In April 2024, the “clarification of working conditions” will be revised. Clarification of working conditions is required by the Labor Standards Act, and it is important to understand them accurately as violations may result in penalties.
Companies will be required to respond appropriately to revisions to explicit labor conditions. However, there are probably many people who are worried that they don’t know what the revision will change or what they should do.
In this article, we will introduce specific details regarding the revision of labor conditions specification. Please use this as a reference as we will explain the measures that companies should take and precautions to take.
1. What is the April 2024 amendment to rules clarifying working conditions?
Labor conditions will be revised on April 1, 2024 (Reiwa 6). The purpose of clarifying working conditions is to prevent labor-management troubles and protect workers after an employment contract is concluded.
According to Article 15, Paragraph 1 of the Labor Standards Act, “Clarification of working conditions,” companies are required to clearly state the working conditions when hiring employees. When hiring, a “Notice of Working Conditions” must be issued.
If the stated working conditions differ from the facts, the worker will be asked to cancel the labor contract. Items can be categorized into items that require written documentation and items that require verbal documentation.
| Clarifications that require delivery of documents | Matters that may be specified orally |
| Term of labor contract Work location/work content Start/end time Whether there is work that exceeds the prescribed working hours Break time Holidays/Vacations Matters regarding changes in work hours during shift work Wage determination, calculation and payment methods Matters regarding wage deadlines and payment timings Matters related to retirement, including reasons for dismissal |
Matters regarding salary increases
Matters regarding the scope of application of retirement allowance Matters regarding payment method and timing of retirement allowance Matters regarding temporary wages and bonuses Matters related to worker burden Matters related to health and safety Matters related to vocational training Matters regarding accident compensation and work-related injuries and illness assistance Matters regarding sanctions and awards Matters regarding leave of absence |
Four new items will be added as a result of the amendment to the labor conditions specification. Companies will be required to accurately understand the new clarification items and respond appropriately.
2. Four items added and revised content under the rules clarifying working conditions
The following items will be added in the revision of the labor conditions specification.
- Clarify the scope of changes in work location and duties
- Clarification of update limit
- Clarification of application opportunities for indefinite conversion
- Clarification of working conditions after indefinite conversion
We have summarized the target audience, specific content, and when to clarify.
2-1．Clarify the scope of changes in work location and duties
All workers will be required to clearly state the scope of changes to their workplace and duties. It will be easier to understand if you consider that the scope will be added to the “place of work” and “contents of work” that were required before the revision.
It is required to indicate this at the time of concluding a labor contract or renewing a fixed-term employment contract. The scope of change refers to the scope of work locations and duties that are expected to change due to future reassignment.
On the other hand, in the case of full-time employees whose employment is assumed to be long-term, it may be difficult to clarify the scope of changes at the time of signing the labor contract. Care must be taken as there may be discrepancies between the facts and the facts after employment.
In cases where it is difficult to predict, please describe the scope of the change in work location and duties as broadly as possible. In addition, please clearly state the clauses regarding reassignment in the work regulations and the right to give orders based on personnel rights.
2-2. Clarification of update limit
After the revision of the clearly stated working conditions, it is necessary to “clarify the upper limit for renewal” for fixed-term contract workers. The renewal limit refers to the total contract period or the maximum number of renewals for a fixed-term contract.
When concluding and renewing a fixed-term labor contract, it is important to clearly state whether there is a renewal limit and the details. Furthermore, in the following cases, explanations to fixed-term contract workers are required.
- When establishing a new renewal limit after the initial contract is concluded
- When shortening the renewal limit set at the time of the initial contract conclusion
When establishing or shortening the renewal limit, it is important to carefully explain the detailed reasons in advance. Prepare in advance so that you can explain your reasons smoothly.
2-3．Clarification of the opportunity to apply for indefinite conversion
After the revision of the labor conditions specification, it is necessary to clearly state to fixed-term contract workers that it is possible to apply for conversion to an indefinite term contract. In accordance with the “Indefinite Conversion Rules,” this indicates the timing at which the “Indefinite Conversion Application Right” occurs.
Indefinite-term conversion rules are rules that allow fixed-term workers to convert their contracts into indefinite-term labor contracts (labor contracts with no fixed period) upon application. When a fixed-term labor contract is renewed for more than five years, the right to apply for indefinite-term conversion arises.
For example, if the contract period is one year, you can apply for one year after the fifth renewal, and if the contract period is three years, you can apply for three years after the first renewal. If you apply, an indefinite labor contract will be established.
2-4．Clarification of working conditions after indefinite conversion
The amendment to the specification of working conditions will require the “working conditions after indefinite conversion” to be clearly specified. Just as clearly indicating the opportunity to apply for indefinite conversion, it is important to indicate the timing when the right to apply for indefinite conversion occurs.
We decide on working conditions after considering the balance with regular employees, and provide explanations to fixed-term contract workers. When determining working conditions, take into account the principle of “equal pay for equal work,” which prohibits unreasonable differences in treatment between regular and non-regular workers.
3. Three actions companies should take when revising rules to clarify working conditions
We have summarized three measures that companies should take before the revision of the labor conditions specification.
- Review of working conditions notice
- Reconfirmation of renewal limit for fixed-term contract workers
- Understanding fixed-term contract workers to whom the indefinite conversion rule applies
Check out what you need to do and be prepared.
3-1．Review of working conditions notice
In order to respond to amendments to clearly stated working conditions, it is necessary to review the working conditions notice. You will need to create a new one with four additional items in mind.
The Ministry of Health, Labor and Welfare has released an image of the revised working conditions notice, so please refer to it. For clauses that are difficult to include in the notice of working conditions, consider stating them clearly in the employment regulations.
3-2．Reconfirmation of renewal limit for fixed-term contract workers
In order to respond to the explicit renewal limit, we will confirm the number of contract renewals and total period for fixed-term contract workers. It is important to check the current working conditions.
When concluding and renewing a fixed-term labor contract, be prepared to clearly state whether there is a renewal limit and the details. When establishing or shortening the update limit, it is important to summarize the detailed reasons for explanation.
3-3．Understanding fixed-term contract workers to whom the indefinite conversion rule applies
We will list fixed-term contract workers to whom the indefinite conversion rule applies. Please clarify the timing of each indefinite conversion application right.
At the same time, it is important to organize the work within the company and consider the working conditions after the indefinite-term conversion. The working conditions after indefinite-term conversion must be clearly stated in writing, so be prepared.
4. Two points to note regarding amending rules for clarifying working conditions
There are two points to keep in mind in order to respond to the revised rules clarifying working conditions:
- Companies cannot refuse applications for indefinite conversion.
- You will not become a full-time employee even after converting to an indefinite period.
Please check in advance to avoid trouble with your workers.
4-1．Companies cannot refuse applications for indefinite conversion.
If a fixed-term contract worker is offered a permanent contract, the company cannot refuse. An indefinite labor contract will be established once the application is submitted.
Termination of employment (refusal to renew the employment period) after an application has been made is prohibited. It is also undesirable to terminate employment before the right to apply for indefinite conversion occurs in order to avoid the indefinite conversion rule.
Furthermore, the amendment to the Employment Termination Notice will no longer allow companies to unilaterally establish or shorten the renewal limit. It will be necessary to give an explanation in advance, and you will be asked to respond carefully.
Legally speaking, it is valid to make an application verbally, but there is a risk that a dispute will arise later as to whether the application was made or not. When you receive an application, it is recommended that you provide a written document to the worker.
4-2. You will not become a full-time employee even after converting to an indefinite period.
Even if an indefinite-term labor contract is established, a fixed-term contract worker does not become a permanent employee. This simply changes the fixed-term labor contract to an indefinite-term labor contract, allowing you to work without a fixed contract period until retirement.
Therefore, there is no need to apply the same working conditions as regular employees. There is no problem if you simply change the employment period to indefinite term while maintaining the same working conditions as before the conversion to indefinite term.
Since there is no upper limit to the working period for indefinite-term convertible employees, the retirement age is determined by the employment regulations. It is also recommended to set a second retirement age in case an employee becomes an indefinite-term convertible employee beyond the retirement age.
5. Understand the details of the explicit amendments to working conditions
The April 2024 amendment to the Labor Conditions Explanation will add four clarifications. In case of violation, a fine of up to 300,000 yen may be imposed, so companies will be required to take appropriate measures.
In order to avoid trouble with workers, it is important to understand three actions that companies should take and two points to be careful of. Please be prepared to strictly comply with the revised working conditions.
