Japan Employment Law Alert: Mandatory Measures Against Harassment by Customers and Against Sexual Harassment towards Jobseekers etc. — Companies Must Now Address Harassment Arising Outside of the Company

2. Definitions of Customer Harassment and Sexual Harassment towards Jobseekers etc.

(1) Customer harassment

Customer harassment means conduct that (i) is engaged in by a customer or other counterparty, (ii) exceeds the bounds of what is socially acceptable in light of the nature of the duties performed by the employees whom the company employs and other circumstances, and (iii) thereby harms the employees’ working environment.

“Customer or other counterparty” in clause (i) above includes the company’s contractual counterparties. Customer-harassment measures are therefore not irrelevant even to companies that operate on a purely B2B basis.

As to clause (ii) above, whether a demand made by a customer or other counterparty exceeds the bounds of what is socially acceptable is assessed holistically, by reference to both the “substance of the conduct” and the “means or manner” in which it is carried out. While the assessment will be straightforward in some cases, we expect that in many cases it will be difficult to draw the line between harassment and a legitimate demand. In this regard, the MHLW gives the following examples of conduct amounting to customer harassment:

(2) Sexual harassment towards jobseekers etc.

Sexual harassment towards jobseekers etc. means conduct of a sexual nature by an employee of the employer that obstructs the job-search activities of jobseekers etc. The definition of “sexual harassment” itself is substantially the same as for sexual harassment under the Internal Harassment rules. The class of protected persons is different, however: “jobseekers etc.” means persons who are not employees of the employer and who (i) apply for a position advertised by the employer, (ii) participate in the employer’s recruitment activities, or (iii) undertake practical training with the employer (e.g., an internship). The provision is aimed principally at sexual harassment occurring in job interviews, informational visits with alumni employees (so-called OB/OG visits), communications with company recruiters, and internships.

3. The Required Measures

(1) Overview

The measures that companies will be required to take under the Amendments are set out below (measures that have no counterpart in the Internal Harassment rules are underlined).

Of these measures, the following warrant particular attention when compared with the Internal Harassment rules.

(2) Customer harassment: Communicating the response procedures for customer harassment (item (b) above)

One customer-harassment measure that warrants attention is the requirement to establish, and communicate to employees, the procedures to be followed where an employee suffers customer harassment (or conduct suspected of being customer harassment).

The Internal Harassment rules are directed at preventing employees from committing harassment, and the required measures therefore focus on identifying clearly what constitutes harassment and prohibiting it. The customer-harassment measures, by contrast, are directed at preventing employees from suffering harassment and at ensuring an appropriate response where they do; this requirement is an expression of that objective.

The “response procedures” must be tailored to the actual circumstances of the company’s workforce, but the MHLW offers the following examples. Because these examples are directed primarily at B2C customer harassment, they will not necessarily translate to the B2B context; they are nevertheless a useful guide to the level of granularity required in order to satisfy the statutory obligation.

• Requiring the employee to report the matter immediately to a manager or supervisor and to seek instructions on how to handle the situation on the spot.
• To the extent possible, not requiring the employee to handle the matter alone, and, where necessary, having a manager or supervisor take over from the employee.
• Making an audio or video recording of the exchange with the customer.
• Where the employee has given a full explanation and the demands are nevertheless repeated, asking the customer to leave the premises, or terminating the call, after a set period of time.
• Reporting to the police any conduct that may constitute a criminal offense, such as assault, bodily injury, or threats.
• Where the matter cannot be resolved on site, escalating it to head office or a regional headquarters and seeking instructions.
• Where legal proceedings are required, coordinating with the legal department and consulting outside counsel.

No particular method of communication is prescribed. The MHLW’s examples include preparing and distributing a manual and holding training sessions and seminars.

(3) Customer harassment: Policy and framework for dealing with particularly egregious customer harassment (item (h) above)

Similar to the measure discussed in subsection (2) above, companies must also establish, and communicate to employees, a policy for dealing with customer harassment considered particularly egregious.

As to what is “particularly egregious,” the MHLW offers only one example — repeatedly making excessive demands of an employee — leaving the assessment far from straightforward. That said, while whether conduct amounts to customer harassment is, per the MHLW, assessed holistically by reference to the “substance of the conduct” and the “means or manner” in which it is carried out, as noted in Section 2(1) above, the categories of conduct listed in Section 2(1) are deemed to constitute customer harassment without any such holistic assessment. That list should therefore assist in determining whether particular conduct is “particularly egregious.”

As to the content of the “response policy,” the MHLW offers the following examples. These too are directed primarily at B2C customer harassment and will not necessarily translate to the B2B context, but they are a useful guide to the level of granularity required in order to satisfy the statutory obligation.

• Reporting to the police any conduct that may constitute a criminal offense, such as assault, bodily injury, or threats
• Refusing to sell goods or provide services to the person concerned
• Barring the person concerned from entering the company’s stores and facilities
• Applying for a provisional disposition order under the Civil Provisional Remedies Act (Act No. 91 of 1989)

As to the “putting in place” of a “system,” the MHLW’s example is to establish arrangements enabling the relevant departments — human resources, customer service, legal, and others — to coordinate appropriately and promptly, and to provide that, where particularly egregious customer harassment occurs, those departments will act together in determining the response to be taken.

(4) Sexual harassment towards jobseekers etc.: Clarifying in advance the rules applicable to job-search activities (item (iii) above)

Unlike the measures against sexual harassment within the company, the measures against sexual harassment towards jobseekers etc. require companies to formulate rules governing how employees interact with jobseekers etc. As examples of matters to be covered by such rules, the MHLW cites (i) specifying the times at which meetings may be held, (ii) specifying the locations, (iii) the arrangements for conducting meetings, and (iv) specifying which social media platforms may be used for communications. The MHLW does not, however, indicate how restrictive the rules need to be. Accordingly, as regards (i), (ii), and (iv), each company must decide for itself how far it is prepared to permit interactions outside of business hours, business premises, and official communication channels. As regards (iii), examples include restrictions on the number of people present at a meeting (so as to avoid one-on-one meetings) and requiring employees who conduct meetings to report the location, time, and format before or after the event.

(5) Sexual harassment towards jobseekers etc.: Communicating the job-search rules and the consultation contact point to jobseekers etc. (items (iii) and (iv) above)

Because both the likely perpetrator and the likely victim of Internal Harassment are inside the company, communication and awareness-raising need only extend to persons within the company. With sexual harassment towards jobseekers etc., however — a form of External Harassment — the likely victim is outside the company, and communication and awareness-raising must therefore extend to persons outside the company as well.

As examples of how this may be done, the MHLW cites “pamphlets, websites and the like,” although in practice the latter will generally be the realistic option — for instance, by posting the relevant information on the careers pages of the company’s website.

4. Risks of Inadequate Measures

Where the measures described above are inadequate, the MHLW minister may, depending on the degree of the inadequacy, impose administrative guidance in the form of advice (jogen), guidance (shidou), or a recommendation (kankoku), and, where a recommendation is not complied with, that fact may be made public. The same administrative guidance regime applies under the law to Internal Harassment, but to date no case has proceeded as far as public disclosure. It may therefore be inferred that employers subject to advice, guidance, or a recommendation in relation to Internal Harassment have complied and improved their harassment measures accordingly, and we expect that the same pattern may hold for External Harassment.

In addition, where an employee suffers harassment, the employee may bring a claim for damages against their employer on the basis that the measures described above were inadequate. Inadequate measures thus create the risk that the company will be unable to mount an adequate defense to such a claim.

Note, further, that in the case of customer harassment, if a company’s own employees engage in customer harassment against a supplier or other counterparty, this may constitute an abuse of superior bargaining position under the Antimonopoly Act⁴ , giving rise to a risk of enforcement action and public disclosure under that act.