Sumo wrestling is Japan’s national sport, and professional sumo wrestlers are highly respected athletes.
Payroll and Benefits Guide - Japan
Fun Facts
The world’s oldest wooden building, Horyu-ji Temple in Nara.
Sushi, one of Japan’s most famous dishes, is not always made with raw fish.
Japan has more than 6,800 islands, and only about 430 of them are inhabited.
The Koi fish, often associated with Japan, symbolizes strength, determination, and perseverance in Japanese culture.
Japan is famous for its high-tech toilets.
Contributions
Employee Payroll Tax
| Contribution Type | Rate |
| Pension | 9.15% |
| Health Insurance | 4.92% |
| Unemployment Insurance | 0.60% |
Employer Payroll Tax
| Contribution Type | Rate |
| Pension | 9.15% |
| Health Insurance | 5% – 6.57% |
| Nursing Care Insurance | 0.91% |
| Unemployment Insurance | 0.95% |
| Work Injury | 0.25% –8.8% |
| Family Allowance | 0.36% |
Payroll
Payroll Cycle
The payroll cycles is monthly.
13th Salary
In Japan, it is a traditional practice to provide a summer bonus paid in June and a winter bonus paid in December, often referred to as the “13th month” or even “14th month” salary.
Work Hours and Week
The standard working hours in Japan are 8 hours per day, 40 hours per week.
Overtime
Any work performed beyond the standard weekly working hours in Japan is considered overtime and is subject to regulation through employment contracts or collective agreements.
Leave
Paid Time Off
In Japan, the entitlement to paid leave is determined in the employment contract and is typically dependent upon the number of years of employment.
Public Holidays
They are 16 public holidays in Japan.
Sick Days
In Japan, there is no mandatory requirement for sick leave.
Maternity Leave
All female employees are entitled to maternity benefits, which typically consist of 14 weeks of paid leave. This leave is divided into six weeks before the due date and eight weeks after the delivery.
The maternity payment is provided by the Social Insurance and is based on the National Health Insurance rates. As of the time of my last update in September 2021, the rate was 420,000 JPY per child.Iif the employee is enrolled in the employees’ health insurance, they may receive a maternity allowance of two-thirds of their regular salary rate. This maternity allowance is applicable from 42 days before the expected date of birth until 56 days after the delivery.
Paternity Leave
The father is entitled to paid paternity leave for up to one year after the birth as childcare leave.
Parental Leave
Childcare leave can be taken by either the mother or the father, allowing both parents to have the opportunity to care for their child. Childcare leave starts from the day after the maternity leave ends and is covered by the labor insurance system.
Termination
Termination Process
The termination process varies according to the employment agreement and collective agreement in place. It is based on the type of contract,
Notice Period
In Japan, the standard notice period is typically 30 days.
Severance Pay
There are no statutory requirements for severance payments.
Probation Period
Probation Period
The probation period in Japan for permanent employees is generally between 3 and 6 months.
Immigration
Before arriving in Japan, foreign individuals typically need to obtain a work visa from a local Japanese embassy or consulate. There are different types of residence visas, each permitting the holder to work only in a specific industry or profession.
To qualify for a working visa, applicants usually need to possess a university degree or have extensive professional experience in their specialized field. In most cases, an employer in Japan needs to sponsor the applicant for the work visa.
For Work Permits
Japan does not have a specific “work permit” system like some other countries. Instead, the process of working legally in Japan involves obtaining a work visa or a relevant residence status that permits the individual to engage in employment within the country.
VAT
The standard rate of VAT in Japan is 10.00%.