Easily hire employees in Japan
ATA PEO Services simplifies the process of hiring employees in Japan for your business, alleviating concerns related to navigating local regulations, intricate tax structures, and overseeing global payroll. With ATA’s comprehensive support, your international hiring needs are expertly managed.
You can hire employees in Japan without the need for an entity.
Typically, to hire employees in Japan, your business must have an entity, which involves establishing a local office, registering an address as a subsidiary, and opening an account with a local bank. Managing regional benefits, payroll, tax, and HR laws throughout this process can take several months.
Japan has separate regulations for contractors compared to full-time employees, making it crucial to avoid misclassification to avoid potential penalties. ATA streamlines the process of hiring employees in Japan, ensuring speed, simplicity, and compliance. Additionally, our platform automates tasks such as tax document collection, payroll, benefits, and more.
Our quickstart guide to hiring in Japan
Navigate the tabs below to learn everything you need to know about hiring an employee in Japan
- Minimum Wage Requirements
- The present national weighted average for minimum wage stands at 931 yen, but starting from April 1st, 2023, the new fiscal year will see an increase to 961 yen (equivalent to 7.30 US dollars) on average. This rise in the minimum wage is occurring amidst increased inflation and as a result of Prime Minister Kishida’s pledge to improve wages.
- Individual Income Tax
- The range of individual income tax varies from 5% to 45% and is calculated using progressive rates. The total tax rates can be influenced by additional factors such as household status and the number of children.
| Type of leave | Time period |
|---|---|
| Annual leave/Earned Leave | 11 days |
| Sick Leave | 0 days |
| Maternity Leave | 14 weeks |
When an employer decides to terminate an employee, they are required to provide a notice of termination that outlines the reasons for their decision. If the termination is immediate (summary dismissal), the employer may skip the notice period, but they must compensate the employee with a payment equivalent to 30 days of wages, which is referred to as a "notice allowance."
A notice period of up to 30 days is generally observed in Japan.
A severance pay is not mandatory in Japan.
A severance pay is not mandatory in Japan.
- Statutory leaves
- Pension or superannuation
- Old-age pensions leaves
- Disability pension
- Survivors' pension
- Social security
- National Health Insurance
- Longevity Healthcare System
After the client signs the SOW, the onboarding process typically requires two-three business days.
- Employee contract
- Japanese employment contracts do not have a mandatory language
requirement as long as all parties can comprehend the language used. Nevertheless, the majority of employers use Japanese as the language for such documents. - Probation period
- Establishing a probationary period of three to six months for new hires, starting from their employment date, is a customary practice in Japan.
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