Employing in Japan
The minimum wage in Japan varies regionally, but in 2025 the average across all prefectures is ¥1,054 per hour, with Tokyo being the highest. The minimum wage ranges between ¥900 and ¥1200 depending on variations in regional economic markets and cost of living.
The individual income tax contributions in Japan range from 5% to 45% and are based on the threshold of income. In addition, there may be other surtaxes and local income taxes required.
Private sector employees are covered by the Employee’s Pension Insurance, and public sector employees are covered by the Mutual Aid Associations.
Both employees and employers make an equal contribution to this fund which totals 18.3% of the employee’s salary (so 9.15%).
On average, a full-time working week ranges from 35 to 40 hours per week, Monday to Friday between 9am and 5pm. There are of course other industries with different working patterns, which can sometimes include weekends or unsociable hours.
Working hours in the UK are governed by the Working Time Regulations, which stipulate that an employee cannot work more than 48 hours per week on average, but an individual can choose to opt out of this.
Employee’s leave consists of several types:
- Statutory time off or paid leave, which starts at 10 days paid leave for up to 6 months employment, and increasing with length of service
- Public holidays (there are 16 in Japan)
- Maternity, Paternity and Childcare leave
- Other leave (e.g., bereavement leave)
Termination of an employment contract in Japan is complex and varies depending on the employment contract in place. Due to its complexity, termination of contract is nearly always done via mutual agreement, as an employer cannot terminate without due cause, which under Japanese employment law is very difficult. Employers must provide a minimum of one months’ notice upon termination, however the same obligation is not placed on the employee.
For more information about termination, please contact us.
