Labor Policy Keiichiro HAMAGUCHI

Chapter 2 Working Conditions Policy

Section 4 Employment Contract Policy

(1) Civil Code 1896 Civil Code defined employment contract as exchange of service and remuneration. CC set 5 years limit on the length of contract (Art.626). CC declared “employment at will” principle with just 2 weeks notice period (Art. 627).

(2) Labor Standards Law and its revision 1947 Labor Standards Law set 1 year limit on the length of contract and 30 days notice period. Study Group on Labor Standards Law Report advocated extension to 5 years revised LSL set exceptional 3 years limit for professionals revised LSL set normal 3 years limit and exceptional 5 years limit for professionals.

(3) Fixed-term labor contract issues Employment protection of open-ended contract made fixed-term contract precarious Supreme Court Judgment protected some repeatedly renewed contract Guidelines on Renewal of Fixed-term Contract had no binging effect revised LSL and its Guidelines required employers clarification on renewal and 30 days notice period Labor Contract Law obliged employers to consider on renewal of fixed-term contract.

(4) Dismissals CC declared “employment at will” principle with just 2 weeks notice period (Art. 627). Case law established doctrine of abusive dismissal and 4 requirements on redundancy ILO Convention No.158 on Termination required valid reason revised LSL legislated the doctrine of abusive dismissal. The provision was transferred to 2007 Labor Contract Law.