The Partial Amendment of the Employment Contract Act of Japan took effect on April 1st, 2013 and is designed to help employees who are on fixed term contracts that continuously get renewed. The rule states that any fixed-term contract employee who has had his or her contract renewed 4 times can apply for a change to an employment contract without a fixed term. This rule greatly benefits contract employees who have been stuck in a cycle of continuous contract renewal with no chance of becoming a permanent employee.
Japanese companies are required to grant 10 days of paid leave to employees who have been working continuously for at least 6 months and have reported to work at least 80% of the time. As the employee continues to work for the company, the number of paid leave days will increase by one additional day after the first year of employment to any increase of 10 additional days after working 6 years or more for the employer.
While it is possible to set up a Japanese company from abroad, some of the requirements to establish a company become more difficult if the founder is not present in Japan. Specifically, it can be quite difficult for the company founder to submit the required certificate of registration for their personal seal or find a company representative who is a resident of Japan.
The Employee’s Pension Insurance (EPI) is the mandatory national pension plan set up by the Japanese government. Participation is mandatory and all full-time employees who work for companies in Japan with 5 or more employees must be covered by the EPI. Part time workers are also covered if his or her work arrangements resemble those of a regular worker.