In Japan, the standard workweek runs from Monday to Friday and includes 40 hours of work per week, unless otherwise agreed upon with a union or a representative of local employees. The agreement must specify the maximum number of hours of overtime work permitted.
Employers are required to compensate employees who work more than 40 hours per week. If the employee is a manager, he or she is expected to work overtime without compensation from the company.
If an employee is regularly expected to work overtime, a written agreement must be in place and filed with the Labor Inspection Office.
Overtime pay at the basic rate is 125 percent of the base hourly wage. Work on a rest day is compensated at 135% of the base hourly wage. Overtime paid late at night (between 10:00pm and 5:00am) is 150 percent of the base hourly wage. On a rest day, late night overtime pays 160 percent of the base hourly wage. Overtime work exceeding 60 hours per month is compensated at 150 percent of the base hourly wage. Overtime in excess of 60 hours per month is compensated at 175 percent of the base hourly wage.
Currently, small to medium-sized businesses are exempt from the last two rates. Additionally, “persons in supervisory or management positions or those who handle confidential matters” are generally exempt from overtime.