Known as the “Land of the Rising Sun”, Japan’s distinction from the rest of the world is not only their strategic geographical location but also due to their 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.
More information about average salaries in Japan can be found on Salary Explorer.
English Proficiency: Low Proficiency
Number of LinkedIn Users (2021): 2,862,000
More information about job portals in Japan can be found here.
More information about recruitment agencies in Japan can be found here.
*Rates differ across prefecture, contact us for more information. The general employer payroll tax can be found here.
*Rates differ across prefecture, contact us for more information. The general employee payroll tax can be found here.
Japan follows a progressive income tax model. The source for the employee income tax can be found here
On average across prefectures, ¥902 per hour.
Paid monthly, typically by the 25th of each month.
Typically twice per year, often in the summer and winter. The amount varies, but negotiations between employer and employee determine the amounts and conditions.
In principle, must not exceed 40 hours per week or 8 hours per day excluding breaks. Some businesses are permitted to have their employees work up to 44 hours per week.
16 public holidays can be found here.
Although it is not mandatory to pay for public holidays, it is common to count these days as paid days off.
If a national holiday falls on a Sunday, the next working day is counted as a public holiday.
Employees may accumulate up to 2 years of unused paid leave.
No mandatory sick leave. Paid annual leave is used to take leave of absence.
14 weeks maternity leave, divided into 6 weeks before birth and 8 weeks after birth.
Woman receives 2/3 of their base salary (covered by social insurance)
Male employees would be able to take four weeks of leave within eight weeks from the birth of their child.
Can be taken after the maternity leave ends up till the day before the child turns 1 year old. If both parents take child care leave, the leave is extended to when the child is 1 year and 2 months old. The cost is covered by the labor insurance.
Unpaid leave to care for direct family members for up to 93 days per family member. However, this does not include employees under fixed-term employment arrangements or within 6months and 93 days of the start of the family care leave.
If the employee is in charge of arranging the funeral service, up to two 2 days of additional leave is added.
Termination of regular employees is tricky and may risk having the employee’s contract reinstated by the courts.
3 available employee termination methods:
30 days’ notice before termination or payment of wages in lieu of notice.
Severance pay is not mandatory, unless specified in employment contract.
Not mandatory. Common practice is 3 to 6 months.
Japan has two systems that deal with social security for their employees, both of which are governed and mandated by their government: the social insurance scheme and the labour insurance scheme. The former covers the pension and health benefits and pension for employees while the latter covers accident compensation and unemployment insurance. Below is a summary for the insurances that Japan offers to their workers:
Japanese companies whose shares are listed in the country’s stock exchange may offer share option plans to their employees. Most companies follow the ESOP guidelines set by the Japan Securities Dealers Association (JSDA). To learn more about this employee benefit, you may click through this link.
The general consumption tax in Japan is 10%, with the exemption of food which is 8%.