South Korea's Supreme Court has ordered Japanese companies to compensate individuals who say they or their relatives were forced to work for these firms during World War Two.

The court ruled in two lawsuits on Thursday that the former workers have the right to seek compensation for their work for Nippon Steel and Mitsubishi Heavy Industries during World War Two.

Four plaintiffs, including Korean women and a family member, sought compensation for their work at Mitsubishi's munitions factory in Nagoya, central Japan.

Another set of plaintiffs also did this for their work at plants of Nippon Steel's predecessor in Fukuoka and Iwate prefectures.

Lower courts have also ruled in their favor. The Japanese firms appealed the rulings.

Japan says any right to claims was settled completely and finally by the bilateral agreement in 1965 when Japan and South Korea normalized ties.

This is the first time in five years that South Korea's Supreme Court has handed down a ruling on wartime labor issues. The top court in 2018 ordered Nippon Steel and Mitsubishi Heavy Industries to compensate former Korean workers.

In March, the South Korean government announced a payment scheme in which a government-affiliated foundation pays damages in place of the Japanese firms.

Seoul said this would also apply to ongoing lawsuits when Japanese firms are ordered to pay compensation. For the plaintiffs that refused to accept the payments, the foundation took procedures to deposit the amount with the court, but the court has decided repeatedly not to accept the funds.

Japan's Chief Cabinet Secretary Hayashi Yoshimasa said in a news conference on Thursday that the ruling violates the 1965 agreement. He said the court's decisions are extremely regrettable and unacceptable that Japan has lodged a protest with South Korea.

Hayashi said the South Korean government has already announced the foundation will cover the amount and the interest on delayed payments if the plaintiffs win, and it plans to act in line with that.

As some plaintiffs choose not to accept payments from the foundation, the risk remains of the firms' assets being sold. Hayashi added that he understands that the South Korean government will continue to make the utmost effort to gain the understanding of the plaintiffs.

Mitsubishi Heavy Industries says the company regards any right to claims was settled completely and finally by the 1965 agreement. It said the rulings and procedures that run counter to the agreement are extremely regrettable.

Nippon Steel says it recognizes that the issue was settled by the 1965 agreement. The company said the latest ruling violates the agreement and is extremely regrettable.