Author: M.Kok

What is a “Bonus”?

One of the many benefits of working in Japan is getting a bi-annual bonus (賞与 or ボーナス). Generally, Japanese companies offer summer and winter bonuses. It is an addition to the worker’s yearly salary (usually paid twice a year).

How Much are the Japanese Bonuses?

How much the bonus is, depends on factors such as seniority in the company, rank, company performance, individual performance and of course the nature of the job itself.

For example, the financial sector has the highest average bonuses ranging somewhere around 1,000,000 yen. The IT industry is in the middle with about 650,000 yen average, and the hospitality/restaurant industry is the lowest with around 100,000 yen (source).

The easiest way to guess what your bonus could be is to add six to eight weeks worth of salary twice a year.
To be sure, if you are entitled to a guaranteed minimum bonus study the contract.

Are the bonuses in Japan Taxable?

Sadly, yes.
You get taxed by yearly income, meaning bonuses are taxable.

Should you ask for a bigger bonus?

Negotiating your salary when looking for work in Japan has been considered taboo for some time now. Things are slowly changing, but more often than not asking for a higher monthly wage is still thought of as something you should not do.

The same goes for negotiating your bonus. Or rather, not negotiating it.

Some companies might even withdraw their offer if you ask for more money than the customary plus 5% rise from your last salary.

The only time you can be aggressive with salary negotiation is when you are being approached by a headhunting agency. This only goes for global companies operating in Japan as opposed to Japanese companies operating globally.

Conclusion

It is crucial to study and understand the employment agreement. The best thing to do is to establish if there is a guaranteed sum regardless of circumstances that might arise(e.g. Poor company performance, additional staff, hired, etc.), individual performance, sick leave and termination of employment.

You can ask at the interview or when you are using a proxy, (like a talent or HR agency) have them ask. It is unusual for Japanese companies to be deceitful about the work contracts and usually the better the bonus system is the more you hear about it.

 


By  M.Kok

Freelance writer and coding enthusiast.

Also a keen sportsman and painter.

👉Read more TalentHub blogs: https://talenthub.jp/blog/

 

 

 

 

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