Rethinking Workplace Regulation: Beyond the Standard Contract of Employment

10. New Forms of Dispute Resolution: Japan’s Labor Tribunal System

174 Chapter 10 New Forms of Dispute Resolution: Japan’s Labor Tribunal System takashi araki W hen labor contracts become unstable, atypical, nonstandard employment becomes prevalent, and employment mobility increases , labor disputes tend to come to the surface. Under the long-term and stable employment relationship, employees are hesitant to file claims with courts and other external dispute resolution organs, fearing that such actions might damage their relationship with their employer and not pay off in the long run. Therefore, complaints, if any, tend to be dealt with by in-house dispute resolution procedures. Once employment relations are terminated, by contrast, employees are free to make claims against former employers in courts or other external forums without fearing future disadvantage. Diversification of the workforce and individualization of human resource management, such as performance -based remuneration systems, have further accelerated an increase in individual labor disputes. The decline in union representation in most industrialized countries has also led to employees having to defend themselves by filing individual complaints. In fact, industrialized countries have experienced a surge in labor litigation , and some have introduced countermeasures to deal with overloaded labor tribunals. For instance, in the United Kingdom, the Employment Act 2002 requires parties to a labor dispute to attempt to resolve it through in-house procedures before filing the case with the Employment Tribunal.1 In Germany, revision in 2003 to the Dismissal Protection Act (Art. 1a, Dismissal Protection Act) was also intended to promote monetary solutions to dismissal disputes without needing to file the case in labor courts.2 Other countries, such as the United States, where parties to labor disputes want to avoid litigation costs, loss of time and privacy, and so on, have developed methods of private alternative dispute resolution (ADR). New Forms of Dispute Resolution 175 Similarly, Japan, which has long been believed to be a less litigious country, has experienced a rapid increase in individual labor disputes over the last two decades. To cope with these changes, Japan introduced a new labor dispute resolution system in 2006 called the labor tribunal system (Roudou Shinpan). The labor tribunal, consisting of one professional judge and two lay judges recommended by labor and management, is not an independent court, but rather a forum established in each district court. Although many countries encourage private settlements and ADR to minimize the number of complaints filed with courts, Japan has established a new dispute resolution mechanism in the court system that encourages parties to individual labor disputes to bring their cases to courts. This chapter examines why Japan has taken a different approach toward the increase in individual labor disputes, why a tripartite bench that includes lay judges was adopted, how the lay judge participation has been regarded in Japan, and how the introduction of the labor tribunal system has altered the notion of justice in labor relations. The main focus of this chapter is on the individual dispute resolution system of rights disputes in contrast to the collective dispute resolution system of interest disputes (see also Gladstone 2007). A review of the limitation of the traditional workplace-centered institutions, such as in-house dispute resolution systems and enterprise-based unions, confirms the need for new dispute resolution mechanisms for nonstandard employees and terminated employees expelled from the traditional long-term employment relationship. At the same time, this chapter examines whether the new system—one that prioritizes speedy, flexible, and resolutionoriented justice and uses labor experts rather than time-consuming precise justice provided by professional judges—changes the nature of employee protection or workplace justice. By so doing, it reconsiders how employee protection and dispute resolution can respond to the real needs of the diversified workforce. overview of labor Dispute Resolution Systems in Japan One of the features of Japan’s labor dispute resolution system is that Japan did not have a separate court for resolving individual labor disputes , such as those found in European countries (see figure 10.1). In many European systems, labor disputes are heard by lay judges representing the interests of labor and management. For instance, both labor courts in Germany (Arbeitsgerichte) and employment tribunals in the United Kingdom are tripartite organs, whereas French labor courts (conseil de prud’hommes) have bipartite membership. But though Japan has had a system of tripartite labor relations commissions since 1945, these are administrative and deal only with collective labor disputes.3 176 Rethinking Workplace Regulation Previously, all individual labor-related...