1.6 To what extent are the terms of employment agreed in collective bargaining? Do negotiations usually take place at the company or sector level? In general, contracts can contain almost everything in Japan, with the exception of points/clauses contrary to public policy. Suppose you have a foreign company and you want to establish an employment contract in Japan according to the laws of your own country. It is quite possible in Japan; Japan`s occupational health and safety laws (i.e. the Labour Standards Act) continue to apply to workers in Japan. As a result, Japanese labour laws generally prevail over all applicable laws under a foreign employment contract in Japan. The aim is to prevent employers from creating unfair employment contracts for workers. In addition, Article 15 of the Japanese Labour Standards Act provides that the worker has the right to terminate his employment contract immediately if the working conditions indicated in the employment contract differ from the actual responsibilities. In June 2018, the Japanese parliament passed laws to amend employment legislation (including the LSA and LCL) and improve the working environment, focusing on issues related to long working hours and pay gaps between regular and non-regular workers (the so-called “Work-Style Reform Laws”). The main elements of these new laws came into force on April 1, 2019.
Contracts and agreements are the essence of any business, and understanding how they work in Japan is essential for you and for any company your company will work with in Japan. As in many countries around the world, employment contracts are entered into in accordance with Japanese law when there is an offer and acceptance. However, the validity of employment contracts can be confusing, especially in cases where business and financial risks are at stake. This article discusses the fundamental principles of contracts and employment agreements in Japanese companies. If a collective agreement requires an employer to seek the agreement of a union to dismiss workers, dismissal without that consent is considered null and fore. As long as the employer and the union (the social partners) are empowered to agree on conditions that should not be less favourable to workers than the minimum standards set by the ASA, they will be able to agree on all conditions during collective bargaining. In practice, collective agreements generally include important terms of employment such as wages and other benefits, days off, paid leave, notice, promotions, transfers and disciplinary procedures. The employer is not required to discuss or agree on issues relating to the organization of the company and high-level management that are not directly related to the terms of employment.