When working in Japan, it’s essential to understand key aspects such as working hours, holidays, salaries, social insurance, and employee benefits. These conditions are shaped by Japanese laws and business culture, which can be quite different from other countries. Being aware of these differences beforehand can help you navigate the working environment smoothly.
Work Environment in Japan
Japan’s work environment is regulated by the Labor Standards Act, which sets out various rules to protect workers. This law covers the basics of working hours, holidays, and other working conditions, ensuring workers’ rights. However, it’s important to note that not all companies fully comply with these regulations.
In particular, small and medium-sized enterprises (SMEs) and startups often see more frequent overtime that exceeds legal limits, and they might not provide adequate social security. Additionally, some parts of the Labor Standards Act lack enforcement, which means workers aren’t always fully protected.
Still, with the recent push for work style reforms, more companies are starting to comply with these laws. As a result, excessive overtime and poor working conditions are slowly improving. There’s also a growing number of companies offering flexible work options like remote work and flextime, making the work environment more comfortable for employees.
Common Working Conditions in Japan
Working Hours
Standard Working Hours
The legal working hours in Japan are set at 8 hours a day and 40 hours a week by the Labor Standards Act and companies must adhere to this rule. For example, a typical office job might start around 8 or 9 AM, with a one-hour lunch break, and finish around 5 or 6 PM. In recent years, more companies have introduced flexible working hours or core time systems, offering employees greater flexibility in their schedules.
Overtime
Overtime work is quite common in Japan, and in some cases, it’s not paid—this is known as “service overtime.” Legally, all overtime should be compensated with an additional 25% of the base wage, and working more than 45 hours of overtime per month is prohibited, except under certain special conditions. Despite efforts to reduce working hours and promote work style reforms, many SMEs still struggle to comply with these regulations.
Holidays
Annual Holidays
Typically, companies offer Saturdays and Sundays off, along with 16 public holidays each year. Depending on the company, Saturdays might be workdays or alternated as off days. The average total number of holidays is around 120 days per year. Some companies also provide special leaves like refreshment breaks or summer vacations.
Paid Leave
By law, employees who have worked for more than six months are entitled to a minimum 10 days of paid leave. The number of days increases with years of service; for example, after three years, employees receive a minimum 15 days of paid leave. However, in Japan, the rate of paid leave usage tends to be low since some companies have specific rules that make it difficult for employees to take their paid leave.
Maternity and Childcare Leave
Maternity leave is available to women before and after childbirth. Pre-childbirth leave can be taken from six weeks before the due date, and post-childbirth leave is typically eight weeks. Additionally, childcare leave is available until the child turns one year old, with financial support provided by the government during this period.
Sick Leave
When unable to work due to illness or injury, employees can take sick leave, though it’s usually unpaid. However, if a doctor determines that the employee cannot work for a certain period, they may receive injury and sickness benefits from their health insurance.
Salary
Base Salary
Salaries in Japan are usually based on a base salary, determined by job responsibilities, experience, and skills. For new graduates or those with no experience, the base salary tends to be lower, but it typically increases with experience and skill development. According to a survey by the Ministry of Health, Labor, and Welfare, the average starting salary for a university graduate in 2022 was 228,500 yen.
Allowances
There are various allowances in addition to the base salary, such as commuting, family, housing, and position allowances. For example, commuting allowances help cover transportation costs, family allowances are for those with dependents, and housing allowances assist with rent. Position allowances are provided to those in managerial roles.
Bonuses
In Japan, it’s common to receive bonuses twice a year—usually in summer and winter. The amount varies depending on company performance, policies, and individual evaluations. Each bonus could be equivalent to two to three months’ worth of base salary, making it a significant part of an employee’s income. However, bonuses are not legally mandated, so they might not be provided if the company or individual performance is poor.
Social Insurance
All workers in Japan, including some part-time employees, must enroll in social insurance, which covers health insurance and employee pensions. The fees are deducted from their salaries and its cost varies by region and income.
Health Insurance
Health insurance covers part of medical expenses, reducing out-of-pocket costs for workers. Generally, health insurance covers 70% of medical costs, depending on the type of insurance, the insured’s age, and the treatment needed.
Employee Pension
The employee pension system provides benefits after retirement. Pension contributions are calculated based on salary and are paid during employment, with benefits being received after retirement. Since the employer matches the employee’s pension contributions, the retirement benefits are typically higher than those under the national pension system, which is available to freelancers.
Employment Insurance
Employment insurance provides financial support during periods of unemployment, including unemployment benefits and reemployment services, such as vocational training, to help workers quickly return to the workforce.
Workers’ Compensation Insurance
Workers’ compensation insurance provides benefits for work-related injuries or illnesses and commuting accidents. Employers are required to cover the full cost of this insurance, so employees do not bear any expense.
Employee Benefits
Employee benefits include various services that support workers’ lives, such as company cafeterias, health check-ups, company trips, and access to sports facilities. The specific benefits vary by company, but they play a crucial role in improving employee satisfaction and work-life balance.
Employment Types
Full-Time Employees (Sei-shain)
Full-time employees usually work 40 hours a week and have long-term employment contracts. They generally receive stable salaries, benefits, opportunities for promotion, bonuses, and special leave. If they wish to resign, they typically need to give one to two months’ notice.
Contract Employees (Keiyaku-shain)
Contract employees work based on a fixed-term contract. Since their employment ends when the contract expires, they may have less job security compared to full-time employees. Whether they receive bonuses, special leave, or benefits depends on the company. There’s a law that allows contract employees to renew their contracts as long as both the employer and the employee agree to it. However, if the employee has worked for the same employer for a total of five years, they have the right to request a switch to a permanent contract without a fixed term.
Part-Time Employees
Part-time employees can work flexible hours, such as short shifts or weekends. Even when working full-time hours, their pay is usually hourly. While part-time employees often don’t receive benefits, some industries provide commuting allowances or meal subsidies.
Other Employment Types
Other employment types include temporary and freelance workers. Temporary workers are employed through staffing agencies and work at client companies, with contract terms varying by agency and company. Freelance workers take on specific tasks under a contract, either project-based or hourly.
Working conditions in Japan, such as standard working hours, salaries, and employee benefits, possibly differ from those in other countries. However, by understanding these systems and cultural norms, you can enjoy a better working experience. To succeed in your job in Japan, it’s important to familiarise yourself with these basic working conditions and find a work style that suits you. Good luck with your job hunting!
