Unpaid Freelance Fees in Japan: What to Do When a Japanese Client Does Not Pay

You completed the work. You sent the invoice. The payment date passed.

The Japanese client now says that payment is delayed, the work was unsatisfactory, or internal approval is still pending.

What can you do?

For foreign freelancers and consultants, unpaid compensation disputes in Japan are usually decided by examining three things:

1. what the parties agreed
2. whether the agreed work was performed
3. what evidence exists

Can I claim payment without a signed contract?

Possibly.

A contract under Japanese law does not necessarily need to be contained in one formally signed document.

Evidence may include:

• emails
• Slack or other chat messages
• quotations
• purchase orders
• invoices
• statements of work
• previous payments
• communications confirming delivery or acceptance

For example, an email stating "Please proceed for JPY 800,000" followed by evidence that the requested work was completed may be highly relevant even if no formal agreement was signed.

What if the client says my work was defective?

A client cannot necessarily avoid all payment simply by saying that it is unhappy with the work.

The key questions may include:

• What deliverables were agreed?
• Were objective specifications established?
• Was the work delivered?
• Did the client accept or use the deliverables?
• Did the client previously approve milestones?
• What defects are actually alleged?
• Was there an opportunity to correct them?

Disputes involving software development, consulting and creative work often turn on the difference between an objective contractual requirement and a client's later subjective dissatisfaction.

Does Japan have special rules protecting freelancers?

Yes.

Japan's Freelancer Act came into force on November 1, 2024.

Depending on the parties and the transaction, businesses commissioning work from freelancers may be required to clearly state transaction terms and to set and comply with payment deadlines.

In covered transactions, payment generally must be scheduled within 60 days from receipt of the freelancer's work or services, subject to specific rules and exceptions.

The Act may also prohibit certain practices such as unjustified reductions in compensation.

Whether the Act applies requires examination of the specific relationship. The notice rules that apply when such an engagement is brought to an end are covered in contract termination in Japan.

What if I am called a freelancer but actually work like an employee?

This distinction can be extremely important.

The title written on the contract does not necessarily determine the legal relationship.

If the person works under substantial direction and control and the relationship has characteristics of employment, Japanese labor law may become relevant. The framework Japanese practice uses for that question is set out in when a contractor is treated as an employee.

Wage claims and ordinary contractual claims can be subject to different legal rules, including different limitation periods.

Therefore, a dispute should not automatically be treated as a freelance invoice case merely because the document says "independent contractor."

What steps can I take?

Step 1 - Preserve the evidence

Download contracts, messages, invoices and work product before access to company systems is terminated.

Step 2 - Confirm the amount and legal basis

Separate undisputed invoices from disputed additional work, expenses or damages.

Step 3 - Make a written demand

Set out the relevant agreement, completed work, unpaid amount and payment deadline.

Step 4 - Lawyer negotiation

For a material claim, communication through counsel can help focus the dispute on the contractual and evidentiary issues.

Step 5 - Court proceedings if necessary

Depending on the amount and circumstances, various Japanese civil procedures may be available.

Do not wait indefinitely

Japanese claims are subject to limitation periods.

The precise period depends on the nature of the claim, so repeated promises such as "we will pay next month" should not be treated as a reason to leave the matter unresolved indefinitely.

When to consult a lawyer

Consider obtaining advice if:

• multiple invoices remain unpaid
• the company has stopped responding
• the client suddenly alleges defects after months of silence
• the company appears to be in financial difficulty
• a large portion of your annual income is involved
• the contract contains Japanese governing-law or jurisdiction provisions that you do not understand

The earlier the documents are organized, the easier it usually is to assess the claim.