Japan’s Employee Benefits News for Q2 2024
As provided by Cornes, Japan’s employee benefits news for Q2 2024 includes information about new terms of employment, increases in in-kind benefits for meals, new requirements for the discretionary work system, public insurance for childbirth, forecasted deficits for health plans, and social insurance for part-time employees.
New Requirements for the Terms of Employment
as of April 1, 2024, employers with 10 or more employees are required to notify their employees of any changes to their terms of employment. In addition, they will be required to notify fixed-term employees of the maximum number of contract renewals for which they are eligible and the total maximum period of employment allowed by all contract renewals. These are some of the conditions that must be covered under the work rules:
- The starting and ending time of work, rest breaks, holidays, leave and vacation time, shift work
- Dates of salary and the method of determining salary and salary increases
- If retirement allowances are provided, then the work rules must include eligibility requirements, method of determining payments, and date of payments
- Reasons for termination of employment for just cause
Other items, such as safety and health, overtime pay, vocational training, accident compensation, and employee work supplies and expenses, may be included in the work rules but were not previously required.
Employers are also required to notify fixed-term employees who have worked for a single employer for 5 years or more that they have the right to apply for conversion to indefinite status and provide the proposed terms of employment after such a conversion.
In-kind benefit value of a meal increased
Effective 1 April 2024, the Ministry of Health, Labor, and Welfare increased the determined values of meals provided to employees, considered to be in-kind salary for employees under the Employees’ Pension Insurance or National Health Insurance. These set values vary per meal, per day, and per month, as well as across prefectures.
As of 1 April 2024, the prefecture with the highest allowed in-kind meal benefit is Okinawa, with a monthly limit of JPY 24,000 (increased from JPY 23,400 in 2023) and a daily limit of JPY 800 (increased from JPY 780 in 2023). Individual meal values range from JPY 200 (for breakfast) to JPY 320 (for dinner).
The benefit limit in Tokyo did not increase in 2024, remaining at JPY 22,800 per month and JPY 760 per day. Individual meal values range from JPY 190 (for breakfast) to JPY 300 (for dinner). Other in-kind benefit limits, such as the rental benefit, did not increase in 2024.
New requirements for the discretionary work system
Effective 1 April 2024, under the Ordinance for Enforcement of the Labor Standards Act in relation to the Discretionary Labor System, employers in Japan are required to seek the permission of individual employees before implementing a discretionary labor system (DLS).
Previously, employers only had to seek the agreement of a labor representative who represented a majority of all the employees before implementing a DLS that covered the entire labor force.
Japan to discuss public insurance coverage of childbirth
The government is set to start full-fledged discussions as early as this month on the idea of extending public health insurance coverage to include childbirth from fiscal 2026.
The government will also consider setting a uniform price for delivery support and related services at hospitals and other facilities in a bid to curb rising expenses as part of measures to tackle Japan’s declining birth rate.
As part of a strategy adopted at a Cabinet meeting in late 2023 to ensure the nation’s demographic future, the government announced it would consider covering childbirth costs with public medical insurance.
The current coverage does not extend to childbirth costs in general, with a handful of exceptions, including cesarean sections.
The health ministry and the Children and Families Agency are slated to establish a panel of experts as early as June to discuss insurance coverage for childbirth and other related issues. The average of childbirth costs across the country stood at some ¥482,000 in fiscal 2022.
Health Insurance Association deficit forecast: 90% of the association’s forecast deficit of 657.8 billion yen.
The Health Insurance Federation of Japan (KHFR) has announced that 90% of health insurance societies (kenko hoken kumiai), in which employees of large companies are members, are expected to record a deficit in the financial year 2024.
The Federation of Health Insurance Associations (FHIA) announced this on 23 April. The high level of medical costs and the increase in contributions to the elderly generation are the main reasons behind the severe financial situation. read more
Social Insurance for Part-Time Employees
Currently, companies in Japan with 101 or more employees are required to cover part-time workers who work 20 hours or more per week for social security insurances. Still, this rule will be extended to companies with 51 or more employees from October 1, 2024.
Employers must enroll all part-time employees who work at least 75% of a full-time employee’s working hours. For part-time employees who work less than this, the following criteria must be met in order to enroll them:
- They are not a student
- Their prescribed working hours per week are at least 20 hours
- Their monthly salary is at least JPY 88,000
- They are expected to continue their employment for more than 2 months
This article about Japan’s Employee Benefits News for Q2 2024 is provided by Cornes, Asinta’s benefits consulting Partner in the country. If you need support with your employee benefits in Japan, please contact Asinta, and we will put you in touch with the local experts at Cornes.