Labor and Employment

All companies are subject to the employment law when they hire employees for business operation. There are extensive regulations of the employment law against every single situation ranging from recruitment to retirement of employees, and the contents of the law are becoming more and more complex.
On the other hand, the importance of complying with the employment law has been dramatically increasing because of the tightening of regulations on, and the growing interests in, labor issues. If companies fail to comply with the employment law properly, they could be subject to strict administrative guidance or supervision by the Labor Standards Inspection Office etc., or face legal proceedings commenced by employees. Non-compliance with the employment law could be known immediately and widely through SNS, and this may cause damage to the social reputation of companies.
In order to provide high quality legal advice to our clients, we are always making efforts to keep up with the latest laws and judicial precedents in the employment law field. Based on such latest knowledge and know-how, we are providing legal advice to our clients according to their individual situations.
We also have extensive experience in the dispute resolution of labor issues including litigation and labor tribunal, and make fullest efforts to reach satisfactory results for our clients.

Practice Areas

• Work rules, employment contracts, labor-management agreement and other employment-related documents
  　Our firm assist with the creation and revision of work rules and their subordinate rules (such as wage rules and retirement allowance regulations), employment contracts, employment condition notices, labor-management agreements, and other HR-related documents. In addition we provides advice on the construction and revision of underlying human resources and wage systems, as outlined below.
  

• Construction and revision of human resources systems and wage systems
  　Our firm supports the construction and revision of a company’s human resources systems and wage systems. During system revision, we comprehensively assist in identifying issues with the existing system, considering revision policies, proposing concrete revision plans, and preparing necessary documents and procedures. For example, we support the transition from seniority-based wage systems to performance-based rewards or the introduction of so-called “job-based” systems. Depending on the system, it may be possible to reduce wages of employees without obtaining individual consent from the employees.
  　When constructing or revising HR and wage systems, it is crucial to handle the process carefully to avoid any deficiencies that could invalidate the system later. Recently, there has been an increase in cases where the validity of fixed overtime pay systems has been denied due to procedural flaws or deficiencies in the system itself. Therefore, it is important to proceed cautiously to prevent such situations.
  

• Review of company’s internal employment system in accordance with the amended laws and regulations
  　In recent years, labor laws have been amended almost annually, necessitating the revision of human resource systems or the updating of work rules and/or templates for employment contract. Our firm broadly supports these tasks associated with such legal revisions.
  

• Changing of working conditions
  　When changing working conditions, it may be necessary to obtain individual consent from employees, not just amend the work rules. If sufficient explanation about the changes and the extent of any disadvantages is not provided, the validity of the consent may be denied later.
  Our firm advises on what changes should be made to the working conditions in individual cases and proposes methods and procedures for implementing these changes.
  

• Dealing with Problematic Employees
  　 There are various ways to deal with employees who cause problems within the company. The appropriate solution depends on the nature and cause of the issue. Our firm proposes suitable solutions based on laws, court precedents, and our extensive experience and practical know-how.
  

• Harassment
  　Recently, there has been a significant increase in harassment complaints from employees. When a complaint is filed, the company must conduct a proper investigation, derive the results, and take appropriate actions.
  　Regarding how to conduct an internal investigation, our firm can either provide advice on the investigation process and key points while the company conducts the investigation, or we can have attorneys conduct interviews and other tasks on behalf of the company.
  　Our firm supports not only the internal investigation but also various responses based on the results and handles cases if the harassment issue escalates into disputes or lawsuits.
  

• Dismissal, non-renewal of contract, encouragement to resignation
  　Under Japanese labor law, there are certain regulations on dismissal and non-renewal of contracts. If the validity of a dismissal or non-renewal is denied in a lawsuit, the company may face substantial damage, including reinstating the employee and paying significant back pay. Our firm provides advice from the stages of warning, guidance, PIP and retirement encouragement to reduce the risk of such issues.
  　In some cases, dismissal or non-renewal of contract may not be the appropriate solution for the problems the company faces. In such situations, we propose alternative solutions.
  

• Disciplinary action
  　When employees commit misconduct, the company considers disciplinary actions. Under Japanese labor law, there are certain regulations on disciplinary actions. Our firm provides advice on whether disciplinary is nessesary and what type of action to be taken based on the case. Additionally, we support the investigation of the facts surrounding the misconduct and offer advice on the procedures required to implement disciplinary actions.
  

• Workforce reduction due to closing or downsizing business
  　When conducting a workforce reduction, it is crucial to develop a meticulous plan. Our firm supports your company from the planning stage through the entire process, including communication with employee, encouraging voluntary resignations, negotiating retirement packages, drafting retirement agreements and implementing dismissals.
  

• Transfer, demotion, secondment
  　When implementing transfers, demotions, secondments, it is necessary to confirm whether these actions can be carried out without obtaining individual consent from employees and whether there is any risk of them being deemed invalid later. Our firm provides advice on the methods and procedures for carrying out these actions based on individual cases. Additionally, we may propose these actions as a way to address problematic employees.
  

• Mental health issues
  　Recently, issues related to employee mental health have been increasing. In some cases, employees develop mental disorders leading to suicide. If mental health problems arise due to work-related issues, the company could be liable for substantial damages. Even if the mental health issues are not work-related, companies often face challenges on how to address these issues, whether to allow a return to work after leave. Our firm provides comprehensive support in resolving these mental health-related issues.
  

• Industrial accident
  　In addition to the aforementioned mental health issues, whether death from overwork or injuries qualify as work-related accidents often becomes an issue. Other cases have involved disputes over whether conditions like back pain, chemical sensitivity, diabetes, asthma, gastritis, pneumonia, COVID-19, and hearing loss are considered work-related accidents. Our firm provides various advice and support on these issues, including responding to Labor Standards Office investigations, preparing opinion letters for submission to the Labor Standards Office, and supporting negotiations with employees.
  

• Transfer of Employees and unification of systems associated with M&As
  　When conducting employee transfers and succession between multiple corporations during an M&A, it may be necessary to obtain the employees’ consent or follow certain procedures. Additionally, if unifying HR systems across multiple corporations due to an M&A, changes to work rules and individual consent from employees may be required.
  　Our firm supports not only the entire M&A process but also provides advice specifically focused on HR and labor issues related to M&A.
  

• Claims for Unpaid Overtime and Unpaid Wages by Employees
  　Recently, disputes over unpaid overtime have been increasing. Additionally, there are cases where employees claim that wage reductions are invalid and seek unpaid wages. Since April 2020, the statute of limitations for wage claims has been extended to three years, with a possibility of further extension to five years, making the impact of unpaid wage and overtime issues on companies significant.
  Recently, cases have increased where the validity of fixed overtime systems and irregular working hours systems have been denied, resulting in claims for unpaid overtime being upheld. In such cases, not only the employee who filed the lawsuit but other employees may also have similar unpaid overtime.
  Our firm not only responds to claims for unpaid overtime and wages but also provides advice on system revisions and improvements as necessary.
  

• Labor tribunal, litigation, mediation or other dispute resolution procedures
  　Our firm focuses on preventing labor-management disputes before they arise. Even when disputes do occur, we resolve many at the negotiation stage before they escalate to labor tribunals or lawsuits. However, some disputes inevitably proceed to labor tribunals, litigation, arbitration, or other procedures. In such cases, our firm will handle these processes to secure the most favorable outcomes possible.
  

• Support for appeals in lawsuits filed by employees
  　When a lawsuit is filed by an employee and an unfavorable judgment is rendered in the first instance, the company needs to appeal and attempt to reverse the decision in the appellate court. For example, in a lawsuit challenging the validity of a dismissal, if the reasons for dismissal were adequately asserted but the evidence was insufficient, it is necessary to supplement the proof. In cases involving complex legal issues, it may be necessary to supplement the legal arguments.
  　Even if a complete reversal is difficult, it is often possible to achieve partial relief. For example, if an employee challenges the validity of a dismissal and the first instance court finds the dismissal invalid, it may be possible to reduce the amount of back pay owed to the employee by proving that the employee has since found employment elsewhere. In some cases, the approach of withdrawing the dismissal itself may be considered from a strategic perspective. Additionally, in lawsuits demanding unpaid overtime, if the first instance court orders the payment of both overtime and additional allowances (Fuka-kin), appealing and simultaneously repaying the overtime can exempt the company from paying the additional allowances.
  　We can represent companies in appellate courts and also provide second opinions as necessary.
  

• Support for post-litigation processes
  　When a lawsuit challenging the validity of a dismissal is filed by a dismissed employee and the company loses the case, the company needs to address and consider (i) reinstatement of the employee, (ii) payment of wages after the dismissal date and (iii) procedures of social insurance and taxes. Regarding (i), it often becomes an issue whether to reinstate the employee, and if so, when, in what position, and with what duties.  The working conditions after reinstatement is also should be considered. Additionally, if the worker refuses to return, the company might have to consider dismissal again for that reason.
  　When a company is ordered to pay unpaid overtime in a lawsuit, it needs to review its wage system and/or methods of managing working hours to prevent the recurrence of similar issues.
  　We provide support for such post-dismissal processes and proposes various measures to prevent similar issues in the future.
  

• Dealing with competition by employees or headhunting of employees
  　Our firm handles consultations regarding violations of non-compete and confidentiality obligations by employees, as well as employee poaching by competitors. As employees have the freedom to choose their occupation, agreements related to non-compete and confidentiality may be deemed invalid in some cases. However, depending on the agreement’s content and the severity of the employee’s actions, it may be possible to claim damages based on breach of agreement, tort, or violations of the Unfair Competition Prevention Act.
  　Additionally, our firm offers measures to prevent similar issues. For instance, reviewing the content of commitment letters and revising internal information management practices can help reduce the risk of such disputes.
  

• Support for Employment Agencies
  　Our firm accepts various requests from employment agencies, such as support in structuring referral fee schemes and drafting contract templates. In transactions involving employment referrals, issues often arise concerning the conditions for referral fees, refund terms, and ownership clauses. Therefore, it is crucial to consider these factors when creating contract templates.
  

• Handling various disputes related to employment placement
  　Our firm provides services to address various disputes related to employment agencies. In addition to supporting dispute resolution, we also propose various measures (such as contract review, revision of contract templates, and fee scheme modifications) to prevent future disputes.
  　Typical dispute cases include the followings:
  ・Employers refusing to pay referral fees.
  ・Disagreements over the calculation method of referral fees.
  ・Disputes between employment agency and platformer regarding the fee calculation for scouted candidates to be paid to the platformer.
  ・It turned out that hired candidates have not met job requirements after joining the company.
  ・Candidates resigning shortly after joining company, leading to refund requests.
  ・Employers hiring candidates through other routes after initially rejecting them, resulting in penalty claims from employment agencies.
  

• Worker Dispatching
  　Our firm provides various advice on dispatching employees to both dispatching companies (dispatching agencies) and client companies. Additionally, we offer advice to companies engaging in subcontracting transactions to avoid falling into disguised subcontracting. Recently, there have been cases where workers of a subcontracting company have directly sought employment from the client company due to disguised subcontracting.
  

• Dealing with whistleblowing and investigation
  Recently, there has been an increase in cases where employees report labor issues, particularly harassment, to the company. When such reports are made, the company must respond appropriately according to various laws and guidelines. Depending on the case, consideration must also be given to information management and the composition of the investigation team. Our firm supports responses to such reports and conducts internal investigations as neutral attorneys.
  

• Employment of foreigners
  　When employing foreign nationals, special considerations different from those for Japanese employees may be required. For instance, it might be necessary to prepare employment contracts and work regulations in English. Our firm not only creates various documents in English but also collaborates with administrative scriveners to support immigration and residency procedures.
  

• Employment of persons with disabilities
  　The Act on Employment Promotion of Persons with Disabilities obliges private companies to employ disabled persons according to the size of the company. Recently, there has been discussion on utilizing “disability employment business” service providers and the scheme used by private companies, not engaging in agricultural business, of assigning disabled persons agricultural tasks at a farm located separately from their main office.
  　Additionally, the Act prohibits discrimination against disabled persons and requires the provision of reasonable accommodation for them.
  　Our firm provides various advice related to the employment of disabled persons.
  

• Dealing with regulators
  

• Dealing with criminal investigation and prosecution related to Labor Standards Act or Industrial Safety and Health Act
  

• Other issues in connection with the employment law
  

• Services for labor and social security attorneys
  In addition to requests from companies, we also accept various requests and consultations related to labor law from labor and social security attorneys. We can handle the following types of requests and consultations:
  ・General consultations on the interpretation and practical application of labor law.
  ・Consultations and second opinions on specific labor issues, lawsuits, and labor tribunals for the attorney’s client companies.
  ・Review of various documents (such as work regulations and employment agreements) used by the attorney.
  ・Seminars for the attorney’s office staff or client companies.