JAPAN Trends and Developments Contributed by: Hiroaki Matsui, Mari Ueki, Yui Omoteyama and Rei Yamaguchi, AI-EI Law Firm
that can be transported per day, and this is referred to as the “2024 Problem”. Furthermore, working hours are defined as the time during which employees are under the employer’s direction and supervision (Supreme Court judgment of 9 March 2000, Employee v Mitsubishi Heavy Indus - tries Nagasaki Shipyard , Minshū, Vol 54, No 3, p 801), and employers are responsible for managing employ - ees’ working hours. If it is difficult to calculate working hours when employees work outside the workplace, the employer may deem that the employees work for the prescribed working hours (Article 38-2, paragraph 1 of the LSA). Recently, the Supreme Court issued a judgment relating to this provision. In the above-mentioned case, the Tokyo High Court ruled that because the employee working outside the workplace created daily work reports, it was not dif - ficult to calculate working hours (ie, working hours could potentially be calculated and were not “difficult to calculate”, so Article 38-2, paragraph 1 of the LSA shall not apply). However, the Supreme Court found that the nature, content and manner of the work, as well as the method and content of instructions and reports, made it difficult to determine the specific working conditions outside the workplace. With - out thoroughly examining the accuracy of the daily reports, the High Court’s judgment that it was not “dif - ficult to calculate working hours” was deemed erro - neous, and the case was remanded for further review (Supreme Court judgment of 16 April 2024, Employee v CO-OP Globe , Saibansho Jihō, No 1837, p 3). The introduction of remote work has progressed dur - ing and after the COVID-19 pandemic. As work styles diversify, including remote work and telecommuting, discussions have arisen on how to calculate working hours. Therefore, this Supreme Court judgment and subsequent lower court judgments will likely serve as future references. Equal Pay for Equal Work Article 9 of the Act on Improvement of Personnel Management and Conversion of Employment Sta - tus for Part-Time Workers and Fixed-Term Workers (Act No 76 of 1993) (the “Part-Time and Fixed-Term Employment Act”) prohibits discriminatory treatment
concerning basic wages, bonuses and other benefits for being a part-time or fixed-term worker. Essentially, this provision is considered to establish the Japanese equivalent of the principle of “equal pay for equal work”. Moreover, the amendment of the Part-Time and Fixed-Term Employment Act was implemented for all companies in April 2021. In addition, the MHLW has created Guidelines for Equal Pay for Equal Work as a document that outlines a general approach and specific examples. Please note that the guidelines are currently being reviewed by the MHLW five years after their implementation, and their content may be revised in the future. However, it is important to note that the Part-Time and Fixed-Term Employment Act primarily governs the relationship between regular employees and part-time or fixed-term workers, and does not address wage disparities among regular employees. Therefore, it seems that the Part-Time and Fixed-Term Employ - ment Act’s regulation mainly governs the gap between employment conditions in different groups, and the Japanese version of the “equal pay for equal work” is not synonymous with the equal pay for equal work regulation in other countries. Furthermore, Article 9 establishes that discrimination is prohibited for cases where, “considering the prac - tices and other circumstances in the relevant work - place, it is foreseeable that the content and arrange - ment of duties will be changed within the same scope as the changes made to regular employees’ duties until termination of the employment relationship”. This means that justified differences in compensation may still exist based on the nature of duties, their complex - ity, or the possibility of job rotation. Moreover, the regulation of age-based employment discrimination (which is often debated abroad) is not as stringent in Japan. However, the Act on Stabili - sation of Employment of Elderly Persons (Act No 68 of 1971) obliges companies to provide continued employment until the age of 65 to those who desire it. As a result, most Japanese companies typically set the retirement age at either 60 or 65 in employment contracts; moreover, if the companies set the retire - ment age at 60, many opt to offer part-time or fixed- term contracts to employees aged 60 to 65 for a few
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