‘Chilling effect’: Japan’s whistle-blowers weigh high price of speaking out

Yutaka Kato* knew there would be risks when he reported suspected misconduct by his employer to Japanese authorities.

What he did not expect, he said, was a 47.88 million yen (US$300,000) damages claim from that employer – the Japanese subsidiary of US-listed medical device manufacturer STAAR Surgical – along with the prospect of years in court and the uncertainty of whether he would ever return to work.

Kato is among a growing number of whistle-blowers in Japan who say laws meant to protect them from retaliation have not stopped companies from pursuing damages claims, dismissals and other actions that can leave them financially drained, professionally isolated and afraid to speak out.

His former employer’s claim was dismissed by the Tokyo District Court in December last year but was appealed to the high court, with a ruling set to be handed down on September 3.

Kato has challenged his dismissal in a separate lawsuit, with the high court ruling in his favour, although the company has appealed to Japan’s Supreme Court.