JAPAN Law and Practice Contributed by: Junichi Ueda, Etsuko Hara, Nobuto Shirane, Takahiro Hayase, Yutaka Shimoo and Miki Goto, Anderson Mori & Tomotsune
vide for the basic rules and are therefore abstract in nature. 4.2 Characteristics of Employment Contracts Form of Employment Contract An employment contract may be executed ver - bally. However, to avoid any misunderstandings regarding major working conditions, the LSA and other applicable laws and regulations require an employer to prepare a document clearly describing those major working conditions and to deliver it to a new employee upon entering an employment contract (eg, Article 15 of the LSA). Examples of major working conditions include: • the term of employment; • the location of the workplace (including whether and to what extent the location of the workplace may be subsequently changed); • the job description (including whether and to what extent the job description may be sub - sequently changed); • the working hours; • whether overtime work or work on holidays will be necessary; • a description of holidays; • the leave policy; • the wages to be paid; and • the grounds and procedures for termination of employment. In addition, if an employer usually employs ten or more employees, the employer must estab - lish the rules of employment, which consist of a set of documents stipulating the specific details of the working conditions. A copy of the rules of employment must also be submitted to the Labour Standards Inspection Office together with a written opinion regarding the rules of employment from either:
• a trade union to which a majority of the employees of the workplace concerned belong (majority trade union); or • if such a union does not exist, an employee representing a majority of the employees at the workplace concerned (employee repre - sentative) (Articles 89 and 90 of the LSA). The contents of the rules of employment must be made available to the employees at all times for inspection (Article 106 of the LSA). Duration of Employment Contract The two main types of employment contract that exist in Japan are: • those with a fixed term; and • those with an indefinite term. In practice, regular employees are usually hired for an indefinite term. Under the LSA, the maximum duration of each fixed-term employment contract is three years. However, the maximum duration of each fixed- term employment contract is five years for: • certain specialists; and • employees who are 60 years of age or older (Article 14 of the LSA). Although the maximum duration of each fixed- term employment contract may not exceed three years (or five years in the case of employees who are 60 years of age or older and certain specialists), the employer may renew the fixed- term employment for more than the maximum duration. There is no explicit minimum duration for a fixed- term employment contract. However, the LCA provides that an employer must not set a shorter
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