Full explanation of the salary system in a Japanese company

As we have explained in the post on the Reality of Working in Japan even if a company does not meet your expectations in terms of salary, they might offer you great welfare which can boost up your quality of life.

Moreover, you must not worry even if the company which you are interested in is not a big corporation. For example, a venture company called Career Design Center have introduced a vacation program called "Scholarly Training", which entitles employees to 250,000 funds and 10 days of vacation for every five years of service. The basic condition of the program is to "go abroad," with the aim of broadening employees' perspectives and fostering their emotional development overseas.

Another example is a “synergy cafe”, incorporated by the GMO internet group where the company has hired a nutritionist who provides a healthy delicious meal for the employees. Since the meals are free, employees can save both time and money to go out to find restaurants and pay extra money for their meals.

These two companies are just a few examples of Japanese companies regardless of their size which install unique and effective benefits to their employees. Furthermore, foreign applicants might be worried about the low wage in the rural areas of Japan, compared to big cities like Tokyo.

However, one must not worry since in rural areas like Shikoku area, rent is much cheaper, and one can often live in a larger house for the same amount of money as one would have had to pay in Tokyo. Despite the relatively low wage, living in a large house surrounded by the beautiful nature of Japan is a great merit of living in the rural areas which one cannot miss.

Therefore, we highly recommend for you to not only look at the salary but also take a peek into the benefits which the company offers.

Getting a promotion is something which everyone will try to aim for in order to rise to a higher position and gain a bonus.Some may have the notion that in a large Japanese corporation, a seniority-based pay system is still prevalent which is a personnel system that increases positions and wages based on length of service and age.

However, this system has been decreasing, and many corporations are now making an effort to switch to a performance-based personnel system, which is a  personnel system in which wages and positions are determined by an individual's ability and contribution to the company, regardless of age or length of service. In the performance-based personnel system, most companies have an evaluation meeting with the supervisor once in a half year.

This evaluation determines promotions and bonuses for the employees. Concerning how much an employee can get in a bonus, while this depends on the size and industry of the company, according to the preliminary results of the "Monthly Labor Survey" conducted by the Ministry of Health, Labour and Welfare for September 2022 and February 2023, the average summer bonus for 2022 was 389,331 yen and the average winter bonus was 392,975 yen. Generally, one bonus is equivalent to approximately one to two months of base salary. ( reference: https://www.mhlw.go.jp/toukei/itiran/roudou/monthly/r05/2302p/2302p.html, https://www.mhlw.go.jp/toukei/itiran/roudou/monthly/r04/2209p/2209p.html)