Before 2006, an employee who wanted to challenge a dismissal or claim unpaid wages had to choose between slow civil litigation and administrative mediation with no binding outcome. The Labour Tribunal Act created a middle route. A panel of three, one career judge and two part-time members with labour relations experience, one usually from the employer side and one from the worker side, hears the case at a district court.
The defining feature is speed. The law limits the procedure to three hearings, and the panel tries to mediate throughout. In practice, most of the argument happens at the first hearing, so both sides must file their full case and evidence at the start. Court statistics show around 70% of cases end in a mediated settlement, and the average length is roughly three months.
If no settlement is reached, the panel issues a tribunal decision. Either side may object within two weeks, in which case the decision lapses and the case moves automatically into ordinary litigation. Otherwise it becomes binding.
What it means for a foreign employer
- The timetable is short and front-loaded. The employer typically has only a few weeks to file a full written response in Japanese. Instruct counsel and gather documents immediately.
- It is designed to produce a payment. Dismissal cases commonly settle by the employee agreeing to leave in return for a sum. The amount reflects the panel's view of how weak the dismissal was.
- Someone with authority must attend. Panels expect to settle at the hearing, so a representative who can agree a figure on the day saves a round.
- Weak cases stay weak. A dismissal that would struggle in court will struggle here too. Use the risk as a reason to negotiate exits before they reach the tribunal.
Sources
- Labour Tribunal Act (Act No. 45 of 2004), in force April 2006.
- Supreme Court of Japan, judicial statistics on labour tribunal cases.