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General Corporate

Understanding the Differences in Work Styles: Explaining the American 'Japanese Labor Standards Act

General Corporate

Understanding the Differences in Work Styles: Explaining the American 'Japanese Labor Standards Act

In the United States, there are different work styles and labor standards compared to Japan. When employing personnel in the U.S., it is crucial to deepen your understanding of the work environment and legal personalityistics.

This article focuses on the U.S. labor standards law, explaining the differences from Japan. It is important to be aware of the differences in workers’ rights and working conditions that arise from different cultures and legal systems. This is a must-read for those seeking information on employment in the U.S. and for legal professionals in companies considering international expansion.

Essential Knowledge for Employment in the United States

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In the United States, employment encompasses unique concepts such as “Employment at Will” and the “Employee Handbook.”

“Employment at Will” signifies the principle of voluntary employment. It is a foundational concept in American employment, allowing both employers and employees to terminate the employment relationship without agreement, and enabling dismissal or resignation at any time unless there are explicit contractual terms. However, this does not include discriminatory dismissals or terminations based on illegal reasons.

The “Employee Handbook” is a document that many companies create and provide to their employees. It compiles the company’s rules, policies, and benefits, and is crucial for workers to access information related to their employment. The handbook also serves as a legal document, outlining the rights and obligations of workers, employment conditions, and welfare programs.

Understanding these concepts is essential when engaging in employment in the United States. Employers are required to comply with legal regulations and to provide a fair and transparent employment environment.

Labor-Related Laws in the United States

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The key labor-related laws in the United States are as follows:

  • Fair Labor Standards Act (FLSA)
  • Occupational Safety and Health Act (OSHA)
  • Family and Medical Leave Act (FMLA)

In the United States, each state has its own constitution separate from the federal government, and employment and labor regulations are divided between those established by the federal government and those by the states.

Fair Labor Standards Act

The Fair Labor Standards Act (FLSA) is one of the most significant labor laws in the United States, enacted to protect the rights and working conditions of employees.

This law sets standards for minimum wage, working hours, overtime pay, and age requirements for workers. The FLSA applies nationwide, mandating all employers to comply with minimum wage payments, working hour restrictions, and the provision of overtime pay. It also includes special protections for workers under the age of 18.

Reference: Council of State Governments | Basics of U.S. Employment Law[ja]

Occupational Safety and Health Act

The Occupational Safety and Health Act (OSHA) is a law designed to ensure the safety and health of workers in the workplace.

This law requires employers to comply with occupational safety standards to provide a safe working environment. OSHA mandates training and information for workers, guidance on handling hazardous materials, and the provision of appropriate protective equipment. Employers are obligated to adhere to occupational safety and health standards, with regular audits and reporting also required.

Reference: Council of State Governments | Basics of U.S. Employment Law[ja]

Family and Medical Leave Act

The Family and Medical Leave Act (FMLA) is a law that grants leave for family and medical reasons. For instance, employees can take unpaid leave for the time necessary to address their own or a family member’s health issues. It also allows for leave to care for a newborn.

Under the FMLA, employers are required to provide up to 12 weeks of leave and arrange for the employee’s return to work after the leave period.

Reference: Council of State Governments | Basics of U.S. Employment Law[ja]

Wage Systems in the United States

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The wage system in the United States is complex, with both a federal minimum wage and individual state minimum wages in place.

Firstly, the federal minimum wage applies nationwide and sets the basic wage level that all states must at least guarantee. The current federal minimum wage is $7.25 per hour. However, some states consider this level insufficient relative to the cost of living and have set their own minimum wages.

Next, state-specific minimum wages allow each state to establish its own minimum wage. This is to ensure a more appropriate level based on the state’s economic conditions and cost of living differences. State minimum wages can be higher than the federal minimum wage, but they cannot fall below the federal standard.

Below is a list of minimum wages in some states (as of January 2024).

*Calculated at 1 USD = 145 JPY

StateMinimum Wage (USD)Minimum Wage (JPY)
New York$15.00¥2,175

As shown, minimum wages vary by state. Employers are required to pay wages according to the minimum wage of the state where the employee is located. Furthermore, if a worker’s place of residence and workplace are in different states, the minimum wage of the state of employment applies.

Minimum wage rates are regularly reviewed and may change. Employers should stay informed of the latest information to ensure they are providing the appropriate wage levels.

Systems Governing Working Hours in the United States

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The system governing working hours in the United States is primarily based on the Fair Labor Standards Act (FLSA). Below, we explain the key points related to working hours.

Working Hours Related ItemsProvisions Under the Fair Labor Standards Act (FLSA)
Working Hours and OvertimeWork exceeding 40 hours a week is considered overtime, and employees are entitled to receive overtime pay in addition to their regular wages. Overtime pay is set at 1.5 times the regular wage rate and is applicable when an employee works more than 40 hours in a week. However, certain job categories and highly compensated employees may be exempt from overtime pay.
Break TimeEmployees working more than 8 hours must be provided with a break of at least 30 minutes. This applies only to continuous work, and shorter breaks may be permitted multiple times. Break time is not deducted from the paid working hours of the employee.
Differences in Working Hours by Employment TypeRights and regulations regarding working hours vary depending on the type of employment, such as full-time or part-time workers. Full-time employees are subject to standard working hours and overtime pay, while part-time employees generally have their working hours and compensation set based on their contract.
Flexible Work ArrangementsEmployees and employers can set agreed-upon working hours (flex time) and schedules. This allows for flexibility while aiming to improve productivity.

As outlined above, there are legal regulations in place for working hours in the United States, ensuring the protection of workers’ rights. Employers and employees must agree based on the employment contract and type of employment, achieving flexible work arrangements while adhering to the legal framework.

Systems Governing Dismissals in the United States

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In the United States, there are two types of dismissals: individual and collective, each with different requirements and processes.

Firstly, individual dismissal refers to the case where an employer terminates the employment of a single worker. In most states, even when the employment contract is verbal or specified, employers must follow careful procedures if the employment is considered “at-will.” Individual dismissals should be conducted based on established processes and legal rights of the workers.

On the other hand, collective dismissals typically refer to situations where a large number of employees are terminated simultaneously. This usually occurs as part of a major workforce restructuring due to poor organizational performance, business model changes, or bankruptcy. In the United States, collective dismissals are subject to legal requirements under the Worker Adjustment and Retraining Notification Act (WARN Act). The WARN Act stipulates that companies with more than 50 employees must provide advance notice to the workers and the state if they plan to lay off 30 or more employees. This notice must include reasons for the dismissals and the anticipated schedule.

Both types of dismissals require a fair and equitable process. Proper notification and compliance with legal requirements not only protect the rights of workers but also minimize legal risks for employers. However, as requirements vary by state and specific employment contracts, it is crucial for both employers and workers to review relevant laws and seek professional advice to ensure appropriate measures are taken.

Latest Trends in American Employment Law

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Stay informed about the following three latest trends in American employment law:

  • Agreements related to antitrust law violations
  • Restrictions on the use of severance agreements
  • New FTC rules regarding non-compete obligations

These latest trends are essential for ensuring a fairer relationship between workers and employers. To minimize legal risks, it is crucial to respond promptly to related laws and regulations.

Agreements Related to Antitrust Law Violations

In the United States, there is a careful scrutiny to ensure that agreements between companies do not violate antitrust laws.

Antitrust laws are a system of laws designed to promote competition among businesses and industries and to prevent unfair competitive practices and monopolies. Enforcement has been intensified against agreements and alliances with competitors that may dominate the market and suppress competition. Companies should comply with antitrust laws to maintain a fair market environment.

Restrictions on the Use of Severance Agreements

In the United States, employers and employees typically enter into severance agreements when there is a dismissal or resignation. However, there are strict restrictions on the use of these agreements.

In particular, agreements that limit a worker’s right to sue their employer are not considered, ensuring that employees’ legal rights are adequately protected. This emphasizes the importance of a fair dismissal or resignation process.

New FTC Rules Regarding Non-Compete Obligations

The introduction of new rules regarding non-compete obligations by the Federal Trade Commission (FTC) is also significant. Non-compete obligations refer to the principle that workers or employees should not engage in competing businesses within a certain period after leaving their job.

As a result, employers must be cautious about the validity and fairness of non-compete agreements. Employers need to clearly explain the content and impact of non-compete agreements to workers and take measures to prevent illegal restrictions on workers.

Conclusion: Consult with Experts Familiar with Local Laws for Overseas Expansion

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In the United States, there is the Fair Labor Standards Act (FLSA), and if you become an employer, you should also be familiar with the Occupational Safety and Health Act and the Family and Medical Leave Act. Concepts unique to the U.S., such as “Employment at will” and the “Employee Handbook,” exist, and it’s important to understand the differences in work practices compared to Japan.

The regulatory framework governing labor standards in the United States can be complex and difficult to comprehend without legal expertise. We highly recommend consulting with experts who are knowledgeable about local legal matters.

Guidance on Measures by Our Firm

Monolith Law Office is a legal practice with extensive experience in IT, particularly in both the internet and legal fields. In recent years, global business has been expanding, and the need for legal checks by experts is increasing more than ever. Our firm provides solutions for international legal affairs.

Areas of practice at Monolith Law Office: International Legal Affairs & Overseas Business[ja]

Managing Attorney: Toki Kawase

The Editor in Chief: Managing Attorney: Toki Kawase

An expert in IT-related legal affairs in Japan who established MONOLITH LAW OFFICE and serves as its managing attorney. Formerly an IT engineer, he has been involved in the management of IT companies. Served as legal counsel to more than 100 companies, ranging from top-tier organizations to seed-stage Startups.

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