The three year rule for dispatched workers, and what it adds when they are foreign nationals
If your company uses dispatched staff, the three year rule in the Worker Dispatch Act is the one to keep in view. The 2015 amendment that took effect on September 30, 2015 applied two kinds of period limit to every type of work (MHLW page on the amendment, in Japanese). The same rules apply to foreign dispatched workers as to Japanese ones. Here is how they work, and what is added when the worker is a foreign national.
Two period limits
| Limit | What it says | Article |
|---|---|---|
| Per workplace | A workplace may receive dispatched workers for up to 3 years in principle. To extend, the client must hear the opinion of the majority union or employee representative at that workplace by one month before the conflict date. Each extension is for up to 3 years | Article 40-2 (in Japanese) |
| Per worker | The same dispatched worker may work in the same organizational unit (a section, for example) of the same workplace for up to 3 years. Extending the workplace limit does not extend this one | Article 40-3 |
Article 40-2 paragraph 1 exempts workers on open ended contracts with the dispatch agency, fixed term project work, work limited to a small number of days a month, and cover for maternity, childcare or family care leave. The MHLW leaflet for client companies (in Japanese) also lists workers aged 60 or over as exempt.
The guideline on measures client companies must take (in Japanese) describes an organizational unit as a section or group whose work is similar or related and whose head has authority over assigning work and supervising staff. It also says that a gap of three months or less between one dispatch and the next counts as continuous, and that pausing for just over three months to avoid the extension procedure goes against the purpose of the law.
The conflict date and the extension procedure
The first day on which a dispatch would violate a limit is the conflict date (teishokubi). Before signing a new dispatch contract, the client must notify the agency of the workplace conflict date (Article 26 paragraph 4). Without that notice the agency may not sign (paragraph 5). The agency in turn tells the worker both conflict dates (Article 34).
To extend the workplace limit, the client hears the majority union or representative within the opinion period, explains its reasons if they object (Article 40-2 paragraphs 4 and 5), and promptly notifies the agency of the new conflict date (paragraph 7).
Break the limit and you are deemed to have offered a job
Under Article 40-6, a client that receives a dispatched worker in violation of either limit is deemed, at that moment, to have offered the worker a direct employment contract on the same conditions they had with the agency. The exception is a client that did not know and was not negligent in not knowing. The deemed offer cannot be withdrawn for one year. The Minister of Health, Labour and Welfare can also issue a corrective recommendation and publish the company's name if it is ignored (Article 49-2).
Stabilization measures and the client's duties
The agency must take one of four measures for a fixed term dispatched worker expected to work three years in the same organizational unit (Article 30). For one to three years it is a best effort duty. The measures are: asking the client to hire the worker directly, providing a new reasonable assignment, hiring the worker on an open ended contract at the agency, or other measures such as paid training or temp to perm dispatch. The MHLW overview of the amendment (in Japanese) adds that if the direct hire request does not lead to a job, the agency must take one of the other measures as well.
The client has duties too. If it has used the same worker in the same unit for one year or more, the agency asks it to hire the worker, and it then wants to hire someone for the same work after the dispatch ends, it must make an effort to hire that worker. It must also share regular employee job openings with dispatched workers it has used for one year or more at that workplace.
What changes when the worker is a foreign national
Nothing in the limits or the measures depends on nationality. What is added is residence status. If you hire a dispatched worker directly, someone on a status such as Engineer/Specialist in Humanities/International Services or Specified Skilled Worker must notify the ISA within 14 days of the change in contracting organization (Article 19-16 of the Immigration Act, in Japanese). As the new employer you file the foreign employment notification with Hello Work. And Specified Skilled Worker status allows dispatch only in agriculture and fishery (our SSW guide).
As the dispatching employer, Sincero Global tracks conflict dates, informs each worker of them, and carries out the stabilization measures. We ask client companies to notify us of the conflict date before the contract and to run the opinion hearing when they extend. If you are thinking about hiring a dispatched worker directly as their three years approach, we handle the status check and the changeover paperwork with you. Reach us by phone at +81 90 7841 8887, by email at info@sinceroglobal.jp, or on LINE.
