Working Conditions in Japan

1. Minimum Working Conditions

Minimum working conditions such as minimum number of annual leave, rate of overtime, and holidays, are stipulated under the Labor Standards Act.

2. Salary

There is a Minimum Wage Act and the rate of minimum wage is renewed around October each year. There are two types of statutory minimum wage – one is for each prefecture and another is for certain industries, and the higher of the two needs to be met. The more commonly applied prefectural minimum wage is reviewed and announced around October each year, and the highest is for Tokyo at JPY907 per hour applicable from 1 October 2015 (from JPY888 applicable the previous year).

3. Maximum Working Week

As a general principle a standard workweek should not exceed 40 hours.

4. Overtime

While the guideline for monthly overtime is capped at 45 hours as a general principle, there is a mechanism to allow overtime beyond such a cap when there is a special agreement.

Other exceptions to this rule may apply depending on the status of the employee (e.g. exempt “managerial and supervisory” position employees) or the applicable work hour scheme (e.g. discretionary work hour system, flex-hour system).

Overtime work needs to be compensated with overtime allowance, which must be at least 125% of normal hourly wages for overtime up to 60 hours per month – for further overtime the rate needs to increase to 150%.

5. Holidays

The employer must provide at least 1 day off per week,.

Statutory annual leave must be provided when the employee’s attendance rate was 80% or above in the relevant period. For full time employees:

Year(s) of service Annual paid holidays granted
0.5 years 10 days
1.5 years 11 days
2.5 years 12 days
3.5 years 14 days
4.5 years 16 days
5.5 years 18 days
6.5 years or more 20 days

6. Employer’s Obligation to Provide a Healthy and Safe Workplace

An employer is obligated to provide “due care for safety” to protect the life and health of its workers in its workplace. This obligation has stemmed from the obligation of good faith and had been made into a statutory obligation when the Labor Contract Act was implemented. Initially this obligation had been discussed in the context of preventing workplace accidents such as in use of machineries, but is now more commonly discussed in the context of preventing long work hours, harassment (bullying) at the workplace, that leads to mental or physical sickness.

For more information, please contact L&E Global.
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