20 Jul 2020

Japan’s work culture, typically known for its insistence on “face-to-face” working, has undergone rapid change during the COVID-19 pandemic, and we anticipate that even greater change is to come.

By Koichi Nakatani, Partner, and Peter R. Tyksinski, Foreign Attorney, Momo-o, Matsuo & Namba

Following the declaration of a national state of emergency on April 7 in Japan, industry groups have encouraged companies to consider teleworking (i.e. homeworking), staggered commuting, and flextime arrangements. The Ministry of Health, Labor and Welfare (MHLW) even issued a Telework Model Work Regulation for companies to follow.

But this shift in working styles has come with significant challenges. In a survey of 21,448 people conducted in March 2020, 71% said their companies had not yet addressed telework of those, 41% said their companies lacked the appropriate systems to allow for telework, and 17% said their companies did not have appropriate technology in place. Almost 40% said that their industry was not compatible with teleworking.

Small and medium-sized enterprises (SMEs) in particular are struggling, having limited resources for telework. This has prompted the government to offer subsidies to those SMEs that introduce teleworking. But companies are quickly learning to adapt. Reports from April show that 26% of SMEs never considered telework before have now implemented it. As an interesting side note, Japan is seeing a greater push for the use of digital signatures to replace the outdated and cumbersome paper-based hanko (seal) system.

Companies are considering how to repurpose the post-COVID workplace. In addition to issues on safety, other issues include how to offer fluidity between onsite and remote work; how to express the “culture” of a company beyond the physical office; and how to work collaboratively regardless of location. Clients now seem to want a workspace (both real and virtual) that is “future-proof”.

Corporations which are well-equipped for digital integration and internal data collection may be best-positioned in the long term. Employers will need to know, based on real-time data, what employees like and dislike about the workplace and where they physically like to work.

On the other hand, more traditional companies, such as those in the banking and public sectors, still face substantial technological barriers to remote working such as confidentiality and security issues. Certain IT projects for companies in these sectors were suspended during the stay-at-home period. In order to adapt to the post-COVID workplace, significant change is necessary.


While the future of Japan’s workplaces in the next six to twelve months is unclear, we can expect that more employers will be open to flexible working arrangements. Perhaps we will see the physical office becoming the headquarters for social engagement and as a means of building the “culture” and “brand” of the company, while the majority of employees will continue to work virtually.

One thing can be said with certainty: Japan is typically slow to change but when it does, it does so with enthusiasm.

© 2020 Momo-o, Matsuo & Namba

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