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Recently in the United States, in response to the emergence of “gig economy,” the debate whether gig workers are misclassified as independent contractors has been heated.  Japan’s practice with regard to the definition of employee could give meaningful insights to the U.S. practice.

In the U.S., the test to determine whether a person is an employee or an independent contractor depends upon how much control a principal has over a person’s activity.  In other words, a person whose jobs are subject to a principal’s discretion, such a person is not “independent” from a principal.

On the other hand, under the Labor Standards Act of Japan, an “employee” is defined as a person who is “employed at a business” and receives “wages” therefrom, regardless of the type of occupation.

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