A man filling in the report sheet with a pen

Japan’s laws on working hours, breaks, off days and paid leave are intricate and reflective of Japanese culture. Like other regulations covered by the Labour Standards Act, employee welfare is put at the forefront with these rules, and it is imperative that corporations comply with these laws. However, the company is still allowed to lay down rules beneficial to the businesses’ needs in work agreements, and employees are held accountable for their willingness to accept benefits offered and use them in a wisely.

Working Hours, Breaks, Days Off

  • “Statutory working hours” are not to exceed 8 hours per day and 40 hours per week including breaks. However, some businesses such as retail and beauty services, cinemas, theaters, healthcare, restaurants, and entertainment businesses with less than 10 employees are allowed to have employees work up to 44 hours per week at no more than 8 hours per day.
  • Employees working 6 hours must receive no less than a 45-minute break. For shifts of 8-hours or more, the break time must be one hour.
  • “Statutory days off” include at least one day off per week, or four days off in any four-week period. Sundays or public holidays are not mandatory days off, and other days may be selected for off days as agreed between the employer and employees.

Agreements on Overtime and Work on Days Off

Employers requiring work in excess of statutory working hours or on statutory days off must submit a Notification of Agreement on Overtime and Work on Days Off to the chief of the relevant labour standards office. Employers that force employees to work overtime or work on days off without submitting notification documents may be penalized.

There are still limitations for overtime work even with a Notification of Agreement on Overtime and Work on Days Off. More details on these limitations can be found on JETRO.

Employers’ “Obligation to Ascertain and Calculate Working Hours”

Time placed within the discretion of employers and time employees engage in said work by explicit or implied instruction are considered working hours. The Labour Standards Act has outlines provisions on working hours, holidays, overnight and overtime work as well as other conditions.

It is imperative for employers have objective work time recording devices to properly ascertain and control working hours and time sheets, even if employees submit time cards on their own.

Overtime Payment

The table below outlines the increased wage rate required by the Labour Standards Act to be paid to employees who work overtime. Items 2 and 6 show changes in the Labour Standards Act that took effect in April of 2010 and do not apply to small and medium sized businesses for the time being. Additionally, employers are allowed to offer paid leave in lieu of overtime wages.

 

ClassificationRate of Increase
1.     Work time over of statutory working hours25%
2.     Work time over statutory working hours exceeding 60 hours in a month50%
3.     Work on statutory days off35%
4.     Late night work between 10 pm and 5 am25%
5.     Late night work time over statutory working hours50%
6.     Late night work time over statutory working hours exceeding 60 hours in a month75%
7.  Late night work on statutory days off60%

Exceptions for Managers and Supervisors

 People holding management or supervisory positions as well as those in confidential administrative support roles close to management are not subject to work regulations including working hours, breaks, and off days. Management or supervisory status are determined by the factors below:

  • The involvement of management in the decision-making process about his or her employment
  • Practical authority over business matters regardless of title
  • Strict limitation of work hours such as office hours
  • Earning a salary, bonus, or other financial incentive equivalent to what a manager would receive

Modified Working Hour System

 Some companies are allowed to calculate work hours via a system that does not pay increased rates for overtime during certain weeks or days. This is stipulated by an employee not working more than the average number of statutory working hours within a predetermined period. A labour-management agreement must be entered into or provisions outlined in work rules before a flexible system can be adopted.

  • System of Annual Modified Working Hours

Average employee working hours cannot exceed 40 hours per week for a period of more than one month and no more than one year. Companies under this system, even if they employ 44-hour work weeks, are subject to the 40-hour average.

  • System of Monthly Modified Working Hours

As long as it is documented that employee work hours above 40-hours is prohibited on an average work week for no more than a month, the employer may have employees work over 40-hours in a work week or 8-hours in a day.

  • Flextime System

The Flextime System allows working hours to be adjusted within a monthly period, where the total number of working hours for a fixed period of no more than a month are established. Also, workers are free, within some limitation, to determine their work schedule so long as they work their required number of hours for the week.

 

  • Week-Based Modified Working Hours

The Week-based System allows employers to have employees to work for more than 8-hour but no more than 10 hours per day as long as the work week does not exceed 40 hours. This system is limited to retailers, inns and restaurants with less than 30 regular employees. Also, companies that adopt this system as well as workers who opt for 44-hour work weeks are subject to the 40-hour average requirement.

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System of Discretionary Working Hours

Ordinary methods for time keeping may not be best for employees who work outside of the company or progress of work is left to the discretion of the employee. In these cases, the “deemed working hour” system – where employees are deemed to have worked a certain number of hours – is appropriate. If the deemed working hours exceed statutory working hours, then overtime rates will be applied.

  • System of Deemed Working Hours Outside the Workplace

This system deems that employees have worked required working hours in situations where it is difficult to calculate the employee’s working hours due to outside work including sales, media coverage, etc. However, if employees need to work more than the deemed number of hours, then the work will be deemed “hours generally required to perform those services” or “hours prescribed in the labour-management agreement.”

  • Discretionary Working System for Professional Services

High level professional services with highly specified instructions that are difficult to convey regarding performance and time allocation can allocate work hours through a labour-management agreement and submit it to the chief of the relevant labour standards inspection office. It will be deemed that employees worked to allocated number of hours in the agreement regardless of the actual working hours.

  • Discretionary Working System for Planning Services

People who engage in planning, plan proposals, research and analysis services where the method of performance is left to the employee’s discretion extensively, can resolve matters with majority of 4/5 or more of committee members at the labour management committee and then register the matter with the Labour Standard Inspection Office. It will then be deemed that the planner or researcher will have worked to allocated number of hours in the work agreement regardless of actual hours worked.

Paid Leave

Employers must award 10 days of paid leave to employees who meet the following requirements:

  • Worked for 6 consecutive months from the time of hiring
  • Worked no less than 80% of all scheduled work days

The number of paid leave days increases in proportion to the employee’s length of service. Part-time employees with few work days and short work hours are awarded annual paid leave in proportion to the number of scheduled days worked. Paid leave can be taken consecutively or separately, and if an application for paid leave interferes with business performance, the employer may exercise discretion in requiring the employee to choose a different time.

Annual paid leave rights are valid for up to two years, meaning that left over paid time off from the previous year can be rolled over to the next year’s paid time off balance and used then. However, employees who have been continuously employed at the same company for no less than 7 years and 6 months are allowed a maximum of 40 paid leave days for one year, which can be carried over to the next year.

Employees who choose not to fully exercise their paid time off rights before they expire, the decision to grant the payout of the paid leave days is left to the agreement with the company. However, this approach is not preferred, as such arrangements can be used to discourage employees from using paid leave benefits.

Previously, annual paid leave had to be taken in units of whole days. Now, up to 5 days’ worth of paid leave per year can be taking in hourly units as outlined in a labour-management agreement.

Employers are not mandated to give sick days. However, most Japanese companies give a few additional paid leave days for marriage, bereavement, and childbirth.

Maternity, Childcare and Family Care Leave

Maternity Leave

Employees who are expectant mothers can make a leave request 6 weeks before the due date. If there are multiple pregnancies, then 14 weeks advance notice is allowed with employer approval.

Employers are prohibited from forcing female employees to work after birth for 8 weeks.

Childcare Leave

Employees with children younger than one-years-old can request paid leave, and the employer must approve the request. Employers may deem employees who have worked with the company for less than one year to be ineligible for childcare leave. However, the employer must make the stipulation clear in the original labour-management agreement.

Exemption from Non-Scheduled Work, Obligation for Short-Time Working System, and Limitation of Overtime Work

Employees with children under the age of three who request exemption from non-scheduled work cannot be required to work overtime. Employees with children under the age of three may request a short-time working system, and the employer must approve the request. Employees with children of preschool age may request exemption from non-scheduled work and cannot be required to work overtime over 24 hours per month or 150 hours per year.

Family Care Leave

Employees with family members who are in need of nursing care may request leave of absence to provide said care, and the employer is required to approve the request in up to three separate periods totaling 93 days per family member in need of care.

Per a labour-management agreement, the employer can deem an employee ineligible for family care leave according to the following criteria:

  • who worked at the company for less than a year
  • will end employment at the end of the 93-day period
  • 6-month pass from scheduled start state of family care leave.

Leave of Absence to Nurse a Child or to Take Care of Family

Employees with children of preschool age may request to nurse his or her sick or injured child and receive leave of absence for up to five days per year, 10 days for more than one child. Employees with family members in need of nursing care may request leave of absence for up to five days per year, 10 if there is more than one family member. Such leave can be taken in half-day increments.

All the above periods of leave may be unpaid; however, employees may receive some benefits through health insurance coverage during period 1 and under employment insurance coverage during periods 2 and 4 listed above.

Investigations by Labour Standards Inspectors

Labour Standards Inspectors are professional staff members of the Ministry of Health, Labour and Welfare who enter business sites (factories, offices, etc.) under the authority of Japanese labour laws and regulations. These inspectors observe how employer compliance with laws and regulations, and they ensure sound working conditions as well as the welfare of workers. They are also responsible for ensuring those who suffer labour-related accidents receive workers’ occupational accident compensation.

Summary

Japanese labour laws pertaining to working hours, days off, and paid leave are intended to prevent overwork of employees and protect the needs of the family. However, it seems that the best benefits are awarded to professionals and high-level employees. Service industry businesses including restaurants, retail, and healthcare have more flexibility in scheduling employees outside of statutory work days or statutory off days, which can hinder employee’s freedom in taking advantage of benefits for time off. Yet, any employee who has small children, is about to birth a child, or needs to care for elderly or disabled family members are given abundant paid leave benefits. Thus, it’s important to consider the requirements for breaks, time off, and paid leave when determining the nature of your business and its employee structure.

Working hours, breaks and days off FAQ

What are “statutory working hours”?

“Statutory working hours” are work shifts limited by law. They are not to exceed 8 hours per day and 40 hours per week including breaks. However, some businesses such as retail and beauty services, cinemas, theaters, healthcare, restaurants, and entertainment businesses with less than 10 employees are allowed to have employees work up to 44 hours per week at no more than 8 hours per day.

What are “statutory days off”?

“Statutory days off” are scheduled off days required by law. They include at least one day off per week, or four days off in any four-week period. Sundays or public holidays are not mandatory days off, and other days may be selected for off days as agreed between the employer and employees.

Overtime

Are employees allowed to work overtime?

Yes. However, employers that offer this option must submit a Notification of Agreement on Overtime and Work on Days Off to the chief of the relevant labor standards office. Employers that force employees to work overtime or work on days off without submitting notification documents may be penalized.

How does overtime pay work?

Overtime pay is calculated by adding a percentage increase to the base pay according to the additional number of hours worked and whether the shift is during the day or overnight.

Working Hour Systems

Which is better: the modified working hours system or discretionary working hour system?

The modified working hour system works best for in-house employees that work regular schedules, as it helps to keep working hours within statutory limits. Discretionary systems work best for employees who typically work “in the field” or outside of the office, as it ensures that fair pay is distributed without direct supervision of work. Each system is preferable based upon the type of work performed by employees and in what location.

Family Care Leave

Employers give vacation time and family leave, but what if I get sick outside of these paid leave days and cannot go to work?

Sick leave is not legally required un Japanese work regulations; however, most employers offer sick leave, just in case.