In July 2026, business owners operating a demolition company in Aichi Prefecture were arrested for knowingly employing three Vietnamese workers who had overstayed their visas. This case carries a critical message for all companies employing foreign nationals in Japan.

As specialists in visa applications and residency status procedures, we address business owners and HR managers who employ foreign residents in Japan. This article explains the legal risks highlighted by this incident and outlines the necessary measures your organization should take.

1. Case Overview and Background

The individuals arrested in this case were the owner and an employee of a demolition company in Aisai City, Aichi Prefecture. They are suspected of knowingly employing three Vietnamese nationals—despite knowing their residence periods had expired—at demolition sites in Aichi Prefecture between February and July 2026.

The case came to light following a tip received in March 2026: “There is a demolition company hiring overstaying foreigners.”

Such tip-based investigations have been increasing in recent years. Immigration authorities take citizen and industry reports seriously, and companies must recognize they operate under constant scrutiny.

2. What is the Crime of Facilitating Illegal Employment?

The charge in this case is “facilitating illegal employment,” stipulated in Article 73-2 of the Immigration Control and Refugee Recognition Act (Immigration Act).

Elements of the Crime of Facilitating Illegal Employment:

  • Causing illegal work activities
  • Placing individuals under one’s control for illegal work
  • Brokering illegal work as a business

Penalties:

  • Imprisonment of up to 3 years
  • Fine of up to 3 million yen
  • Or both

Critically, the defense “I didn’t know” does not hold. Failure to verify residence cards constitutes employer negligence.

3. Impact of Immigration Violations on Business Licenses

This case is particularly serious because it involves a licensed industry—demolition.

Companies in demolition and construction require various licenses, including:

Major Licenses:

  • Construction business license
  • Industrial waste collection and transport license
  • Demolition work registration
  • Secondhand dealer license (for used construction materials, etc.)

Currently, the Immigration Services Agency is urging ministries to designate immigration violations as disqualifying factors for various business licenses.

Consequences of Disqualification:

  • Inability to obtain new licenses
  • Revocation of existing licenses
  • Denial of renewal
  • Loss of public works bidding qualifications

In other words, a single immigration violation can make business continuation impossible.

4. Why is Regulation Being Strengthened Now?

While actively accepting foreign workers, the Japanese government has simultaneously intensified crackdowns on illegal employment.

Policy Background:

  • Promoting proper foreign employment
  • Eliminating malicious brokers and employers
  • Protecting foreign workers’ rights
  • Ensuring credibility of technical intern and specified skilled worker systems

The government has clearly adopted a policy of balancing “openness to foreign workers” with “strict law enforcement,” and enforcement is expected to intensify further.

5. Points Companies Must Verify Immediately

Companies employing foreign nationals should immediately verify the following:

5-1. Residence Card Verification

Items to Verify:

  • Residence card expiration date
  • Type of residence status
  • Presence of work restrictions
  • Permission for activities outside status of residence (where applicable)

Verification Timing:

  • At hiring (mandatory)
  • Before residence period renewal (recommend 3 months prior)
  • Regular internal checks (recommend biannually)

5-2. Understanding Work-Eligible Residence Statuses

Work-permissible activities vary by residence status.

Residence Statuses with No Work Restrictions:

  • Permanent Resident
  • Spouse or Child of Japanese National
  • Spouse or Child of Permanent Resident
  • Long-term Resident

Residence Statuses with Work Restrictions:

  • Engineer/Specialist in Humanities/International Services
  • Technical Intern Training
  • Specified Skilled Worker
  • Student (requires permission for activities outside status)

For example, under “Engineer/Specialist in Humanities/International Services” status, unskilled labor is prohibited. Assigning such individuals to demolition site work is illegal.

5-3. Employment and Separation Notifications

Employers hiring foreign nationals must notify Hello Work (Public Employment Security Office).

Notification Requirements:

  • At hiring: by the 10th of the following month
  • At separation: by the 10th of the following month

Failure to notify may result in fines up to 300,000 yen.

6. Building Internal Systems to Prevent Illegal Employment

6-1. Designate a Responsible Person

Clearly designate a manager for foreign employment administration responsible for:

  • Verifying and storing residence cards
  • Managing residence period expiration
  • Submitting notifications to Hello Work
  • Serving as liaison with government agencies

6-2. Prepare Manuals

Necessary Manuals:

  • Foreign hiring checklist
  • Residence card verification procedures
  • Residence period management sheet
  • Incident response flowchart

6-3. Conduct Internal Training

It’s essential to educate not only HR staff but also field supervisors on the basics of foreign employment.

Training Content:

  • Basic knowledge of residence statuses
  • Risks of facilitating illegal employment
  • How to read residence cards
  • Where to consult when in doubt

7. Utilizing Specialists

Laws governing foreign employment are complex and frequently revised. Handling everything in-house may be difficult.

When to Consult Specialists:

  • Hiring foreign nationals for the first time
  • Uncertainty about alignment between residence status and job duties
  • Employees approaching residence period expiration
  • Past risk of illegal employment
  • Support needed for residence status change or renewal

Administrative scriveners and other specialists provide not only residence status application support but also assistance in building corporate employment management systems.

8. Benefits of Properly Employing Foreign Talent

Proper foreign employment brings numerous benefits:

Benefits:

  • Alleviating labor shortages
  • Diverse workplace environment
  • Introducing global perspectives
  • Enhancing corporate image
  • License stability through legal compliance

Conversely, improper employment risks:

Risks:

  • Criminal penalties
  • License revocation
  • Damage to social credibility
  • Deteriorating business relationships
  • Loss of talented personnel

Legal compliance is the foundation of sustainable corporate growth.

9. Future Outlook – Strengthening Linkage Between Immigration Law and Licensing

The Immigration Services Agency has announced the following policies:

Policy Directions:

  • Promoting immigration violations as disqualifying factors
  • Strengthening verification of immigration law compliance at license renewal
  • Increasing penalties for malicious businesses
  • Preferential treatment for compliant businesses (fast-track processing, etc.)

In other words, polarization is advancing between “compliant companies” and “non-compliant companies.”

Legal compliance in foreign employment will increasingly determine corporate competitiveness.

10. Conclusion – Comprehensive Legal Compliance Protects Your Business

This case signals the arrival of an era where “I didn’t know” or “verification was lax” is no longer acceptable.

Actions Companies Should Take Immediately:
✅ Establish residence card verification systems
✅ Thoroughly manage residence period expirations
✅ Conduct internal training
✅ Partner with specialists
✅ Consult immediately rather than leaving uncertainties unresolved

Foreign workers are indispensable to the Japanese economy. Therefore, creating an environment where both foreign workers and companies can work with confidence through lawful employment is essential.

If you wish to continue your business, comprehensive legal compliance is imperative. Why not review your company’s foreign employment systems today?

Reference Article:
Yahoo! News: “Turkish demolition company owner and employee arrested for employing three Vietnamese nationals knowing they had overstayed”
https://news.yahoo.co.jp/articles/5709d83f8466096d12e605435084e1d7910abe12