Known as the “Land of the Rising Sun”, Japan’s distinction from the rest of the world is not only its strategic geographical location but also due to its rich cultural virtues. Japanese people are known to be polite, organized, and have a good work ethic. In turn, the country has many merits to its name and is considered one of the most developed countries in the world.
Japan’s economy is ranked as the third-largest in the world by nominal GDP and fourth by Purchasing Power Parity (PPP) GDP. The country is also one of the world’s leading investors, having more than $220 billion in FDI (foreign direct investments) outflows each year.
Tokyo, Osaka, and Kyoto
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The top universities in Japan are:
Local: 1
World: 78
Local: 2
World: 125
Local: 3
World: 201
Local: 4
World: 303
Local: 5
World: 323
Below listed are the average salaries for some common jobs in Japan.
Job Title | Average Monthly Salary (in JPY) | Average Monthly Salary (in USD) |
Financial Manager | 1,050,000 | 8008.24 |
General Manager | 931,000 | 7100.64 |
Business Development Manager | 834,000 | 6360.83 |
Financial Analyst | 708,000 | 5399.84 |
Business Analyst | 642,000 | 4896.46 |
Project Manager | 619,000 | 4721.05 |
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3,372, 000
Onboarding Japanese employees can be a real asset to businesses expanding their operations in the country. The first step to realizing this is to be familiarized with the Japanese labor regulations. The following section shall guide you through the onboarding process.
There is no required language in Japanese employment contracts, provided it is written in a medium that all parties understand. However, most employers use the Japanese language for these documents.
Employees in Japan can have 3 to 6 months of probation period.
Date | Name | Type |
January 1 | New Year | National Holidays |
January 2nd | Holiday | National Holidays |
January 9 | Coming-of-age day | National Holidays |
February 11th | Foundation Day | National Holidays |
February 23rd | Emperor birthday | National Holidays |
March 21st | Vernal Equinox Day | National Holidays |
April 29th | Showa Day | National Holidays |
May 3rd | Constitution day | National Holidays |
May 4th | Greenery day | National Holidays |
May 5th | Children’s day | National Holidays |
July 17th | Marine day | National Holidays |
August 11th | Mountain day | National Holidays |
September 18th | Respect for the Aged Day | National Holidays |
September 23rd | Autumnal equinox | National Holidays |
October 9 | Sports day | National Holidays |
November 3rd | Culture Day | National Holidays |
November 23rd | Labor Thanksgiving Day | National Holidays |
Type of Leave | Time Period | Mandatory |
Annual Leave | 10-20 days | Yes |
Sick Leave | 0 days | No |
Maternity Leave | 14 weeks | Yes |
Employees in Japan are paid monthly.
Minimum wage in Japan varies with location, ranging from 790 JPY to 1,072 JPY.
The standard working hours in Japan are 8 hours per day and 40 hours per week. Overtime is legal in the country, with a cap of 45 hours per month and 360 hours per year. The overtime pay varies as per the table below:
13th month pay is customary in Japan. Most employers offer these incentives for their employees as a winter bonus, usually around December.
Japanese employees are entitled to numerous benefits during their employment. Below are some of them:
Category | Tax Rate |
Health Insurance | 4.935% |
Welfare Pension | 9.15% |
Employment Insurance | 0.6% |
Child Allowance | 0.36% |
Worker’s Accident Compensation Insurance | Varies on the type of business |
Category | Tax Rate |
Health Insurance* | 4.905% |
Welfare Pension | 9.15% |
Unemployment Insurance | 0.5% (Upto March 2023) |
Child Allowance | 0.36% |
*Note: There is an additional fixed rate of 0.82% for the long term health insurance that is applicable for ages of 40 and 64.
Taxable Income (JPY) | Tax Rate | Deduction (JPY) | Tax on base amount (JPY) |
0 – 1,950,000 | 5% | 0 | 0 |
1,950,000 – 3,300,000 | 10% | 97,500 | 97,500 |
3,300,000 – 6,950,000 | 20% | 427,500 | 232,500 |
6,950,000 – 9,000,000 | 23% | 636,000 | 962,500 |
9,000,000 – 18,000,000 | 33% | 1,536,000 | 1,434,000 |
18,000,000 – 40,000,000 | 40% | 2,796,000 | 4,404,000 |
40,000,000 and above | 45% | 4,796,000 | 13,204,000 |
The standard VAT rate in Japan is 10%. However, few goods and services are levied a VAT of 8%.
Employers terminating their employees must provide a notice of termination informing them of the reasons for the decision. In cases of summary dismissal, an employer may do so without any notice but must pay their employees 30-days worth of wages, known as a “notice allowance.”
A notice period of up to 30 days is generally observed in Japan.
A severance pay is not mandatory in Japan.
According to the Japan Immigration Authority, foreign workers can legally work in the country if they have secured a Japanese work visa. Below are the types of visas in Japan:
Time and date of extra work | Rate |
Overtime | Additional 25% |
Night-time (22:00 – 05:00) | Additional 25% |
Weekends and Holidays | Additional 35% |
Night-time (continuing from overtime) | Additional 50% |
Holiday (continuing from night-time) | Additional 60% |