Pursuant to the amendment of Labor Contract Act established in 2012, an employee with a fixed term labor contract will have a right to make an indefinite term labor contract with the same employer in case such fixed term labor contract meets the following conditions;

(1) Because of repeated renewal of the contract, the aggregate term of the same
　　contracts reached 5 years.
(2) He/she makes an offer of making an indefinite term labor contract to the same
　　employer

While no employee has this right until April 1 2018, employers who have fixed term labor contracts must prepare for an offer from such employee.

Possible measures to be taken by employers are as follows;
(a) Make it a policy to reject any renewal of a fixed term labor contract to keep the
　　aggregate term of the contract shorter than 5 years.
(b) Make provisions in rules of employment that are applied to indefinite term employees
　　who will make an offer of making an indefinite term labor contract.　
(c) Take no measures, meaning to treat each employee with the right individually.

Employers can take a measure (b) as the amendment of Labor Contract Act solely relates to the term of labor contracts. Employers who would consider taking this measure had better to start to make a draft amendment of their rules of employment.


Establishment of exceptional cases to the employee’s right to make an indefinite term labor contract are under discussions at the Central Labour Standards Council.

Report by the Council on 14th February 2014 provides that “Special national qualification holders, engineers earning a salary of no less than 10.75 million yen with very good experience, system engineers and designers” are among the employees who cannot be given the right.