When the Act was passed in 1985, it legalised dispatch only for a short list of specialist jobs. In 1999 the approach was reversed: dispatch became allowed in principle, with a list of prohibited work. Manufacturing dispatch followed in 2004. After the 2008 financial crisis, when large numbers of dispatched factory workers lost their jobs at once, the law moved back towards protection. A 2012 amendment banned day dispatch in principle and limited dispatch within a corporate group to no more than 80% of an agency's total. In 2015 the lighter registration route for some agencies was abolished, so every dispatch business now needs a licence, and the three-year period limits were introduced. Equal-pay rules followed in 2020.
Some work cannot be dispatched under any arrangement: port transport, construction, security guard work, and most medical work in hospitals and clinics, with exceptions. Several licensed professions are also excluded.
The Act places duties on the client, not only on the agency. The client must appoint a person responsible for dispatched workers, keep a ledger for each one, respect the period limits, give the agency information on its own staff's pay, and offer dispatched workers access to facilities such as canteens on the same basis as its own staff. A further revision to the regulations and guidelines, in force from 1 October 2026, adds to the explanations agencies must give workers about pay differences.
What it means for a foreign employer
- You are a regulated party. Using agency staff makes your Japan entity a client under the Act, with its own records and duties. Assign someone to own them.
- Check the label on outsourcing. If you direct a contractor's people day to day, regulators may treat it as disguised dispatch, with the deemed-offer risk explained under haken.
- Use only licensed agencies. Each licence number can be checked on the ministry's public database before you sign.
- Group secondment is different. Moving staff between group companies is usually done as shukko, not dispatch, and needs its own documentation.
Sources
- Act on Securing the Proper Operation of Worker Dispatching Undertakings and Improved Working Conditions for Dispatched Workers (Act No. 88 of 1985), as amended in 1999, 2003, 2012, 2015 and 2018, Article 4 (prohibited work).
- Ministry of Health, Labour and Welfare, amended enforcement regulations and guidelines in force 1 October 2026.