This summary of age discrimination law in Japan has been prepared by Anderson Mori & Tomotsune

Overview

There are no laws which specifically address age discrimination.  While the Labour Standards Act (the "LSA") includes a provision which states that "[e]mployers shall not engage in discriminatory treatment with respect to wages, working hours or other working conditions by reason of the nationality, creed or social status of any employee" (Article 3 of the LSA), it is silent on including "age" as a ground for discrimination.  Nevertheless, discriminatory treatment based on the age of an employee can be null and void because it is antagonistic to public order and morals (Article 90 of the Civil Law), and it can be the basis of a tort action (Article 709 of the Civil Law).

Furthermore, Article 9 of the Act on Comprehensively Advancing Labour Measures, and Stabilizing the Employment of Workers, and Enriching Workers' Vocational Lives (the “ACALM”) specifically addresses the issue of age for the purpose of promoting employment for people of all age groups.  Among other things, Article 9 prohibits age-based restrictions when recruiting and hiring.  It also requires employers to provide employees with equal recruitment and hiring opportunities regardless of their age pursuant to the provisions of the Ordinance of the Ministry of Health, Labour and Welfare.  However, there are certain exceptions to that requirement which may apply.

Who’s covered?

Article 9 of the ACALM applies to people of all age groups.

What enforcement/remedies exist?

Japanese law does not regulate age discrimination.  If an employer does not comply with Article 9 of the ACALM and implements age restrictions with respect to its recruiting and hiring practices, such an employer cannot be punished, because criminal or civil enforcement is beyond the scope of the ACALM.   However, the Minister of Health, Labour and Welfare can impose certain measures on an employer such as issuing administrative guidance and advice or a recommendation (Article 33 of the  ACALM).  Moreover, based on Article 5-6 of the Employment Security Act, the Public Employment Security Office (or an employment placement business provider (Shokugyo-shokai-jigyosha)) can restrict the employer from publishing its job openings. Employees have no remedy for violations of Article 9 of the ACALM.

How common are claims?

Age discrimination claims are rarely filed.

What claims are most common?

As above.

What are the trickiest issues for employers?

It seems that any age discrimination case on the basis of Articles 90 or 709 of the Civil Law have been allowed, thereby finding that certain acts taken by the employer are null and void.

Are there any specific exceptions in your laws?

The exceptions to the application of Article 9 of the ACALM  are as follows (Article 1-3 of the Ordinance for Enforcement of the ACALM):

• When recruiting and hiring applicants for non-fixed term employment contracts, the employer can stipulate that the applicant should be within the retirement age limit of 60 or above, depending on the retirement age adopted by the employer, in order to be eligible for the role;

• In cases where age restrictions are established under the provisions of the LSA and other applicable laws and regulations, the employer can recruit from a certain age group in accordance with the applicable laws;

• When recruiting and hiring people without job experience (i.e., graduates, etc.), for non-fixed term employment contracts, the employer can restrict the age limit and employ only young individuals thereby providing them with training, and establish their careers on a long term basis;

• In the case where employers have very few people in a certain age group and in a specialised occupation when compared with employees from other age groups in the same specialised occupation, the employer can recruit and hire employees from a certain age group on a non-fixed term employment basis in order for the employer to function in a smooth manner and carry forward the acquired skills and knowhow to the next generation of employees and in order to bridge the gap;

• In cases where there are specific needs in the field of arts and entertainment, the employer can recruit an individual who fits the role; and

• In cases where an employer recruits and hires only those individuals who are 60 years or older or those who are subject to measures to promote employment of a certain age group (limited to cases where the government policies are utilised).

Retirement ages

Article 8 of the Act on Stabilisation of the Employment of Elderly Persons (the "Act") prohibits the stipulation of a retirement age which is below 60.  According to the Working Conditions Comprehensive Survey, which was conducted in 2022 by the Ministry of Health, Labour and Welfare (the "MHLW"), approximately 72% of companies have established 60 as their retirement age, and approximately 25% of companies have established 65 as their retirement age.

However, to ensure stable employment until the age of 65, Article 9, Paragraph 1 of the Act requires employers who stipulate a retirement age to: (i) increase their established retirement age up to 65; (ii) establish a continuous employment system up to the age of 65 (this continuous employment system pursuant to which the employer continues to employ a current employee after he/she reaches retirement age if that employee wishes to continue being employed.)[1]; or (iii) abolish their established retirement age.  According to the MHLW, as of 2022, approximately 70% of employers that had stipulated a retirement age of 60 have now extended it to have a continuous employment system as mentioned in item (ii) above.  Many such employers have implemented a system to conclude a one-year-term employment contract after the employee reaches the retirement age of 60.

In addition, to ensure stable employment from the age of 65 until the age of 70, Article 10-2 of the Act amended in 2021 provides that employers who stipulate a retirement age must make best efforts to: (iv) increase their established retirement age up to 70; (v) establish a continuous employment system up to the age of 70; (vi) abolish their established retirement age, or (vii) introduce measures to support business startup. According to the MHLW, as of 2022, approximately 28% of employers that had stipulated a retirement age of 60 have now taken one or more action of as mentioned in item (iv)-(vii) above.

Employers are not prohibited from changing an employee’s working conditions (e.g., working days, wages, etc.) after he/she reaches retirement age.  However, Japanese law prohibits different working conditions between indefinite-term employees and definite term employees or part-time employees which result in unreasonable treatment towards the definite term employees (Article 20 of the Labour Contract Act (the “LCA”), and Article 8 of the Act on Improvement of Personnel Management and Conversion of Employment Status for Part-Time Workers and Fixed-Term Workers (the “Part-Time/Fixed-Term Workers Act").  Employees may seek remedies under the law for violations.  If an employee's working conditions are changed to the disadvantage of such a worker and antagonistic to Article 20 of the LCA or Article 8 of the Part-Time/Fixed-Term Workers Act after he/she reaches retirement age, such changes will be deemed to be null and void by Japanese courts, and such employee shall be awarded compensation for the damages suffered.

[1] If, before April 1, 2013, an employer set certain eligibility requirements for participation in the continuous employment system under a labour-management agreement and introduced its own system based on such requirements, the employer can, until March 31, 2025, continue to apply such requirements only to those employees who have reached a certain age (Such age shall be set at 61 from April 1, 2013, to March 31, 2016, at 62 from April 1, 2016, to March 31, 2019, at 63 from April 1, 2019, to March 31, 2022, and at 64 from April 1, 2022, to March 31, 2025.).  This is an interim measure taken for the purpose of avoiding the occurrence of a period during which the employment of certain employees may discontinue and no pension will be paid to such employees as a result of increasing the age at which employees can start to receive old-age employees' pensions.