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Internal transfer of whistleblower: ruling highlights invalid practices - International Law Office

International Law Office

Employment & Benefits - Japan

Internal transfer of whistleblower: ruling highlights invalid practices

October 12 2011

On August 31 2011 the Tokyo High Court rendered a highly significant judgment in the Olympus case, which concerned a company's internal transfer of an employee.

An employee blew the whistle internally on the employer's possible solicitation of a worker from a client. After the whistleblowing incident, the company transferred the employee internally from one section to another.

On January 15 2010 the Tokyo District Court ruled that the internal transfer by the company was valid. However, the Tokyo High Court overruled this decision and held that the internal transfer was null and void. In essence, the Tokyo High Court ruled that:

  • due to the internal transfer, the employee suffered a great disadvantage that ordinary employees would not suffer;
  • the company had a malicious and retaliatory motive against the employee; and
  • the company's selection of the employee in question was highly unreasonable.

Moreover, it was found that:

  • the company had bullied the employee after the latter had unwillingly accepted the internal transfer, as it had set exceptionally high performance standards for the role, which were impossible for the employee to attain; and
  • the company had used defamatory language against the employee in the employee's education, training and guidance.

For further information on this topic please contact Hideki Thurgood Kano at Anderson Mori & Tomotsune by telephone (+81 3 6888 1000), fax (+81 3 6888 3050) or email (htk@amt-law.com).

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