Hiring your first employee in Japan raises immediate questions about legal obligations, costs, and timelines. These 12 questions cover the issues that new employers encounter most frequently.
Within 5 days of the employee's hire date. Social insurance includes health insurance (健康保険) and employees' pension insurance (厚生年金保険). Enrollment is mandatory for companies with even one employee, with limited exceptions.
Social insurance premiums are shared approximately 50/50 between employer and employee. The total rate varies by prefecture and the employee's salary grade but is approximately 30% of gross salary, with the employer paying roughly half. This is a significant labor cost that should be factored into hiring budgets.
Employment insurance (雇用保険) covers unemployment benefits. Enrollment is required for employees working 20 or more hours per week who are expected to be employed for 31 or more days. The employer bears approximately two-thirds of the premium.
Article 15 of the Labor Standards Act requires employers to clearly specify certain working conditions in writing. While a formal contract signed by both parties is best practice, the legal minimum is a written statement of conditions delivered to the employee.
Minimum wage (最低賃金) is set by prefecture. Rates are revised annually, typically in October. The national average exceeds ¥1,000 per hour, with Tokyo and other metropolitan areas higher. Employers must pay at least the minimum wage for the prefecture where the work is performed.
Overtime requires a written agreement between the employer and employees (36協定) filed with the Labor Standards Inspection Office. Overtime hours are capped — generally 45 hours per month and 360 hours per year for normal provisions. Premium pay of at least 25% above regular hourly rate is mandatory.
No. Japan's employment law strongly protects employee tenure. Under the Labor Contracts Act (労働契約法) Article 16, dismissal is invalid if it lacks objectively reasonable grounds and is not considered appropriate by general social norms. Additionally, 30 days' advance notice (or 30 days' pay in lieu) is required under Article 20 of the Labor Standards Act.
After 6 months of continuous employment with 80%+ attendance, employees are entitled to 10 days of paid annual leave. This increases annually up to 20 days after 6.5 years of service. Employers must ensure employees take at least 5 days per year.
The Part-Time Employment Act (パートタイム労働法) and the Labor Standards Act apply to part-time workers. Social insurance enrollment depends on working hour thresholds. Part-time workers must not be treated less favorably than comparable full-time employees without reasonable justification.
A 36協定 (saburoku kyōtei) is a written agreement between the employer and a majority representative of employees that permits overtime and holiday work within specified limits. You need one if any employee will work beyond 8 hours/day or 40 hours/week. Filing it with the Labor Standards Inspection Office is mandatory before the overtime occurs.
The Labor Standards Act requires employers to maintain records of working hours, wages paid, and employment conditions for each employee. These records must be kept for a minimum of five years (three years under the previous requirement, extended by the 2020 amendment with a transitional measure).
The major threshold is employment regulations (就業規則): mandatory for employers with 10+ employees, optional below that. However, all other Labor Standards Act provisions — working hours, overtime, paid leave, employment contracts — apply regardless of company size.
MmowW's Employment Rule Checker takes your specific situation — company size, employee count, working hours — and generates the applicable obligations. Instead of reading 12 FAQ answers and determining which apply to you, the checker does the matching automatically.
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Try it free →Q: Where can I find the current minimum wage for my prefecture?
A: The Ministry of Health, Labour and Welfare publishes current minimum wage rates by prefecture on its website. Rates are updated annually. MmowW's tool references current rates.
Q: Do these rules apply to interns?
A: If an intern performs work that benefits the employer and the relationship has characteristics of employment, the Labor Standards Act may apply. Unpaid internships that provide genuine training without productive labor for the employer may fall outside employment law, but the classification is fact-dependent.
Q: What if I cannot afford social insurance premiums?
A: Social insurance enrollment is mandatory and not optional based on financial capacity. The premiums are a required cost of employing workers in Japan. Budget for approximately 15% of each employee's gross salary as the employer's share.
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