Immigration bill proposes significant changes to attract foreign labor

IMPACT – HIGH

What is the immigration news? Japan’s legislature has passed an immigration bill that represents the most significant changes in decades as the country adapts its immigration system to an economy that is experiencing severe labor shortages. Among other changes, the law will introduce new types of residence status to attract foreign workers to fill labor shortages in designated industries, as well as impose new compliance measures.

Key changes:

Two-tiered visa system. A two-tiered visa system will be introduced for foreign workers demonstrating skills in industries designated by the government as suffering from labor shortages.

• Designated Skills Category 1. Foreign workers in certain designated industries who meet a particular level of knowledge and experience and pass an exam given by Japanese authorities will be eligible for one-year visas renewable up to five years, but will not be allowed to bring their family members. Changes of employer are allowed within the jobs designated under this category, which currently contains 14 industries, including aircraft handling, ship industry, electrical engineering, industrial manufacturing and others.
• Designated Skills Category 2. Foreign workers possessing professional skills in fields where labor shortages are deemed to be critical are eligible for visas under skills Category 2 if they have valid employment contracts, more advanced language skills and pass an exam given by authorities. Category 2 currently includes nine of the 14 Category 1 industries. The visas, which will be granted for one to three years, are renewable and allow workers to bring their family members and become eligible for permanent residency. Changes of employers are permitted within the jobs designated as Category 2.

Compliance

• The Minister of Justice has changed its guidance on renewals and changes of status applications. These requests may be refused if the employer has been negligent in the payment of social security obligations. Previously, applications for renewals or change of status were only denied in cases of “pernicious negligence” in failing to pay taxes or social security.
• Immigration authorities will have the right to conduct on-site company inspections. Visas may be suspended if the employer breaches any labor or immigration rules.
• Companies sponsoring foreign workers for either visa tier must form a plan to support the worker’s professional and social life in Japan. 

Analysis & Comments: The measures, which are expected to be introduced in April, will broaden the availability of visas and residency for certain foreign workers in the designated industries. The bill provides a framework for the scheme, and the government is expected to release further details within the next two months. Employers applying for renewals or changes of immigration status should ensure that they have paid all tax and social security payments. Employers should be aware that along with providing new routes for foreign workers, the law will focus on employer compliance in designing and implementing schemes to support foreign workers. The Cabinet will announce the basic scheme, but each government authority will issue details on implementation.

Source: Deloitte LLP. Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at 1 New Street Square, London EC4A 3HQ, United Kingdom.