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Olympus Whistleblower Sidelined Despite Court Ruling

Wed, 07/11/2012 - 10:05am
Yuri Kageyama, AP Business Writer

TOKYO (AP) — An employee at Japanese medical equipment maker Olympus said Wednesday that his humiliating treatment has not changed despite a Supreme Court ruling that his demotion for whistleblowing was illegal.

Masaharu Hamada said he is still isolated in the office and after last month's court judgment is not given any work. His was the first whistleblower case to reach Japan's highest court.

His lawyer Koichi Kozen said Hamada may have to file another lawsuit, complaining of human rights violations. Japan remains behind Western countries in penalizing companies that fail to abide by court rulings, and some fines are so small companies would rather pay up than abide, Kozen said.

"We would hope the company would respond quickly, but there has been no response," Kozen said. "We want Mr. Hamada to get a new assignment, where he can be happy."

Hamada, 51, an Olympus salesman with experience in the United States, first sued in 2008, alleging punishment for relaying a supplier's complaint.

He is considered a whistleblower in Japan because he raised questions about colleagues' professional behavior and was subjected to bizarre and humiliating punishment, such as taking rudimentary tests.

Tokyo-based Olympus said it took the June 28 ruling seriously and is in talks with Hamada on the best role for him in the company.

"A transfer takes some time," said company spokesman Tsuyoshi Oshima, while declining to give details of the talks. "We are doing our best to respond as soon as possible."

Hamada has repeatedly said he wants to be transferred to Olympus' corporate compliance section where he says his court experience in labor rights will be a plus.

Last year, the Tokyo High Court reversed an earlier district court decision and ordered Olympus to pay Hamada 2.2 million yen ($28,000) in damages for his demotion. Olympus had appealed. The Supreme Court dismissed Olympus' appeal, handing a "salaryman" a rare victory in a corporate culture that values unquestioning loyalty in return for lifetime employment.

A law to protect whistleblowers was enacted only in 2006 in Japan, and critics say it is inadequate because it does not penalize companies that punish whistleblowers. To pursue legal action, whistleblowers can't quit as the law only applies to employees.

Only a handful of whistleblowers have come forward in the past few decades. When they do, they are treated as outcasts, sometimes being told to sit in closet-sized offices or to mow the lawn.

One high-profile whistleblower at Olympus fared better.

Michael Woodford, the former British chief executive, won a 10 million pound (1.2 billion yen, $15.4 million) settlement from Olympus in a British court. He had sued alleging unlawful dismissal and discrimination as he was not given the same treatment as a Japanese employee. He was fired in October after he blew the whistle on dubious accounting at Olympus.

Hamada said his section boss told him his situation was not his problem because the Supreme Court ruling meant Hamada should not be in his department. Hamada said his nameplate vanished from the office.

He said he will continue to fight his legal battle, including suing again, not just for his own rights but for other whistleblowers, who may come after him.

"If I give up now, it's as though they won," said Hamada. "We won in the Supreme Court. And that's important."

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