What the court decided
A labour standards inspection office in Sapporo awarded medical and lost-earnings benefits to an employee of the Anshin Foundation, finding the illness work-related. The foundation sued to cancel the award. Its premium is set under the merit system, which raises or lowers the rate for larger employers according to benefits paid on their own claims over three years, so it argued the award would raise its premiums.
The Tokyo High Court accepted that the employer had standing to sue. The Supreme Court, First Petty Bench, unanimously reversed and restored the dismissal of the case. Workers' compensation decisions are made for the injured worker and are meant to be settled quickly. A benefit that did not objectively meet the conditions for payment cannot be counted when the employer's premium is calculated. So the award does not itself affect the employer's legal interests.
The employer is not left without a remedy. When it challenges its own premium assessment, it can argue that the premium was inflated by a benefit that should not have been paid.
Why it matters
The ruling protects workers' awards from being reopened by employers, while giving employers a defined route to contest the premium effect. It matters most for stress and harassment claims, where employers often dispute that illness was caused by work.
Action for employers
- Know whether the merit system applies to you. It depends on the size of the business and its premium base; check with your labour and social security attorney.
- Record your view at the time of the claim. If you think a claim is not work-related, say so to the inspection office with evidence when it investigates.
- Use the premium route. Contest an inflated rate through an objection to the premium assessment, within the time limits.
- Do not let the dispute touch the employee. Challenging the premium effect is no reason to treat the claimant differently.
Sources
- Act on the Collection of Labour Insurance Premiums, Article 12(3); Industrial Accident Compensation Insurance Act.
- Supreme Court, First Petty Bench, judgment of 4 July 2024, Case No. 2023 (Gyo-Hi) 108 (Anshin Foundation case).