Social Insurance and Labor

As for the measures for overtime pay there is fixed overtime payment for the company which takes the system of annual salary.

For example annual salary 5 million yen is divided into 2 parts, basic annual salary 4

million yen and performance annual salary 1 million yen.

Fixed overtime payment, some portion of monthly salary allocated to overtime work

allowance, e.g. which is equivalent to 20 hours of overtime is putted into basic annual salary

Company manage hours of overtime by outside deemed working hour system.

For example when doing business outside is agreed on 7 hours and 30 minutes of

Regular working hours,

Working hours of employee who directory went to customer and went home is deemed 7 Hours and 30 minutes/

In the event that desk work plus business outside (ex. Comes to office in the morning,

do office work and go outside and come back evening and do office work for remaining

job), total working hours are 7 hours and 30 minutes plus times of office work.

Company manage working hours like this and company pay extra wage for overtime which exceeds 20 hours.

At first I think to grasp working hours is a start.

Company can grasp how many hours of outside business is appropriate time.

And company must know working hours from an aspect of safety consideration duty

on the health of employees.

1.Producing results in a short period of time was regarded as important. On the other hand important subject that should be worked on in a long term, difficult subjects and subject that is not outstanding but important became negligent.

2.In the aspect of personnel development, training of subordinates and younger employees came to be kept away.

3.As degree of difficulty of the objectives, generosity and severeness of evaluation were uneven in evaluation, the distrust of evaluation was born and reduced the motivation of employees.

4.As personal result is regarded as important, communication became thin and came to affect the cooperation with the neighborhood, mutual understanding.

Reflecting on negative effects of merit system, now Japanese company try to adopt new personnel evaluation system to evaluate by total in consideration of following three points.

1. Work : Do what kind of work

2. Role : A prospective work, for example achievement of the sales target, contribution of team work, education of subordinates, improvement and suggestion for the problems in the work

3. Result : Achievement degree for the prospective role

After collapse of the bubble economy, the earning capacity of the company declined.

Personnel and pay system was required to convert to so called pay system by merit system from conventional pay system based on age, length of service to the system that makes much of result.

The merit system was adopted in Fujitsu, Honda and many Japanese companies, however it is evaluated now most were failure.

Because the characteristic of the merit system is that salary amount is determined according to the result. Therefore employees do not become cooperative and are going to leave a good result by personal play. If it is a European and US companies, this means will raise the motivation of employees.

But in Japanese company an employee is registered at the same company for a long time, and the connection between employees is close.

Employees do not work in individuals but work by a team unit. Even if the merit system that demands a personal play is adopted, team play would be obstructed.

One of the characteristics of Japanese management is to develop personnel by letting them move premeditatedly and repeating OJT and duties experience.

How to decide social premiums of Japan

At first let me explain how to decide social insurance premiums of Japan.

Monthly insurance contributions are determined according to the salary amount of insured person and are to be equally shouldered by employer and the insured person.

Insurance contributions are also collected from bonus.

The calculation of insurance premium is to multiply the monthly standard remuneration by contribution rate.

Monthly standard remuneration is determined on the average of the salary of April, May and June. If there is no big change, this is applied for one year. In other word it means the premium does not change.

Company submits social insurance premium assessment basis forms to Pension Office in July.