In a haken arrangement there are three parties. The agency employs the worker, pays them and carries the employer's legal duties. The client, which Japanese law calls the host, directs the day-to-day work. All dispatch businesses need a licence from the Minister of Health, Labour and Welfare.
The 2015 reform set two clocks. The individual limit means the same fixed-term dispatched worker cannot work in the same organisational unit of a client, such as a section, for more than three years. The site limit means a client cannot use dispatched workers at the same establishment for more than three years unless it consults its majority union or employee representative and extends. Workers whom the agency employs on open-ended contracts, and those aged 60 or over, are outside the limits. Day dispatch, meaning contracts of 30 days or less, has been prohibited in principle since 2012.
From April 2020, agencies must either match the pay of comparable staff at the client or set pay through a labour-management agreement meeting a statutory benchmark. Clients must give the agency information on their own staff's pay to make this work. A further rule bites on the client directly: if it knowingly uses dispatch unlawfully, for example beyond the period limits, through an unlicensed agency or by disguising dispatch as outsourcing, it is deemed to have offered the worker direct employment on the same terms.
What it means for a foreign employer
- Good for support roles, not leadership. Dispatch suits administrative and project work. Clients are not supposed to pre-select individual workers by interview, except under temp-to-perm arrangements.
- Track the three-year clock. An excellent dispatched assistant must move unit, be hired directly or leave at three years.
- Mind the deemed offer. Overstaying the limits or directing a vendor's staff as if they were dispatched can create an employment relationship you did not plan for.
- Price it fully. The hourly rate includes the agency's margin, social insurance and, since 2020, equal-pay adjustments.
Sources
- Worker Dispatch Act, as amended in 2012, 2015 and 2018 (equal-pay provisions in force 1 April 2020), including Article 40-6 on deemed offers of employment.