Japan
Make employment in Japan easy. Let us handle payroll, benefits, taxes, compliance, and even stock options for your team in , all in one easy-to-use platform.
- Capital city
Tokyo
- Currency
Japanese yen (¥, JPY)
- Languages
Japanese
- Population size
125,620,000
Facts & Stats
- Capital city
Tokyo
- Currency
Japanese yen (¥, JPY)
- Languages
Japanese
- Population size
125,620,000
- Ease of doing business
Very easy
- Cost of living index
87.77 (2021)
- Payroll frequency
Monthly
- VAT - standard rate
5%
- GDP - real growth rate
0.7% (2019)
Japan has enjoyed a long, rich history spanning around 2,000 years, and has given rise to a wonderful cultural heritage featuring samurai, ninjas, calligraphy, origami, sushi, ramen, and of course, anime!
Armed with a $5.5 trillion GDP, Japan is the world’s third-largest economy, built on powerful technology, automotive, tourism, and telecoms industries. And with unusually low unemployment figures, a welcoming population, and growing cultural diversity, Japan has maintained a solid place on the top of the world’s most desirable places to do business.
Grow your team in Japan with Remote
Looking to hire employees in Japan? Companies hiring in Japan must either own a local legal entity or work with a global employment platform like Remote that can legally provide employment services in the country. Remote can employ team members in Japan and keep you compliant at all times.
Remote can hire, onboard, and pay your Japan team so you don't have to set up local HR services in the region. Remote also makes it easy to pay contractors in Japan. Sign up now to get started or talk to an expert for more details.
Risks of misclassification
Japan, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in Japan may lead to fines and penalties for the offending company.
Employing in Japan
Japanese labor laws are outlined across two regulations, namely:
The Japanese Civil Code, and
The Labor Standards Act of 1947
Both of these define provisions for employee protections and workers’ rights which apply to Japan’s workforce of 68.7 million.
Employees in Japan enjoy protections against discrimination based on age, religion, sexual orientation, gender expression, and race.
Common questions that could come up during the hiring process include the minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Japan.
Minimum Wage
In Japan, minimum wage rates are set regionally in line with local costs of living and range from ¥714 ($6.46) to ¥932 ($8.43) per hour. Japan’s hourly minimum wage depends on the region. The highest being 985 Yen in Tokyo and the lowest being 761 Yen in Kagoshima.
Payroll Cycle
For customers of Remote, all employee payments will be made in equal monthly installments on or before the last working day of each calendar month, payable in arrears.
Onboarding Time
We can help you get a new employee started in Japan fast. The minimum onboarding time we need is only 19 working days.
Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.
For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.
Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.
14 Public holidays
Competitive benefits package in Japan
At Remote, we’re passionate about helping you craft the best possible employee experience for your team. We are leading the way in developing globally competitive benefits programs. This means making sure employees everywhere have access to both the required and supplemental benefits they need to thrive, and your company has the localized expertise to needed attract and keep the best global talent.
Our benefits packages in Japan are tailored to fulfill the local needs of employees. Typically, our packages contain some or all of the following benefits:
Health Insurance
Dental Insurance
Vision Insurance
Mental Health Support
Pension or 401(K)
Life and Disability Insurance
Taxes in Japan
Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Japan.
9.15%
Pension contribution
4.935%
Health Insurance Contribution (or 5.83% if 40 years or older)
0.6%
Unemployment insurance
0.25% - 8.8%
Work injury
~0.36% - Family allowance
Types of Leave
Employees earn paid vacation days based on their tenure, starting after they’ve spent six months working with an employer, and can accrue up to two years of paid vacation.
6 months: 10 days paid vacation
1.5 years: 11 days paid vacation
2.5 years: 12 days paid vacation
3.5 years: 14 days paid vacation
4.5 years: 16 days paid vacation
5.5 years: 18 days paid vacation
6.5 years: 20 days paid vacation
Over 6.5 years: 20 days paid vacation
Employment termination
Termination process
In Japan, terminating employee contracts can be demanding, and employees can dispute and only accept to be let go with a severance package equivalent to a month’s pay for every year worked.
Notice period
Employers are required to provide 30 days advance notice or compensate the employee in lieu of the mandatory notice period.
Severance pay
There are no requirements for employers to offer severance packages under Japanese labor laws.
Probation periods
Probation periods last anywhere from 1 - 12 months.