Japanese businesses expanding into the United States often focus on customers, site selection, and supply chains. But the greater shock usually comes from US workplace law. Labor and employment law in the States is decentralized, aggressively enforced, and often counterintuitive to Japanese executives accustomed to centralized and consensus-driven practices. And missteps can quickly escalate into costly litigation or reputational harm. Here are 10 critical employment law differences, each with a real-world example and a practical action item you can take to help ease your organization’s transition.
1. “At-Will” Employment Doesn’t Always Mean You Are Free to Terminate Workers
What to Know: Most US workers are employed “at will,” meaning they can be terminated at any time for almost any lawful reason. But exceptions – such as alleged discrimination or retaliation – create frequent lawsuits.
Example: In Brown v. Daikin America, a US employee sued his employer in New York claiming race and national origin discrimination after his employment was terminated during a reduction-in-force. He claimed that Japanese employees received preferential treatment over him and that he was fired because he wasn’t Japanese. The appeals court not only allowed his claim to proceed to trial but ruled that the employer’s Japanese parent company could be liable as well.
| Action Item: Draft offer letters and handbooks confirming that your employees are serving “at-will” while clearly respecting... |
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