More Japanese Companies Increasing Compensation for Employee Inventions

Following the announcement that starting this month Toyota, the world’s largest car manufacture, will be significantly increasing the amount of compensation that employees receive for inventions, other Japanese companies have begun following suit and a movement for raising the compensation for employee inventions is gaining momentum in order to prevent the turnover of engineers and development staff.

Mitsubishi Electric, a major Japanese electronics and electrical equipment manufacturer, decided to double the employee invention compensation for patent applications and patent registrations to \100,000 from \50,000. Furthermore, Mitsubishi also plans on providing additional compensation for any inventions or products that receive awards or commendations from industry groups or the government, and they will abandon their cap on the amount of compensation received for inventions that are awarded commendations.
 
Other Japanese companies who have also decided to raise compensation for inventions include Ajinomoto and Kewpie, both major Japanese food manufacturers, Astellas Pharma, a major pharmaceutical company, and Hitachi Construction Machinery, a major construction equipment manufacturer.
 
Recently, several lawsuits have been filed domestically against Japanese companies by inventors who were dissatisfied with the compensation they received for their past inventions. In response to these lawsuits, Japanese legislation was enacted last April that provided that if reasonable compensation rules are implemented in advance by a company then the inventions made by the employee will belong to the company.