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In general, an employee in Japan may not be fired if the dismissal lacks objectively reasonable grounds.  Dismissals are also invalid if they occur within 30 days of an employee missing work for medical treatment, or for a woman employee leading up to or following childbirth.  These rules prevent companies from arbitrarily firing employees or punishing them for taking necessary medical leave.

However, it should be noted that this rule does not apply if the employer pays compensation for the dismissal or continuing work has become impossible due to unavoidable events.  In many situations, the employee and employer will agree to a severance package that provides extra compensation for the employee in exchange for the employee leaving the company.

If you have any questions about hiring or firing employees for your business in Japan, please contact our office for a legal consultation.