The recent revelation of extremely severe conditions for workers at Sukiya should not be dismissed as an isolated case at the popular beef-bowl chain that rapidly expanded over a short period. Employers should view the case as a cautionary tale against pursuing maximum business efficiency through the minimization of manpower costs, and remind themselves of the importance of treating employees as key stakeholders in their business and of observing labor regulations.
The case of Sukiya, the nation's largest "gyudon" chain, attracted widespread public attention earlier this year when a mass exodus of workers forced the firm to temporarily shut down up to 10 percent of its roughly 2,000 outlets across the country. A third-party panel, appointed by the parent holding company of operator Zensho Co. to look into the work environment at the chain, said in late July that the chain had in fact suffered from chronic labor shortage for years — resulting in an excessively heavy workload on its staff.
Zensho Holdings Co. later announced that the mass closure of the outlets would force the group to report its first-ever loss in the year to March 2015. The company also said that by the end of September Sukiya will stop the practice of having only one employee run the graveyard shift at each outlet — a practice that symbolized the chain's business model of achieving low-cost operation by utilizing minimal staffing based on a strict calculation of sales per manpower input.