Supreme Court Invalidates Individual Agreement "Not to Withdraw from a Union" Under a Union Shop Agreement

According to Kyodo News, in the third case of appeal in which an employee of Toshiba Corp. affiliated with a trade union outside the company demanded that both the Toshiba Union, which concluded a union shop agreement, and the company should accept his withdrawal from the Toshiba Union, the Supreme Court on February 2 overturned the ruling of the Tokyo High Court against the employee and approved his withdrawal. The Supreme Court also ordered the company to halt dues checkoff, and the union to refund approximately 250,000 yen of union dues already paid.

According to the latest ruling, the plaintiff, a member of the Toshiba Union who joined another trade union outside the company simultaneously in September 1995, called on the Toshiba Union to accept his withdrawal, and in May 1996, agreed with the company that he would belong to both trade unions.

However, when dissatisfied with his relocation, the employee asked the Toshiba Union for assistance, but was told that there was no problem with the relocation. He thus notified the union and the company of his intention to withdraw from the union. In May 2001, when they refused to accept his withdrawal, he decided to bring the case to court.

Although the ruling by a district court in July 2003 denied the validity of the individual agreement itself and acknowledged the claim of the plaintiff, a second ruling (in July 2004) accepted the validity of the agreement and judged that it is "obligatory for Toshiba employees to belong to the Toshiba Union." In the latest and third ruling, the presiding judge invalidated the individual agreement, explaining that it offends public order and morals to deprive employees of an important right, the freedom to withdraw from unions, and to force permanent obedience upon them.

In Japan, company based unions are the prevailing form of trade union, thus companies scarcely ever adopt the status of closed shops and traditionally rely on union shop agreements. Under a union shop agreement, employees, in general, except for those who have supervisory positions involving personnel affairs, must become members of the union under the agreement and, in many cases, union dues are deducted from their salaries. Even so, in practice, open shops do not necessarily require employees to be union members as a condition of employment, and so-called "incomplete unions" do not require employers to dismiss employees who have withdrawn from the union, leaving the decision of whether or not to dismiss the employees to the discretion of employers.

Where the effectiveness of union shop agreements is concerned, there is a precedent in which the Supreme Court ruled that employers cannot dismiss an employee if he or she has withdrawn from a union in the union shop agreement and joined another trade union or formed a new union. The latest case has established a new precedent which will have considerable impact on the effectiveness of union shop agreements themselves in the future.

US$=118yen （March 1, 2007)