Salaries in Japan

[TokyoWart]

I'm absolutely looking for someone who will stay with us indefinitely, somebody who can expect their rewards and responsibilities to increase as the company grows and prospers.

Great! I hope this works out well for you. I can't imagine running my own business as you are doing; I'm impressed.

[KyushuWoozy]

OP is trying to decide if they should pay, 270,000 yen per month over a 12 months or to pay 232,000 (14months) and then give the worker the rest of THEIR salary by pretending the rest is a BONUS.

No. I was trying to compare the two sets of data and provide a possible explanation as to how they differed so much. Sorry if my meaning wasn't clear.

[Bubblegun]

Bubblegun,

I think you make several good points including the difficulty in evaluating job performance to award a higher or lower bonus and that if the bonus is not going to really equate with what we intuitively mean by "bonus" then it is effectively just withholding monthly compensation until the payout periods. (Although it does get better tax treatment when awarded because inhabitants tax (住民税) isn't taken out of the bonus at the time of payment.) I also agree that bonuses confuse (or skew) understanding of what compensation really is when people only report monthly income and the listener doesn't realize that yearly income is going to be 16+x that monthly figure.

That said, performance does differ, even among us healthcare workers (I'm a physician) and within companies the bonus system helps reward outstanding performance especially for younger employees because they are evaluated relative to expectations for their salary grade. For the small business KyushuWoozy is running this might not be as big an issue but in the department of 50-odd employees that I manage, the bonus system is seen as an important tool to give feedback (both positive and negative) to people about how they are doing. We put a lot of effort into those bonus evaluations. They get reviewed by the employee's immediate manager, the manager's manager and a committee I chair with all departmental managers twice a year. Then in addition I have to defend our assessments to our personnel department.

Thats great to see. As you know in the healthcare profession, certainly in mine, we were compensated inline with further training,EG CBT, ECG, phlebotomy skills, opthalmic skills, and even danger pay.(psychiatry).

Here is one question though,, how do we compare an employee with a chronic condition, works well, but sadly has had some time off sick with another employee who is well, and does the same job?

Actually now that you mention a tax break... I was theorising if there was some kind of tax benefit, because there would seem no logical reason for it.

I do expect further pressure to increase on salaries, because i think, with the recent pension argument in the JPN gov, the gov will force every worker to take an IdeCo and get every worker to pay 2% or 3% into it. Again reducing the persons monthly income, and by increasing the availability of workers from other countries, there will be no need to increase monthly salaries or even bonuses.

Btw I do digress, I wonder what is your speciality?
Mine was Opthalmoligy and psychiatry.

[Bubblegun]

OP is trying to decide if they should pay, 270,000 yen per month over a 12 months or to pay 232,000 (14months) and then give the worker the rest of THEIR salary by pretending the rest is a BONUS.

No. I was trying to compare the two sets of data and provide a possible explanation as to how they differed so much. Sorry if my meaning wasn't clear.

No worries KyushuWoozy. Sorry if I misunderstood.

[TokyoWart]

Here is one question though,, how do we compare an employee with a chronic condition, works well, but sadly has had some time off sick with another employee who is well, and does the same job?

Evaluations are based on performance, often against numerical goals, so if someone did not reach the objectives that they set at the beginning of the year they will be marked down accordingly. When people are absent for months because of illness they are put in a different category and not evaluated for performance.

I do expect further pressure to increase on salaries, because i think, with the recent pension argument in the JPN gov, the gov will force every worker to take an IdeCo and get every worker to pay 2% or 3% into it. Again reducing the persons monthly income, and by increasing the availability of workers from other countries, there will be no need to increase monthly salaries or even bonuses.

I know there have been recent articles about low wage growth in Japan but I don't think they are accounting for the effects of demographic shifts on wages (i.e. the downward effect from more older new retirees than young, fresh graduates joining the workforce each year) and they ignore bonuses which were a record high last year. What I see is higher wages and better wage mobility for university graduates and those at established companies. The newest employees hired right out of universities today are better compensated and have more legal protections on work hours than 10 or 20 years ago.

I wonder what is your speciality?

Urology. Most of my work during residency was in prostate cancer or infertility.

[KyushuWoozy]

I can't imagine running my own business as you are doing; I'm impressed.

Every business owner started out as a complete beginner somewhere down the line. Hope you manage it one day, it's the best move I ever made.

[captainspoke]

It has changed now, but I think at one point, bonuses (while of course taxed) did not have a couple of the other deductions taken out that were there for monthly salary.

[KyushuWoozy]

How normal here is it to pay transport allowance (for full time staff)? I mean, is it normal and expected? If yes, is it calculated based on actual amount spent by the staff or a random fixed amount?

If you guys don't mind sharing, do get it and how much?

[TokyoWart]

It’s the case where I work (based on actual cost) for all seishain. It was also true for my wife when she was an English teacher and had to travel between several different schools.

[seb]

Hello,

For transportation fees, even my baito back in school would pay a full allowance. A few workplaces ask for a receipt of the monthly train pass, while other just ask for the route you take and pay that amount each month. 99.9% will declare a more expensive route than they actually take (even buy the expensive pass, show the receipt, then exchange it the next day to the cheaper route, etc...): that's just part of the game.

For salary level, bigger companies pay less the first year because they can (the parents will be proud of them working there...) and also because there is indeed a training period like you mentioned in the first post. The number of years your company has been in business can help get trust too from new grads. There is also a lot of Japanese (usually who speak better English) who would hate working for a Japanese company.


The other conversation here about bonuses: I was working for a foreign company on a 12 month salary. It was bought by a big JP company and I stayed enough to see the offer they had for converting the contracts to their standards: cut monthly salary by 20%, and offer the rest in 2 bonuses (variable ones of course). After delving into the "standard work agreement" (to be found separately deep in the intranet), I found out overtime were paid based on the monthly salary. Most of my JP colleagues doing about 10 hours of overtime per week would get an effective cut of 20% in full annual salary if I remember correctly. (average overtime per month per employee disclosed by HR was over 60 hours...)