Japan Responds to Allegations of Discrimination

Japanese companies in the U.S. have been criticized collectively for failing to hire minorities and women or to promote U.S. nationals to senior positions. For example, at recent Congressional hearings held by the House of Representatives’ Government Operations Committee on Japanese hiring practices, a U.S. national who had managed HR for a Japanese firm reported that he had been told to avoid hiring minority workers. In addition, a 1990 Japan Society poll found that more than 60% of U.S. nationals surveyed perceive U.S. firms as fairer than Japanese companies in their hiring and promotion of women and minorities.

Numerous antidiscrimination suits have been brought against Japanese companies by U.S. workers, and several have won their cases. However, a recent decision in favor of Matsushita Electric Company of America may reverse the trend. In December 1991, a federal court in Illinois decided that U.S.-Japanese trade treaties protect the company’s prerogative to replace managers who are U.S. nationals with Japanese expatriates on the grounds of citizenship.

Regardless, hiring women and minorities remains a difficult problem for many Japanese companies. Many HR executives say that their firms view EEOC regulations as meddlesome. “Unfortunately, Japanese companies haven’t been coping seriously with hiring minorities and women. Senior management in the Japanese headquarters hasn’t paid enough attention to the issue,” says Michito Ito, a partner in the New York City office of the law firm Morrison & Foerster, which has represented several Japanese corporations in labor matters. What’s more, she says that the recent Matsushita decision has caused confusion because it seems to reverse other U.S. legal decisions that punished Japanese companies for discriminatory hiring and firing. “In the long run,” says Ito, “the Matsushita decision doesn’t help us because it may make us unwelcome in American communities.”

Still, some Japanese companies are making the effort to hire and promote these groups out of fear of lawsuits or to improve their public image. In 1987, for example, Toyota U.S.A. initiated its TEAM (Toyota Equal Access for Minorities). Through the program, the company has provided management development to minority-owned vendors and dealers. At its plant in Georgetown, Kentucky, Toyota’s work force is 13% minority in a state in which minorities compose only about 7% of the population. Similarly, Hitachi America introduced its Action Program in 1985, which has spurred purchasing from U.S. vendors and has promoted U.S. nationals to executive positions. And since acquiring the Bank of California in 1984, Mitsubishi Bank has moved several women and minorities into executive positions.

Personnel Journal, November 1992, Vol. 71, No. 11, p. 35.