Labor Law in Japan

Recording of Worker’s Time of Coming to and Leaving from Work

1. The employer is required to enter in the payroll book the number of working days, the number of working hours, the number of overtime working hours, the number of holiday working hours and the number of midnight working hours for each of workers pursuant to Section 54 of the Enforcement Regulations of the Labor Standards Law under Section 108 of the Labor Standards Law.

Even for those in the post of administration or supervision who are excluded from this requirement, the employer is also obligated to make proper control of their working hours in view of the need for midnight working payments and annual paid leaves to them.

2. However, problems are apt to occur for workers such as non-payment of extra wage or excessively long work due to the employer’s failure to make proper control of their working hours. Therefore, the Ministry of Health, Labor and Welfare laid down “Standards for Measures Taken by Employers” under the Circular Notice No. Kihatsu 339 dated April 6, 2001, excerpts from which are as follows:

(1) Confirmation and recording of starting time and closing time of work

The employer is to confirm and record the starting time and closing time of work for each of working days of workers in order to make proper control of their working hours.

(2) Method in principle of confirmation and recording of starting time and closing time of work

In principle, any of the following methods is to used by the employer for confirmation and recording of the worker’s starting time and closing time of work.

(a) The employer is to confirm and record the worker’s working hours in person.

(b) The employer is to confirm and record the worker’s starting time and closing time of work on the basis of any objective recorded data by means of the time card, IC card, ID card or personal computer.

(c) When the worker’s self-declaration system of working hours is adopted, the employer is to investigate whether the declared working hours are conformed to the actual working hours.

(d) The employer should not take the step to set the upper limit of the overtime working hours.

3. For the workers engaged in their discretionary work of professional service, the employer is required to use the following method as “Measures to Secure Health and Welfare of Workers” under the Labor Standards Law as amended on January 1, 2004.

(1) The method to determine working conditions of workers is to be based on the record of their time of coming to and leaving from the work or the record of their time of coming in and leaving from the office which may clearly indicate how many hours in any time zone they are staying in the company so that they are able to offer their professional service.

The Ministry of Health, Labor and Welfare is taking “Perfect Execution of Proper Control of Working Hours” as its priority policy again in fiscal 2004. This policy is taken because of the dispute arising as a social problem whether the worker’s death caused by strain due to excessive overwork is covered by the workmen’s compensation insurance as an on-the-job accident or not as an accident while off duty. Recently this problem is stirring up a big social attention not only as a matter of eligibility for the workmen’s compensation insurance, because there was a case where the family of a worker so died brought an action against the employer for damages by reason of the employer’s violation of obligation to secure the worker’s safety or the employer’s liability for tort committed to the worker and the employer was ordered by the court to pay damages in a huge amount exceeding \100 million. There was also a case where the employer’s responsible person was arrested on a charge of violation of the Labor Standards Law in connection with the case of the so-called service overtime work (overtime work without compensation). In order to avoid such risks and also as the first step to enhance the corporate compliance, the company must endeavor to determine working hours of workers correctly.

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