Salary Cuts
Sample Cases
CASE 01
Sudden salary cut and dismissal leads to labor tribunal
Case of Client T
Client T is a male in his 50s who was working in sales at a company selling houses.
One day, Client T was handed a piece of paper titled “Notification of Salary Revision” and discovered that his basic salary and allowances were being cut by a total of 50,000 yen.
At a later date, Client T was dismissed for actions that he had no recollection of, so he contacted us for advice.
3.5 million yen settlement obtained in unpaid salary after dismissal and overtime
We sent certified mail to the company and requested for the company to withdraw the dismissal, pay overtime, and pay the unpaid amount that was cut from his salary.
However, a representative of the company refused to pay, stating that the claim was unfounded.
This opposition led us to file for a labor tribunal.
At the second tribunal hearing, a settlement of 3.5 million yen (sum of the unpaid salary after dismissal plus overtime) was reached in favor of Client T.
Key Points
The reason for Client T's victory was that he had not agreed to the salary cut in writing.
In the labor tribunal, the company claimed that Client T had agreed to the cut.
However, Client T had clearly expressed his objection to the cut and had never signed an agreement.
Because salary is the most important element of a labor contract, when there is conflict regarding whether a salary cut has been agreed to, it is judged according to strict criteria.
Therefore, the signing of an agreement is practically essential for a legally recognized salary cut.
In Client T's case, an agreement was not signed, so the salary cut was found to have been invalid.
There are many cases like this where a salary cut is invalid, so if you are told that your salary will be cut, we recommend that you ask us or the Labor Standards Inspection Office for advice.