What Should You Be Aware of When Signing Employment Contracts for the Expanding 'e-Sports' Job Market?

Since around 2018 (Heisei 30), the e-sports market in Japan has been rapidly expanding. Major corporations are entering the field, and the excitement is expected to continue to grow.

Traditionally, the involvement of corporations in e-sports has primarily been as sponsors of teams and tournaments. However, recently, there have been cases of IT companies with deep ties to the gaming industry hiring e-sports players as employees.

Therefore, for companies considering job postings in the e-sports category, we will explain what points to be aware of in the recruitment activities of e-sports players and their treatment after hiring.

Please note that we also provide detailed explanations about the general involvement of companies in e-sports, not limited to the ‘e-sports category’, in the following article.

https://monolith.law/corporate/esports-legal-barriers[ja]

The Significance of Companies Establishing an eSports Division

eSports, or electronic sports, refers to competitive computer gaming. Originally, the eSports market expanded primarily in the West, but in recent years, it has also gained popularity in China and South Korea.

Compared to the rest of the world, Japan was a latecomer to eSports. However, since around 2018, issues of conflict with Japanese laws such as the ‘Japanese Act against Unjustifiable Premiums and Misleading Representations’ have been resolved, leading to the hosting of major eSports tournaments in Japan and an increase in the number of eSports players.

We have detailed explanations about legal risks related to eSports, such as the ‘Japanese Act against Unjustifiable Premiums and Misleading Representations’, in the following article.

https://monolith.law/corporate/esports-legal-barriers[ja]

Nevertheless, the reality is that eSports players are still not earning as much as players in other popular sports. Only a handful of eSports players can win large prizes, and many players are juggling their eSports activities with their main jobs.

Therefore, the establishment of an ‘eSports division’ by companies, where employees can receive a salary and engage in eSports activities as part of their job, just like traditional sports, holds significant meaning for the popularization of eSports in Japan.

In overseas cases, there is a significant difference in performance between part-time eSports players and full-time players. However, there is a dilemma that if one commits to eSports as a professional gamer, it becomes difficult to find other work after retiring from eSports.

After Hiring an eSports Player

What kind of work can be expected when a company actually hires an eSports player?

Working Style of Employees Hired Under the eSports Category

The working style of an eSports player hired as an employee under the eSports category largely depends on the content of the employment contract, and there is no set working style. However, the working style of players in corporate sports teams can be a reference for hiring under the eSports category.

In the case of corporate sports team players, their position as employees is essentially the same as other general employees. However, they will carry out their sports practice and participation in tournaments as part of their company duties. Depending on the company, travel and accommodation expenses may be paid by the company as business trips when they go on expeditions to participate in tournaments.

The extent to which employees hired under the sports category perform regular daily duties varies from company to company. There are favorable conditions where they are exempted from the obligation to report to their assigned department and can concentrate on practice without performing any daily duties, and there are also conditions where they engage in daily duties like other employees during certain hours, such as in the morning, and practice during other hours.

From a company’s perspective, if their affiliated players excel in tournaments, it can also serve as publicity for the company. However, it is believed that many companies are hiring under the sports category with the intention of contributing to the development of the sport, beyond their own publicity.

Second Career of eSports Players

Because eSports require instantaneous power, it is said that the period in which one can be active on the front line is short. Therefore, it is not realistic to continue earning a living solely from eSports, and many players face the issue of a second career after retirement.

After a player hired under the eSports category retires, they will basically take on daily duties as an employee of that company. Depending on the content of the work the company expects from the retired player, it may be better to have the player handle some daily duties even while they are active.

Therefore, it is important to consider the working style of eSports players after joining the company (the ratio and content of daily duties and activities as a player) by working backwards from the second career of eSports players.

In the case of real sports, the daily duties after a player’s retirement often involve sales jobs that utilize their physical strength and fame. However, in the case of eSports, because they are familiar with the game itself, if they are involved with a company in the gaming industry, they may also have paths to become planners, public relations, website operators, or developers.

Job Openings in the eSports Sector

When hiring eSports players as employees under the eSports category, the job conditions of existing corporate teams in real sports can serve as a reference.

Contracts with eSports Players are Employment Contracts

When hiring players under the eSports category, regardless of whether they are full-time or contract employees, it is generally assumed that they will be under an employment contract. This is because, ultimately, players in the eSports category are treated the same as other general employees.

Job Details for eSports Players

The job conditions for eSports players differ slightly from those of other general employees. Specifically, you may need to offer different conditions for the following items compared to general employees.

• Attendance, allowances, and handling of participation fees during tournaments and matches
• Regular working hours
• Time that can be allocated for practice
• Special allowances (such as prize money for good performance in competitions)
• Promotional activities (such as displaying the company logo on uniforms)

Especially from the perspective of eSports players, they would be concerned about how freely they can practice daily and participate in tournaments. Working conditions are closely related to the aforementioned working style and second career, so it is necessary to align them early on.

In addition, if you expect promotional effects from hiring eSports players, you will need to include conditions such as displaying the company name or logo on the uniforms worn by the players.

Furthermore, while it is often thought that salaries, such as expected annual income, are determined according to the same salary table as other general employees, it is also a good idea to decide how to reward good performance in tournaments and the like.

While some may consider reflecting it in regular bonuses, it is also possible to consider providing special allowances or prize money each time a performance is achieved.

Also, the affiliation of players hired under the eSports category varies by company. If the main activity is as a player, it seems common to assign them to departments such as the Human Resources Department.

Points to Consider When Hiring eSports Players

When hiring players in the eSports category, it’s important to gain understanding from other employees.

This is the same as hiring in real sports categories such as corporate teams, but there is a possibility that other general employees may resent the players in the privileged environment of the eSports category, who are allowed to only practice without handling daily operations.

Therefore, fostering a momentum to boost the players in the eSports category as a whole company can also be said to be the key to successful recruitment activities in the eSports category. Specifically, it requires concrete efforts such as planning events to support eSports, publishing interviews with eSports players in the company’s PR magazine, and quickly disseminating achievements within the company.

Summary

There are not yet many companies hiring in the eSports field. However, eSports is already a popular market overseas and is expected to rapidly gain popularity in Japan as well.

Therefore, particularly for IT companies with deep ties to the gaming industry, it would be strategically meaningful to start hiring in the eSports field ahead of other companies at this stage.

However, as there are not yet many examples of hiring in eSports, there is a possibility of unexpected issues arising after hiring. Therefore, it is advisable for companies considering hiring eSports players to thoroughly consider the terms of employment and treatment after hiring in advance.

Given that eSports is still a new genre, we recommend consulting with a lawyer who is knowledgeable in the IT field and eSports when considering these issues.