Voluntary Retirement in Japan: Legal Rules & Steps
Oct 03, 2025UP!
Lawful Retirement Talks vs Forced Resignation
POINT: The key is pressure.
If talks remove free choice, it is unlawful.
Employees must always be able to say “NO.”
Case Law
The IBM Japan case set the rule.
Excessive pressure is illegal.
Insults or dignity loss are also banned.
Talks must support free decision-making.
If not, it may count as forced resignation.
Essential Rule
Ask one thing: Can the worker refuse?
If yes, it is safe.
If not, it risks being coercion.
[Note by Attorney Shinji Kakuta]
Do not run hours of meetings.
Do not repeat them many times.
Never push for a signature.
Meetings must stay calm and short.
Safe Process in Three Steps
POINT: Stay structured.
Steps: ① Prepare, ② Meet, ③ Record.
This keeps risk low and trust high.
① Prepare
Consensus: Show it is a company choice.
Reasons: Use facts, not vague claims.
Budget: Offer fair terms, often 3–6 months’ pay.
② Meet
Hold it in private.
Two company reps are enough.
Keep it 30–60 minutes.
Do not say “fired.”
Frame it as a proposal, not an order.
③ Record
Take notes.
Write a summary.
Avoid “he said, she said.”
Key Clauses in Agreement
POINT: The contract prevents disputes.
Must include Settlement and Non-Disparagement.
Non-compete needs extra pay.
Must-Have
Settlement: No further claims.
Non-Disparagement: No attacks, even online.
Confidentiality: No leaks of terms.
Amicable Exit: Confirms it is mutual, not firing.
Optional
Non-Compete: Only valid with payment.
FAQ
Q1: Can workers refuse?
Yes. Refusal is allowed.
Pushing after refusal is illegal.
Q2: Does refusal mean firing?
No. Refusal alone is not valid grounds.
Q3: Can they consult others?
Yes. Time for family or lawyer is required.
Q4: What exit status applies?
Usually “Company-Initiated.”
This gives faster, longer benefits.
Documents to Prepare
POINT: Bring evidence.
Clear records give clear advice.
- Performance & Attendance
- Warnings & Responses
- Contracts & Rules
- Incident Records
Conclusion
Retirement talks are useful but risky.
Respect the law at every step.
Consult a lawyer early.
You are welcome to contact us via the Contact Form to discuss and for more information.