ten years ago there were about 17,000 parlors nationwide. Now there’s only about 12,500.

Unlike horses and certain other racing sports, pachinko is not approved by the government for gambling purposes, but the industry has traditionally gotten around this obstacle by offering prizes to winners. These prizes can then be exchanged for cash at secretive little booths (keihin kokan-jo) located outside the premises, since having the booths inside the parlors themselves would be against the law. The businesses that run the booths sells the prizes to a wholesaler who then redistributes them back to pachinko parlors.

Organized crime elements used to be centrally involved in this buy-back cycle, but in the early ’90s the police managed to lock them out of it and set up their own organizations to administer the business. It’s been reported in the past that a portion of the money these schemes make go to the National Police Agency for things like pension funds. A prepaid card system for pachinko parlors was introduced in the ’90s that made it easier for the police and tax authorities to monitor revenues.

Recently, some of the employees who staff Osaka’s prize-exchange booths have bucked convention and demanded a pay raise, thus bringing the rather shadowy buy-back system out into the light. On July 15, 560 of these women went on strike for 24 hours, demanding a wage increase from ¥1,010-an-hour to ¥1,100-an-hour. They say they will continue to stage occasional strikes until their demand is met.

The strike is interesting enough in and of itself to have attracted widespread media attention, but what makes it even more meaningful is that the target of the action isn’t only the pachinko industry, but also a welfare organization. Technically speaking, these women — and they’re all women — aren’t employed by the keihin kokan-jo, which are for legal purposes distinct business entities unrelated to the parlors they serve, but rather by Zaidan Hoshi Osaka Shogaisha Boshi Kafu Fukushi Jigyo Kyokai, a foundation established in 1961 to help “the disabled, singles mothers and widows” in Osaka.

These three demographics have always been socially disadvantaged, and single mothers have stereotypically been employed primarily in two occupations in the past: bar hostess and pachinko parlor employee, which is preferable because parlors usually also offer room and board. One of the foundation’s jobs is to find work for these women, and sometime in the past the Osaka chapter of the above-mentioned pachinko industry association made a deal with the foundation to supply employees who would staff the prize-exchange booths. They’ve been doing it ever since. That means the foundation acts as an ukeoi (contractor), much the same way a temp agency does. In that regard, the women take their orders not from the pachinko association but from the foundation.

So when the women decided they wanted more money, they didn’t go to the foundation, but rather to three Osaka chapters of national labor unions. According to the Asahi Shimbun, until 2004, “regular employees” of these prize-exchange booths received salaries of ¥220,000-a-month, but thereafter the pachinko association started paying the foundation less for each employee, with the result that they ended up with ¥180,000-a-month. This pay is for full-time employees, but the reduction in hourly pay for part-timers was roughly equivalent. Three hundred of the women now belong to the Osaka chapter of Rengo, whose chief told the Asahi, “Many of these women have to work two jobs to make ends meet, and the pachinko industry takes advantage of that situation knowing they can’t afford to quit. If we remain silent the industry will continue stepping all over them.”

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