I. Shortened Working Hours for Caregivers — Compliance in Japan

1. Meaning and legal framework

Japan's Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfare of Workers Caring for Children or Other Family Members (育児・介護休業法) requires employers to provide measures enabling employees to continue working while caring for a family member who requires care.

For employees providing family care, the employer must establish at least one qualifying system for reducing or otherwise adjusting working time. The available measures include:

1. Shortening daily prescribed working hours;
2. Shortening weekly or monthly prescribed working hours/days;
3. A system allowing specified non-working days or hours;
4. A flextime system;
5. Moving the start or finish time earlier/later;
6. Subsidising care-service costs; or
7. Other equivalent measures.

The current MHLW guidance states that these measures must generally be available for at least three years from the commencement of use and on at least two occasions for each eligible family member.

The statutory provision in Article 23 specifically requires an employer to take measures that make it easier for an employee to provide care while continuing employment.

2. Who qualifies?

The system applies to an employee caring for a family member in a condition requiring care.

The statutory family members include:

• spouse;
• parents;
• children;
• grandparents;
• siblings;
• grandchildren; and
• parents of the spouse.

The MHLW describes the relevant care condition as a condition resulting from injury, disease, physical disability or mental disability requiring continuous care for two weeks or more.

The protection is not limited to women. Male and female employees are equally covered.

3. Employer's compliance obligation

An employer should not treat caregiver short-time work merely as an informal HR benefit.

The employer should have:

• a written caregiving/short-hours policy;
• eligibility criteria;
• an application procedure;
• a prescribed notice period;
• a method for calculating reduced working time;
• payroll rules for reduced hours;
• rules concerning overtime;
• procedures for returning to normal hours;
• a system for documenting applications and decisions;
• confidentiality protections for family/medical information; and
• a mechanism for dealing with disputes.

The employer must also avoid retaliatory treatment.

The Act expressly prohibits adverse treatment because an employee has applied for or taken statutory family-care leave.

The same protective principle is important when an employee exercises statutory caregiver-related rights.

4. Can an employer simply reject the requested schedule?

Generally, not merely because it is inconvenient for management.

The legislation requires the employer to establish an appropriate system. Where the employee satisfies the statutory requirements and the requested measure falls within the employer's established system, HR should not simply refuse the request because:

• the employee is needed in the department;
• replacement staffing is inconvenient;
• the employee is a manager;
• the employee's performance is important;
• the team dislikes the arrangement; or
• the employee's absence creates scheduling difficulties.

There may be statutory exclusions where the employee falls within categories that can lawfully be excluded through a labour-management agreement or the applicable regulations. For example, the MHLW currently identifies certain exclusions including employees employed for less than one year and those working two or fewer scheduled days per week where a qualifying labour-management agreement applies.

The exclusion should therefore be legally established before the employer refuses the request, rather than created retrospectively to justify a refusal.

5. Relationship with overtime

Caregiver accommodation cannot be analysed only through the "shortened hours" provision.

The Act also contains restrictions concerning overtime for employees caring for family members.

Accordingly, an employer should examine separately:

• shortened scheduled hours;
• overtime restrictions;
• holiday work;
• late-night work;
• family-care leave;
• family-care leave periods; and
• flexible scheduling.

A company cannot necessarily defeat the purpose of caregiver protection simply by saying:

"We will reduce your normal hours, but require you to work overtime whenever operationally necessary."

The different statutory protections need to be considered together.

6. Salary consequences

Shortened working hours normally mean that the employee works fewer hours. The employer therefore needs a transparent method of determining:

• basic salary;
• hourly components;
• overtime;
• allowances;
• bonuses;
• attendance-related payments;
• performance assessments;
• promotion eligibility; and
• pension/social-insurance consequences.

However, caregiver status should not become a pretext for discriminatory or punitive treatment.

A particularly problematic arrangement would be:

"You used the statutory caregiver system, therefore we will reduce your grade, promotion prospects or salary."

The employer needs to distinguish between a legitimate consequence of actually working fewer hours and an adverse measure imposed because the employee exercised a statutory right.

7. Six important Japanese cases

Direct reported litigation specifically concerning Article 23 caregiver short-time working arrangements is relatively limited. Consequently, the following cases are important because Japanese courts have developed closely related principles concerning caregiving, transfers, childcare/caregiving statutory rights, and adverse treatment.

Case 1 — Nestlé Japan Case

Nestlé Japan Incident, Osaka High Court, 14 April 2006

The employer ordered employees to transfer from the Himeji plant to the Kasumigaura plant.

The employees had significant family-care circumstances.

The court considered that although an employer may possess considerable authority to transfer employees, the personal burden created by the transfer can become exceptionally serious.

The court concluded that the transfer imposed a disadvantage exceeding what employees could ordinarily be expected to tolerate and therefore constituted an abuse of the employer's transfer authority.

Importance:
Family caregiving circumstances can be legally relevant when determining whether an employer's personnel decision is excessive.

Case 2 — Japan Stainless / Nisshu Konpo Case

Japan Stainless / Nisshu Konpo Case, Niigata District Court Takada Branch, 31 October 1986

The case involved transfers and secondments. One employee had responsibility for caring for parents.

The court considered the employee's caregiving circumstances and held that a transfer involving relocation could become excessively harsh in the circumstances.

Importance:
An employer's general transfer power is not necessarily unlimited where the transfer creates an exceptionally serious family-care burden.

Case 3 — Toa Paint Case

Toa Paint Case, Supreme Court, 14 July 1986

The Supreme Court established the well-known framework for assessing transfer orders.

A transfer may be invalid where, among other things:

• there is no genuine business necessity;
• the transfer is motivated by an improper purpose; or
• the employee suffers an exceptionally serious disadvantage beyond what employees ordinarily have to accept.

The case itself was not a caregiver-short-hours case, but its framework is important where an employer responds to caregiving circumstances through relocation or reassignment.

Importance:
Caregiving does not automatically give an employee a veto over transfers, but the severity of the caregiving burden can be relevant to abuse-of-authority analysis.

Case 4 — Japan Business Lab Case

Japan Business Lab Case, Tokyo District Court, 11 September 2018

This case concerned adverse treatment connected with statutory short-time working under the Child Care and Family Care Leave Act.

The case is particularly relevant because it illustrates the legal problem created when an employer connects a worker's use of statutory reduced-hours arrangements with disadvantageous employment treatment.

The case is discussed specifically as litigation concerning adverse treatment because of statutory short-time working.

Importance:
Short-time working should not become a mechanism for automatically reducing an employee's employment status or career prospects.

Case 5 — Konami Digital Entertainment / K Company Case

Tokyo High Court, 27 December 2011

The employee returned from childcare leave and requested short-time working.

The employer changed her duties to lighter work and reduced her role grade and compensation.

The case is particularly useful for understanding the relationship between:

• short-time working;
• reassignment;
• job grade;
• salary;
• employer discretion; and
• statutory family-work protection.

The reported facts show that the employee's duties, role grade and annual compensation were all affected following her return and short-time-work request.

Importance:
An employer should separately justify a genuine operational reassignment and any accompanying reduction in employment conditions rather than automatically treating short-time work as grounds for downgrading the employee.

Case 6 — Hiroshima Central Health Cooperative Case

Hiroshima Central Health Cooperative (C-Co-op Hospital) Case, Supreme Court, 23 October 2014

Although this case principally concerned pregnancy rather than family caregiving, it is extremely important for the broader principle of statutory work-family protections.

The employee was transferred to lighter work during pregnancy and was removed from her deputy-supervisor position.

The Supreme Court held that demotion connected with the exercise of the statutory right to lighter work is, in principle, prohibited unless special circumstances exist, including circumstances showing genuine voluntary consent or a substantial operational necessity consistent with the protective purpose of the legislation.

Importance:
Employers must distinguish a legitimate operational adjustment from an adverse measure triggered by the employee's exercise of a statutory protective right.

8. Practical compliance checklist

A Japanese employer implementing caregiver shortened-hours arrangements should maintain:

II. Pregnancy-Related Transfer Request Disputes in Japan

1. The fundamental legal distinction

Pregnancy-related transfers need to be divided into two different situations:

A. Transfer requested by the pregnant employee

For example:

"Because of pregnancy, I want to move from the night-shift department to a daytime department."

The employer must examine whether another statutory right applies, including maternity-health-management measures, restrictions on hazardous work, overtime/night work, or the right to transfer to lighter work.

B. Transfer imposed by the employer because the employee is pregnant

For example:

"You are pregnant, so we are moving you to another department."

This raises a much more serious discrimination/adverse-treatment issue.

Article 9(3) of the Equal Employment Opportunity Act prohibits dismissal or other disadvantageous treatment because of pregnancy, childbirth and specified pregnancy/childbirth-related circumstances.

The implementing rules expressly include circumstances such as:

• pregnancy;
• childbirth;
• requesting maternity-health measures;
• requesting transfer to lighter work;
• taking maternity leave;
• restrictions on overtime;
• restrictions on holiday work; and
• restrictions on night work. 

2. Pregnancy does not automatically prohibit every transfer

This is important.

Japanese law does not mean that a pregnant employee can never be transferred.

The legal question is generally whether the transfer is connected to pregnancy or a protected pregnancy-related right and whether it constitutes disadvantageous treatment.

MHLW guidance says that the assessment of a disadvantageous change of assignment should consider matters including:

• necessity of the transfer;
• salary;
• other working conditions;
• commuting circumstances;
• future career consequences; and
• the overall circumstances.

The guidance specifically identifies as problematic a transfer of a pregnant employee that worsens salary, working conditions or commuting circumstances where she is capable of performing her existing work.

3. Timing is important

The timing between pregnancy-related events and adverse treatment can be important evidence.

Current MHLW guidance explains that where disadvantageous treatment occurs within one year after the pregnancy/childbirth-related event, it will generally be regarded as having occurred "in connection with" that event, subject to the circumstances.

Even after one year, regularly scheduled personnel measures such as transfers or performance assessments may still be examined in relation to the first relevant personnel event following the protected period.

Therefore HR should not assume:

"The transfer occurred several months after pregnancy, so it cannot be pregnancy-related."

4. Six important cases

Case 1 — Hiroshima Central Health Cooperative Case

Supreme Court, First Petty Bench, 23 October 2014

This is the leading Japanese Supreme Court authority.

A pregnant physical therapist requested transfer to lighter work under Article 65(3) of the Labour Standards Act.

The employer removed her from her deputy-supervisor position at the time of the transfer.

The Supreme Court rejected the lower court's approach and held that a demotion triggered by the employee's exercise of the pregnancy-related lighter-work right is, as a general rule, prohibited by Article 9(3) of the Equal Employment Opportunity Act.

Two important exceptions were identified:

1. objective circumstances demonstrating genuine voluntary consent to the demotion; or
2. special circumstances showing that avoiding the demotion would cause serious operational/personnel-management difficulties and that the measure does not substantially undermine the protective purpose of the statute.

Practical rule

A company should not say:

"You asked for lighter duties, so you automatically lose your supervisory position."

That approach is legally dangerous.

Case 2 — Hiroshima Central Health Cooperative, Remand Case

Hiroshima High Court, 17 November 2015

After the Supreme Court remanded the case, the High Court reconsidered the circumstances.

The dispute concerned whether the removal from the deputy-supervisor position accompanying the lighter-duty transfer was permissible.

The case illustrates the importance of examining:

• actual consent;
• operational necessity;
• staffing arrangements;
• the nature of the new work;
• the employee's wishes; and
• whether the measure actually undermined the statutory protection.

Practical rule

A company should document why a position change was necessary and what alternatives were considered.

Case 3 — Konami Digital Entertainment / K Company Case

Tokyo High Court, 27 December 2011

The employee returned from maternity/childcare leave and requested short-time work.

The employer changed her work from overseas licensing to domestic licensing, changed her role grade and reduced her compensation.

The dispute therefore involved the relationship between:

• maternity/childcare;
• short-time working;
• reassignment;
• job grade; and
• compensation.

Practical rule

Even if the employer has a contractual transfer power, the employer must be able to explain why the new assignment and accompanying employment consequences were genuinely necessary.

Case 4 — K Company / post-childcare reassignment case

The same line of authority is useful in examining situations where an employer argues:

"The employee's duties had to change because she requested reduced hours."

The court examined the employer's actual operational circumstances rather than treating the request for shorter working time itself as sufficient justification for disadvantageous treatment.

Practical rule

Reduced working hours ≠ automatic loss of grade or status.

The employer should conduct an individual assessment.

Case 5 — Post-maternity/childcare transfer dispute identified by MHLW

MHLW has reported a case in which an employee returned from maternity and childcare leave and was suddenly ordered to transfer to another branch.

The new branch was so far away that, considering childcare arrangements, timely attendance was effectively impossible.

Although the employer argued that the transfer resulted from a vacancy, the labour authority concluded that the circumstances amounted to disadvantageous treatment connected with maternity/childcare leave and advised withdrawal of the transfer.

The employer ultimately withdrew the transfer and allowed the employee to continue at the original workplace.

Practical rule

Commuting consequences matter.

A transfer that technically preserves salary may still create substantial disadvantage because of:

• childcare arrangements;
• commuting distance;
• working hours;
• nursery operating hours; or
• inability to reach the workplace on time.

Case 6 — Hiroshima Central Health Cooperative Supreme Court framework and post-return placement

The Supreme Court case also generated an important supplementary opinion concerning the employee's position after returning from childcare leave.

The opinion emphasised that the employee's post-leave status should not simply be compared with the temporary position occupied during pregnancy-related lighter work. The appropriate reference point may be the employee's position before the temporary pregnancy-related transfer.

MHLW's current guidance similarly stresses that changes in assignment after pregnancy/childbirth or childcare leave must be examined by looking at the economic and professional consequences rather than merely the formal name of the position.

5. When is a pregnancy-related transfer likely to create legal risk?

The following circumstances should receive particularly careful review:

High-risk situations

• Transfer immediately after pregnancy is disclosed;
• transfer to a significantly more distant workplace;
• reduction in salary;
• loss of allowances;
• loss of managerial status;
• loss of career-track position;
• transfer to substantially inferior duties;
• transfer despite the employee being capable of performing the original work;
• transfer following a request for maternity-health measures;
• transfer following a request for lighter duties;
• transfer following an overtime/night-work restriction request;
• transfer that makes childcare arrangements practically impossible;
• statements such as "pregnant employees cannot handle this department"; or
• absence of a documented business reason.

6. What should the employer document?

For a pregnancy-related transfer, HR should create a contemporaneous record of:

1. Business reason for the transfer;
2. Why the employee was selected;
3. Other employees considered;
4. Existing transfer/rotation rules;
5. Employee's pregnancy-related request;
6. Medical or occupational restrictions, where lawfully relevant;
7. Salary before and after transfer;
8. Working hours before and after;
9. Commuting implications;
10. Career implications;
11. Whether alternative assignments were considered;
12. Employee's response;
13. Whether the employee genuinely consented;
14. Whether the transfer was already scheduled independently of pregnancy; and
15. Whether the transfer would have occurred to a comparable non-pregnant employee.

This documentation is particularly important because MHLW guidance treats a transfer occurring in temporal proximity to a protected pregnancy-related event as potentially connected with that event.

7. Pregnancy-related transfer vs. legitimate operational transfer

8. Important distinction: employer-proposed accommodation vs. forced accommodation

Pregnancy protection does not permit an employer to unilaterally assume that a pregnant employee must work less.

MHLW specifically explains that an employer should not force shortened hours or leave merely because the employee is pregnant where there is no relevant medical guidance or employee request. Such forced contractual changes can themselves constitute prohibited disadvantageous treatment.

Therefore:

"Would you like a medically appropriate adjustment?"
can be appropriate.

But:

"You are pregnant, so from tomorrow you will work shorter hours and accept a different job."
can create legal problems.

9. Overall compliance principles

For caregiver shortened working hours

The employer should:

• maintain a statutory compliant system;
• allow eligible employees to use the system;
• provide the legally required duration/opportunities;
• avoid retaliation;
• separately assess overtime restrictions;
• calculate salary transparently;
• protect care-related personal information; and
• consider caregiving circumstances when making major personnel decisions.

For pregnancy-related transfers

The employer should:

• distinguish voluntary requests from employer-imposed transfers;
• respect maternity-health and lighter-work rights;
• avoid adverse treatment because of pregnancy;
• document genuine business necessity;
• examine commuting and childcare consequences;
• avoid automatic demotion or salary reduction;
• obtain genuine, informed consent where consent is relevant; and
• ensure that the transfer is not merely a disguised response to pregnancy or exercise of a statutory right.

The central principle emerging from the Japanese cases is that ordinary employer personnel authority continues to exist, but it operates within statutory protections designed to prevent employees from suffering disadvantage because they exercise pregnancy, childcare or caregiving rights.