|GH 2017 Japan|
Distinction of employees and independent contractors is one of the most important issues in the workplace in Japan, due to the prevalence of what administrative authorities viewed as misuse of the usage of independent contractors by employers. A recent amendment to the Worker Dispatch Act has been implemented from October 1, 2016, which now deems that if a scheme utilizing independent contractor is considered “contractor-in-disguise” (employment done in the form of usage of an independent contractor), the recipient (client) is deemed to have offered employment to the independent contractor (if the independent contractor is a company, to its employees working for the client), so if the worker wishes to be employed, an employment contract will become established.
The one structure that is an exception is the use of dispatched workers employed by a licensed worker dispatch company. While there are a number of rules to comply with to start and continue use of labour service provided by dispatched workers, utilization of dispatched worker is one exception legally allowed to directly receive labour of non-employees.