Relativity of Keigo
A note of caution. One should note carefully that using polite forms (called keigo 'language of politeness, deferential language' in Japanese) does not begin with knowing who absolutely outranks whom. Neither is it a matter of knowing to which class or socioeconomic strata the speaker or the hearer belongs; politeness is pegged to how each of the participants in a linguistic situation (say, a meeting) sees/asserts his or her position in relation to others. In a typical social and work situation, when the speaker humbles himself and exalts the hearer, the hearer is likely to respond by humbling himself and promoting the speaker. As one can see humbling and exalting is reciprocally performed by the two parties, like riding a see-saw. In an example below two people talk about some business matter.
Katō-san, rei no mitsumori desu ga, ashita made ni itadakemasu↓ka?
Ms. Katō, that estimate, may we have↓ that by tomorrow?
Ee, osokunatte sumimasen. Ashita no asa motte mairimasu↓. Irasshaimasu↑ka?
Ah, sorry it's so delayed. I will bring↓ it over tomorrow. Will you be↑ there?
In this example, each of the speakers uses humbling form for his or her own action. In addition, Ms. Katō uses the verb irasshaimasu↑ to refer to the hearer's being there. These two people may differ in seniority, pay, rank in respective companies, but most of that is immaterial; each treats the other with keigo, in a reciprocal conversation that moves to elevate the other and humbling the self, much like riding a see-saw.
The foregoing example is simple, since only two people are involved. A reference to a third person makes everything a little more complicated. Suppose Sakuma at Company X visits Company Y. Sakuma asks a Japanese worker Ueno of Company Y if his CEO (Matsuda) is planning to go to a meeting.
Sakuma: Shachō irassyai masu ka?↑ "Is your CEO going↑ (to a meeting)?"
Ueno: Ee, mairimasu.↓ "Yes, she is↓."
Here irassyaimasu↑ is a deferential, elevating way of asking if Matsuda is going to some place. By using this verb, Sakuma is showing respect to Matsuda. Ueno, who is outranked by Matsuda, nonetheless responds using the humbling verb mairimasu↓ to describe Matsuda's action. Thus by saying this, Ueno is humbling his own CEO's action!
This illustrates two important principles at work in keigo. One is that who is humbled and who is exalted is relative to the situation; it is an error to assume that its use is a function of who absolutely outranks whom, a point made earlier. This underscores the importance of the first principle-relativism. (Before the 11th century, however, keigo was based on an absolute ranking in a given linguistic situation.)
Another point to be made is that, as illustrated in the second example above, keigo use is influenced greatly by how the participants in a situation (here Sakuma and Ueno, who made reference to a third person Matsuda) are related to each other from the speaker's point of view, particularly in relation to who is in-group and who is out-group (sometimes called the uchi-soto relationship).