In brief
The 2025 amendments to Japan’s Whistleblower Protection Act (“2025 Amendments”) will take effect on 1 December 2026. In connection with the implementation of the 2025 Amendments, on 31 March 2026, the Consumer Affairs Agency announced revisions to its guidelines (“Revised Guidelines”) on measures business operators should take related to their obligations (i) to establish whistleblowing systems and (ii) designate personnel to respond to whistleblowing reports (“Designated Handlers”).
This client alert summarizes the Revised Guidelines and outlines practical steps companies may want to consider taking before the 2025 Amendments enter into effect.
Summary of the Revised Guidelines
The Revised Guidelines are structured around the core policy objectives of the 2025 Amendments. These include (i) strengthening whistleblowing systems and improving their effectiveness, (ii) addressing factors that obstruct whistleblowing reports, (iii) enhancing deterrence of and remedies for retaliation against whistleblowers and (iv) expanding the scope of whistleblowers eligible for protection to include certain freelancers.
Establishing and improving whistleblowing systems
1. Clear explanation of confidentiality obligations and potential criminal penalties for Designated Handlers
The Revised Guidelines require that companies explicitly notify Designated Handlers that they are subject to confidentiality obligations regarding information that could identify a whistleblower and that criminal penalties may be imposed if they breach said obligations.
2. Specification of information employees should be informed of
The 2025 Amendments require employers to inform their employees about their whistleblowing systems. The Revised Guidelines specify that companies should inform their employees, etc. of the following:
- Existence of internal reporting channels, contact details and reporting methods
- Measures taken to ensure independence from the leader of the organization and other senior management
- How whistleblowing reports are handled
- Measures taken to exclude personnel with conflicts of interest from handling whistleblowing reports
- Measures taken to prevent detrimental treatment of whistleblowers
- Measures taken to prevent (i) sharing of whistleblowing reports beyond the extent necessary, (ii) obstructions to whistleblowing and (iii) attempts to identify whistleblowers
- Measures taken regarding notification of corrective actions, etc.
- Measures taken for record retention, review and improvement of whistleblowing systems and disclosure of operational performance of whistleblowing systems to employees, freelancers and officers, etc.
- Matters relating to cooperation with investigations into reported facts
Elimination of factors that discourage whistleblowing reports
The Revised Guidelines seek to clarify the scope and definition of conduct prohibited under the 2025 Amendments, including obstruction of whistleblowing and attempts to identify whistleblowers.
Preventing and remedying adverse treatment of whistleblowers
The Revised Guidelines clarify the definition of “adverse treatment” and provide a detailed list of examples, including the below.
1. The following actions relating to employment status are prohibited:
- Dismissal / forced resignation
- Coercing employees into accepting changes to their employment contracts that convert their employment status from regular to non-regular employment (e.g., from full time to part-time status)
- Non-renewal of fixed-term employment contracts
- Lowering an announced renewal cap
- Refusal of regular employment or re-employment
- Punitive dismissal or suspension
- Termination of worker dispatch agreements
- Termination of outsourcing contracts, etc.
2. The following actions relating to HR treatment are prohibited:
- Demotion
- Disadvantageous transfers, secondments, relocations or deployment on long business trips
- Negative performance evaluations affecting promotion
- Disadvantageously forcing an employee to remain on standby
- Disciplinary measures
- Refusal by a dispatch recipient to accept services
- Requesting replacement of a dispatched worker, etc.
3. Actions imposing economic disadvantages, including the following:
- Pay cuts
- Disadvantageous calculation of bonuses, one-time payments or retirement benefits
- Reduction or suspension of outsourcing transaction volumes
- Reduction of outsourcing fees
- Reduction of officer compensation, etc.
4. Actions that negatively impact mental or physical health, including de facto harassment, are prohibited.
Expansion of protection
The Revised Guidelines clarify the definition of “freelancers” newly included as protected whistleblowers under the 2025 Amendments and add related provisions.
Recommended responses
Companies are advised to consider the following measures in preparation for the entry into force of the 2025 Amendments and the Revised Guidelines.
Revising the Designated Handler appointment process
Ensure that appointment procedures include express notification that Designated Handlers are subject to confidentiality obligations and that criminal penalties may be imposed for breaches of said obligations.
Strengthening internal communication and training
Update policies, guidelines, training materials, hotlines and FAQs to include information that employees, etc. should be informed of, including channels and methods for submitting whistleblowing reports, measures taken to safeguard the independence of Designated Handlers, measures taken to prevent conflicts of interest, retaliation, obstruction of whistleblowing and attempts to identify whistleblowers, recordkeeping and measures taken to improve the whistleblowing system, etc.
Inclusion of anti-retaliation measures with concrete examples
Include the examples of detrimental treatment set out in the Revised Guidelines in HR and manager training and escalation protocols to ensure that decisionmakers do not take actions that could give rise to claims of retaliation in connection with terminations, transfers, evaluations, non-renewals and contractor dismissals.
Expanding access to whistleblowing systems and protection of freelancers
Determine whether current reporting channels and protection measures appropriately cover freelancers and consider whether contractual or onboarding documentation should be updated accordingly.
Monitoring, documentation and continuous improvement
Given that the Revised Guidelines emphasize record retention and reviews and disclosure of operational performance of whistleblowing systems, consider implementing a periodic review cycle and audit trail that demonstrates effectiveness and remediation.
Disclaimer (standard)
This client alert is provided for general informational purposes only and does not constitute legal advice.