Siegrist's [1996. Adverse health effects of high-effort/low-reward conditions. Journal of Occupational Health Psychology, 1, 27-41.] Effort-Reward Imbalance (ERI) Model assumes that ERI at one point in time influences health at a later point in time. Empirical cross-sectional and longitudinal findings have supported the influence of ERI on adverse health. However, the ERI model does not explicitly take into account that the relation between ERI and adverse health may be also explained by reversed causal relations, or even reciprocal (bi-directional) relations in which ERI and health mutually influence each other. The present 3-wave panel study among 211 Japanese male blue-collar workers in one construction machinery company examined reciprocal relations between ERI and adverse health (i.e., psychological distress and physical complaints) with a 1-year time-lag per wave. Hypotheses were tested using structural equation modeling (Amos 7.0J). Results showed cross-lagged and causally dominant effects of ERI on both psychological distress and physical complaints after 1 year for both Time 1-Time 2 and Time 2-Time 3. In addition, cross-lagged effects of psychological distress on ERI were found after 1 year for both Time 1-Time 2 and Time 2-Time 3. These findings suggest that (perceived) ERI and employee health influence each other reciprocally rather than uni-directionally, and underline the importance of studying reversed causal effects in the relation between ERI and employee health.