This article provides a brief overview of the Labor Standards Inspection Office (the “LSIO” (“労働基準監督署”)), the governing body responsible for supervising compliance with the Labor Standards Act (Act No. 49 of 1947, the “LSA”), which establishes the minimum standards and the coercive rules for employment conditions. Foreign companies’ subsidiaries in Japan are also subject to the LSIO’s supervision in relation to compliance with the LSA. This article will explain the LSIO’s role as the supervisory agency, its organizational framework, the various forms of inspections carried out, and the consequences of non-compliance.
1. Authority and Organization of the LSIO
Under Article 11 of the LSA, the LSIO is designated as the competent authority responsible for overseeing compliance with the Act. The labor standards inspection officers who usually belong to the LSIO, as provided in Article 97, Paragraph 1 of the LSA, are entrusted with the duty of supervision. Under Article 101, Paragraph 1 of the LSA, these officers are authorized to conduct on-site inspections of workplaces, while being obligated to keep confidential any investigation details, in accordance with Article 105 of the LSA. An employee may also report a violation of the LSA to these officers under Article 104 of the LSA. Furthermore, these officers may instruct the employer to submit a report based on Article 104-2, Paragraph 2 of the LSA. The LSIO is organized under the Labor Bureau in each prefecture; as of November 2020, a total of 321 LSIO offices and four branch offices were established nationwide, organized into divisions such as Regional Divisions (Supervisory Divisions) (“方面(監督課)”), Health and Safety Divisions (“安全衛生課”), Workers’ Accident Compensation Divisions (“労災課”), and Administrative Divisions (“業務課”).[1]
2. Types of Inspection Conducted by the LSIO
The LSIO undertakes three primary types of inspection, and the Regional Divisions (Supervisory Divisions) will handle the inspection case. First, regular inspections, referred to as Regular Inspections (“定期監督”), are proactive and systematic inspections conducted by the LSIO on selected target workplaces. Second, Report-based Inspections (“申告監督”) are initiated based on reports received from workers, as outlined in Article 104, Paragraph 1 of the LSA. Third, Accident-based Inspections (“災害時監督”) are carried out in response to reported labor accidents. Regular Inspections typically cover general matters such as working hours, overtime pay, and employment rules. Conversely, Report-based Inspections focus on specific allegations made by workers, while Accident-based Inspections involve detailed investigations into labor accidents that have already occurred.
3. Results of Investigations Conducted by the LSIO
Upon concluding on-site inspections, if no legal violations are found, the LSIO’s guidance ends. In cases where improvement is necessary despite there being no clear legal violation, the LSIO may issue a Guidance Notice (“指導票”). On the other hand, if legal violations are identified, a Recommendation for Improvement (“是正勧告書”) is issued. Both the Guidance Notice and Recommendation for Improvement require rectifying the situation within a specified period, and the LSIO must be notified of the corrective action taken. Notably, labor standards inspection officers are authorized to act as judicial police officers concerning offenses related to violations of the LSA. However, in severe cases of repeated non-compliance despite the issued Recommendations for Improvement, criminal proceedings may be initiated; in that case, the matter may be referred to a prosecutor.
4. Conclusion and Reference Information
In summary, this article has provided a brief overview of the LSIO’s authority, organizational structure, types of investigations conducted, and the outcomes thereof. Given the potential repercussions associated with interactions with the LSIO, seeking guidance from experienced professionals, such as licensed lawyers with expertise in LSIO matters, is highly recommended. For further understanding of LSIO practices, reference sources such as Akira Miyazaki et al., Q&A Practical Guide to Legal Responses to the Labor Standards Inspection Office’s Investigations (Chuo Keizai Sha, 2017) and Naoharu Fuse, Practical Guide to Dealing with the Labor Standards Inspection Office for Companies (Keiei Shoin, 2022) are invaluable.
