When embarking on a new business venture in an unfamiliar market, a thorough understanding of salary standards is absolutely essential for a successful launch and sustained long-term growth. As such, becoming familiar with regulations surrounding the minimum wage in Japan is just one way in which you can prepare yourself for success in the Japanese market.
Mistakes or failure to meet industry minimums or benchmarks can significantly impact your legal compliance, as well as negatively affect job performance, long-term employee retention, and overall employee satisfaction. That’s why we’ve put together this guide on the minimum wage in Japan to help you stay on the right side of both the law and best practice.
How the Minimum Wage Functions in Japan
In Japan, salary standards have been established at the regional level since 1959. However, the system is regularly updated, and many jobs still rely on industry-specific minimum wage standards.
Salaries in Japan only apply to a worker’s standard pay. Extra payments or higher rates (such as those for work done on rest days or holidays) must be paid separately and are not included in the minimum wage calculation.
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Determining the Minimum Wage in Japan
The minimum wage in Japan varies by sector and area. Certain industries have industrial minimum salaries, which are typically higher than the regional minimum. The highest of the two minimum wage levels—regional and industrial—applies if they differ.
The minimum wage in Japan is typically set by the Chief of the Prefectural Labor Standards Office or the Minister of Labor, with recommendations from the Minimum Wage Council, who consider the costs of living and requirements in individual regions in order to establish the right minimum wage.
The Minimum Wage in Japan for 2024
Most prefectural minimum wages were last updated in October 2023. Current minimum wages per hour range from ¥1,113 (in Tokyo) to ¥790 (in Tottori).
As of January 2024, the top 10 minimum wages remain as follows:
| Prefecture | Wage (Yen) |
| Tokyo prefecture | ¥1,113 |
| Kanagawa prefecture | ¥1,112 |
| Osaka prefecture | ¥1,064 |
| Saitama prefecture | ¥1,028 |
| Aichi prefecture | ¥1,027 |
| Chiba prefecture | ¥1,026 |
| Kyoto prefecture | ¥1,008 |
| Hyogo prefecture | ¥1,001 |
| Shizuoka prefecture | ¥984 |
| Shiga prefecture | ¥976 |
Exceptions and Adjustments to the Minimum Wage in Japan
Unlike in many other countries, the minimum wage still applies in cases where an employee is still in their probation period. Additionally, there are no separate minimum wage requirements for younger workers.
The only case in which a worker may be paid under the standard minimum wage in their prefecture is during an apprenticeship or technical internship, in which case the worker is understood to be receiving compensation in the form of training, etc.
Also, wages may be reduced for workers who break a company’s rules, such as in the case of being late. As this is counted as a fine, it does not technically reduce the worker’s salary below the minimum wage.
The Minimum Wage in Japan During Special Work Hours
Employers are required to pay premium rates in addition to the employee’s basic wage when an employee is required to work on statutory holidays or over the stipulated working hours.
Overtime Pay
Any work performed in hours going over an employee’s regular working hours must be compensated with additional pay determined at a rate of at least 25% of the earnings payable for the regular working hours.
Work on Days Off or Holidays
In Japan, workers who report for duty on statutory holidays are entitled to an extra 35% on top of their standard pay for any hours performed.
Hours at Night
Employees must be paid an additional 25% for all hours worked during the night, which is defined as any period from 10 p.m. to 5 a.m.
Ensure Total Compliance in Japan with INS Global
In 2024, reports continue to abound of local and foreign companies facing significant fines or penalties in Japan for improper workplace practices. That’s why INS Global offers consistent and tailored support to help you understand local best practices and benchmarks in Japan.
INS Global facilitates a smooth entry into the Japanese market by bringing your company legal compliance assurance and the best in local resources. Our expert recruiting, payroll, compliance, and HR streamlining services are provided by our local Employer of Record (EOR) in Japan.
Contact our experienced global expansion advisors today for more information on ensuring a smooth transition into the Japanese market.
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