The Japanese Constitution protects the freedom of choice of employment. Therefore, within limits, people should be able to work for whatever company they want. However, Non-compete clauses in Japan are very common in contracts.
Japanese law does recognize the validity of non-compete clauses to certain extent. If the non-compete clause is reasonable in the length of time, the geographical area and the specific industry, then a court might uphold the non-compete clause as valid. In some situations, sufficient compensation must also be provided.
Some contracts include non-compete clauses which are overly broad, which may not be enforceable under Japanese law, so it is important to know the limitations on the enforceability of such clauses.
If you have any questions about hiring or firing employees or about non-compete clauses in Japan, please contact our office for a legal consultation with one of our lawyers.