For those that are used to being paid on a biweekly basis Japan’s pay cycle may seem harsh. In Japan, you’re only paid once a month, usually on the 25th of each month (and if the 25th falls on a weekend or a holiday, then the nearest weekday before the 25th). This practice is wide spread due to Labor Standards Law Article 24 Paragraph 2 which states that “Wages must be paid at least once a month at a definite date”. This created the practice of paying employees on the 25th of each month, and not every other week. Of course, it’s perfectly ok and legal for companies to switch over to a biweekly basis (well, not exactly biweekly as in the U.S., but I’ve seen expatriates being paid on the 10th and the 25th of each month, or on the 15th and 30th), but in many cases, the benefits outweigh the costs so companies and businesses are reluctant to change this practice.
What this once-a-month-pay creates is the need to budget your monthly spending. If you were paid on a biweekly basis, you can pay your rent, go shopping in Aoyama or Omotesando, hang out with your friends at Roppongi, dine at nice restaurants in Ebisu, etc., etc. for the first week after your paycheck and cut back the following week till you get your next paycheck. But if you do that in Japan, you’d be in a tight financial position for the remaining three weeks. Maybe this is one factor why the savings rate in Japan is higher than in U.S. Many people in Japan have no choice but to save as much money as possible until their next paycheck and this builds a saving habit.
Thinking about working in Japan? Preparing to move overseas almost becomes a full-time job in the final weeks of your departure. Many people quit their jobs weeks before so they can devote their time to preparation. But what about your health insurance? Short-term health insurance plans are a great solution. ↓
Below are links to Certified Social Insurance and Labor Consultants providing services in English. Also below are useful links related to working in Japan and links to women balancing career and personal happiness. WJA realizes and promotes women's increasing value in the labor market.