Foreign Companies Fail at Japan’s Annual Leave Obligations

Employer's Annual Leave Obligations.

Your employees in Japan might now be taking some of their annual leave (yukyu) to celebrate the Obon holidays, visit relatives, and enjoy the celebrations. But some may not. What should employers do when employees fail to utilize their annual leave? Can employees choose to go a year without using any annual leave?

Perhaps surprising to Westerners, the answer to this question is a resounding “no.” A 2019 survey by the Japan Ministry of Health, Labour and Welfare determined that workers in Japan only take 52.4% of their entitled paid leave. Much of this is due to a culture of overwork. In Japan, this is a health and safety issue. For decades, the government has mandated that a minimum number of days of annual leave must be granted to employees—part time, full time, and contract employees. But by 2019, it was clear that employees were not utilizing enough annual leave to have the desired health benefits.

To counter this disturbing statistic, a 2020 law required employers to “ensure” that employees entitled to 10 days or more of annual leave must take at least 5 of those days each year. Employers who fail to enforce this may be sanctioned.

No longer is taking annual leave solely left to the discretion of employees. As part of the work-life balance initiatives, this burden has fallen on employers. Have your employees taken the required number of days of annual leave? How do you calculate when the dates should start and end? How do employers logistically manage this new burden with their workforce? Contact Japan Employment Solutions K.K. We can help.

For assistance in Japan legal compliance, contact the Japan and US employment law experts at www.japan-employment.com We understand Western and Japanese employment law compliance and explain them in a way you can understand and follow. We are your trusted advisors for Japan employment compliance.