"「最高裁は非正規を見ていない」　東京メトロ売店の「退職金ゼロ」、逆転敗訴した契約社員の悲嘆", 13 Oct 2020

[Excerpt translation from Japanese to English provided by the Business & Human Rights Resource Centre.]

On 13 October [2020], the Supreme Court reversed the Tokyo High Court’s decision in a case brought forth by former contract employees of Metro Commerce, a Tokyo Metro subsidiary that operates concession stands. In their lawsuit, the workers sought severance pay, which its former employer gave to regular workers [but not to irregular workers]…

The central point in the case was Article 20 of the Labour Contract Act, which prohibits unreasonable disparities based on fixed-term employment. The Tokyo High Court ruled that it was unreasonable for Metro Commerce to deny severance pay and determined that the company must give the plaintiffs a quarter of the severance pay given to regular workers…

The Supreme Court ruled that the purpose of severance pay is to secure and retain regular employees.

While the contract workers in this lawsuit shared similar responsibilities with regular workers…the court said that “it could not ignore a certain degree of difference [between these two types of employees].” The judges also pointed out that regular workers faced the possibility of job transfers, which did not apply to irregular workers.

In addition, the court considered other factors, such as the fact that few regular workers were involved in operating convenience stores; disparities between regular and irregular workers, such as types of job responsibilities and the possibility of job transfers; and the existence of a promotion system whereby contract employees could take an exam to become regular workers. As a result, the court found that “it could not say with certainty whether it was unreasonable” for Metro Commerce to deny severance payments to the plaintiffs.

…However, the court decision was not unanimous, with Judge Katsuya Uga voicing dissent out of the five judges.

...Uga pointed out that it was not unusual for contract employees at Metro Commerce to have longer employment histories than regular workers. Furthermore, he could not find major disparities between the two types of workers with regards to their job responsibilities and transfers. He ruled that the Supreme Court should have dismissed the appeals from both the employer and the workers, accepting the decision of the lower court.

…Article 20 of the Labour Contract Act has been integrated into Article 8 and 9 of the Part-Time/Fixed-Term Employment Act [which went into effect in April 2020]. However, unlike the issue of bonuses, specific rules on severance pays to irregular workers are not included in employment guidelines, such as those published by the Ministry of Labour, Health and Welfare…