In general, Japanese employers are held liable for damage caused by the negligence of their employees during work. This same liability extends to people who supervise a business on behalf of an employer. However, this strict standard does not apply when the owner has exercised reasonable care in appointing or supervising the employee, or in circumstances where the damage could not have been avoided even if the employer had exercised reasonable care. Furthermore, the employer is free to seek reimbursement from the negligent employee where appropriate.
A pizza delivery business can provide an example of how this liability works in practice. A pizza store owner has his employees deliver pizza by motorcycle. However, he hires an employee that has a long record of motorcycle accidents. Naturally, this employee again causes a motorcycle accident, this time while delivering pizzas for the company. His employer, who did not exercise reasonable care in hiring or training his employee, would be liable for the damaged caused by the crash.
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