Complete Guide to Employer Statutory Costs in Japan (2025)

Employees' pension insurance is Japan's primary public pension. The premium rate is 18.3% of the standard monthly remuneration, split equally between employer (9.15%) and employee (9.15%). The standard monthly remuneration is capped at Grade 32 (JPY 650,000/month). This provides old-age, disability, and survivors pension benefits.

Under the Japan Health Insurance Association (Kyokai Kenpo), the premium rate varies by prefecture but is approximately 9.8-10.0%, split equally. The cap is JPY 1,390,000 per month. Long-Term Care Insurance (Kaigo Hoken) applies additionally for employees aged 40-64, adding approximately 1.6% (split equally). Health insurance covers medical expenses, maternity benefits, and sickness allowances.

Employment insurance (Koyo Hoken) for 2024 is 0.95% employer plus 0.6% employee for general industry. It funds unemployment benefits, childcare leave, and re-employment support. Workers compensation insurance (Rousai Hoken) is 100% employer-funded, with rates ranging from 0.25% to 8.8% depending on industry. Office and retail typically pay around 0.3%.

Total employer statutory costs in Japan typically amount to approximately 15-17% of gross salary. This includes 9.15% for pension, approximately 5% for health insurance, 0.95% for employment insurance, and 0.3% for workers compensation -- totalling roughly 15.4% for general industry. For employees aged 40+, long-term care insurance adds another 0.8%. Japan's employer costs are comparable to those in South Korea and moderately higher than Hong Kong or Singapore.