employment contracts

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.

In order to ensure predictability in the management of their business and staff, many employers will draft employment contracts that specify that employees must give notice before quitting their job.  Typically the required notice will be several weeks to several months.  However, even if an employee fails to give notice, employers cannot force pre-determined penalties on employees who suddenly quit.

Employment contracts in Japan generally define the relationship between the employee, the job and the company.  In Japan, an employment contract must clearly state the period of the labor contract, the workplace, job duties, the existence of overtime, the start and end time as well as days off, the wage and rules regarding dismissal.  It is the duty of the employee to check the contract before signing to ensure that he or she agrees with all the terms.  Therefore, it is important to have the contract translated if it is in a language that the employee cannot read.

The Partial Amendment of the Employment Contract Act of Japan took effect on April 1st, 2013 and is designed to help employees who are on fixed term contracts that continuously get renewed.  The rule states that any fixed-term contract employee who has had his or her contract renewed 4 times can apply for a change to an employment contract without a fixed term.  This rule greatly benefits contract employees who have been stuck in a cycle of continuous contract renewal with no chance of becoming a permanent employee.