Employment & labour law in Japan
Is a distinction drawn between local and foreign workers?
My comments in red
Foreign workers must satisfy immigration requirements in order to work in Japan. Visa requirements do not apply to nationals of countries with which Japan has reciprocal exemption arrangements. Foreign nationals who wish to work in Japan must select their residence status based on their circumstances and qualifications. A foreign worker’s residence status is the basis on which he or she can stay in Japan and carry out the activities listed in the Immigration Control and Refugee Recognition Act (eg, perform duties as an investor, manager, accountant, engineer, humanities or international services specialist or skilled labour). The employer must inform Hello Work (a government-run agency with offices throughout Japan) if it hires a foreign employee. So depending on the work classification, you can be eligible for unemployment benefits which are managed by Hello Work. Your company will give you any paperwork required. Typically it is funded by a monthly amount deducted from your salary when you work.
Japan has entered into social security agreements with a number of countries, including Germany, the United Kingdom, the United States, Belgium, France, Canada, Australia, South Korea, Brazil, India and the Netherlands. Individuals who are insured under pension and social security schemes from one of these countries may be exempt from enrolling in Japan’s pension scheme and paying social security insurance premiums depending on the scope of the bilateral agreement. If you are having pension payments deducted, there are provisions where you can get money back if you leave Japan. It is up to 2-3 years of contributions I believe.
Foreign nationals working in Japan are subject to Japanese employment laws, even if the laws of another jurisdiction govern their contract. It is not uncommon for small foreign companies to use contracts drawn up in their home countries for employees in Japan, if they have no local company set up in Japan. This limits the ability of employees to use Japanese labor law in cases of disputes.
Labor Consultation Service for Foreign Workers
The Tokyo Metropolitan Government offers labor consultation staffed with English and Chinese interpreters at the following Labor Consultation Centers. Most foreign companies do not want either the Japanese national labor authorities or the Tokyo metropolitan government to engage them in discussions about specific cases or disputes as it takes time, resources and funds to do that. However, it is important to know your rights under Japanese laws in order to make the best possible negotiations with your company if there is ever a dispute so you can make informed decisions.
Labour related laws you need to be aware of
- Advance notice of dismissal.
In the case of dismissing a worker, the employer is required, in principle, to give the worker an advance notice of least 30 days before dismissal. In case an advance notice is not given at 30 days before dismissal, the employer must pay him/ her the amount of average wages for the number of days falling short of the 30 days dismissal notice allowance required by law. This shall not apply, however, in the case where the employer becomes unable to continue his/her business owing to uncontrollable circumstances such as national calamities, etc.,or where the employer dismisses the worker for reasons in which the worker is responsible for being dismissed. (Article 20 and 21 of the Labour Standards Law) It is good to know the provisions of your contract, and how it fits with Japanese labor law, just in case there is a dispute with your company. Most companies won't knowingly risk breaking the law but some might count on employees not knowing their rights under regulations and the law. This can apply to foreign employees as they might not know Japanese law as well as a company HR employee.
- Annual leave with pay
Annual leave with pay is to be given to workers who have been employed continuously for 6 months, and have worked for 80% or more of the whole working days. (Article 39 of the labour Standard Law). I believe it is up to 2 weeks annual leave for employees but you should check the relevant laws and your contract to confirm.
JETRO - (Reference 3) Coverage of temporary workers by labor law
The term "Temporary worker" refers to a worker that enters into an employment contract with a temporary staffing agency (the company that temporarily places the worker), and who, under the orders of the agency, reports for work at a client company of that agency (i.e., a company that enters into a temporary worker placement contract with the agency, and then accepts temporary placement of the worker), and who performs duties under the orders of the client company.
Labor laws such as the Labor Standards Act, the Industrial Safety and Health Act, and the Equal Employment Opportunity Act apply to temporary workers. Companies that accept placement of temporary workers bear the responsibility of complying with the provisions of the Labor Standards Act pertaining to working hours, breaks and days off; those companies may have temporary workers work overtime within the scope allowed by the Labor Standards Act provided they enter into a labor agreement regarding workers' overtime with the agency that places the temporary worker. In this case, the temporary staffing agency bears the responsibility to pay increased rate of wages. Just a comment, it is important to confirm how overtime is handled by your agency, as it is sometimes capped in your employment contract. Some contracts in IT outsourcing companies will include provisions of up to 20 hours overtime monthly into their offers of base salary. Likewise, time sheets that are filled out should reflect actual hours worked and any overtime worked.
It is the temporary staffing agency's responsibility to ensure temporary workers' annual paid leave, and to supply the client company with a replacement worker if necessary while the original temporary worker is on annual paid leave. Furthermore, it is the temporary staffing agency rather than the client company that must take out labor insurance (Workers' Accident Compensation Insurance and Employment Insurance) and social insurance (Employees' Pension Insurance and Health Insurance) for the temporary worker and pay the appropriate premiums. Any deductions are noted on the pay slips and you should ask what they are, and what they entitle you to. If health insurance is deducted, then you get a health insurance card. Likewise if there are fewer deductions, then you should check what isn't being paid and why. It is better to know and understand the reasons just to confirm that you have no liability later on.
If a client company accepts illegal supply of temporary workers (exceeding period limitations, disguised contract, unauthorized supply service, etc.), a direct employment relationship is deemed to have been established between the client company and the temporary workers at the time of accepting such supply of temporary workers. Companies will be very sensitive to any liability for temporary workers and will not want to risk any problems with individuals so they are not often willing to help in any disputes with the temporary agency.