Japan’s policies for accepting foreign nationals have gotten underway, and the number of foreign residents continues to rise. As more companies hire foreign workers, enrollment in social insurance is required when concluding an employment contract after obtaining a status of residence, as part of the procedures for employing foreign nationals.

Employees’ Pension Insurance and Health Insurance Applicable to Foreign Nationals

Foreign residents are eligible for social insurance on the same basis as Japanese nationals and may enroll when certain conditions are met. Specified Skilled Workers and technical intern trainees are also among those eligible to enroll.

Since July 2012, foreign nationals have also been covered by the Basic Resident Registration system, and enrollment in National Health Insurance is required.

When a company that employs foreign nationals is enrolled in health insurance, Employees’ Pension Insurance, and related programs, the employer is obligated to enroll those foreign nationals in health insurance, Employees’ Pension Insurance, and related programs.

If the company is not enrolled in health insurance, Employees’ Pension Insurance, or related programs, foreign nationals may enroll in National Health Insurance and the National Pension through the municipality where they reside.

In the case of sole proprietors, if the business is a compulsory applicable establishment with five or more employees, there is an obligation to enroll foreign nationals in social insurance.

※Compulsory applicable establishments

Manufacturing / civil engineering and construction / mining / electricity and gas utilities / transportation / cleaning / merchandise sales / finance and insurance

Storage and leasing / brokerage and agency / collection, guidance, and advertising / education, research, and investigation / medical and health care / communications and reporting

For Employees’ Pension Insurance and health insurance, application procedures are filed with the Japan Pension Service within a five-day submission deadline.

https://www.nenkin.go.jp/service/riyoushabetsu/jigyonushi/index.html

↑ Japan Pension Service: Employees’ Pension Insurance and health insurance

Social Insurance Enrollment Also Applies to Foreign Part-Time Workers

Even when foreign nationals work part-time, whether they enroll in social insurance is determined by their working conditions.

For part-time work under permission to engage in activity other than that permitted under the status of residence, social insurance enrollment is determined based on the working hours and working days of regular employees at the same workplace.

The following foreign part-time workers are obligated to enroll in social insurance.

・Weekly working hours are at least three-quarters of those of regular employees, and monthly working days are at least three-quarters of those of regular employees

・Weekly working hours are 20 hours or more

・The person is a working adult, not a student

・The part-time work is at a specially applicable establishment

・Monthly income is 88,000 yen or more

・An employment contract of one year or longer has been concluded

Presentation of an Insurance Card Required for Status of Residence Renewal

When employing foreign nationals, since April 2010, presentation of an insurance card has been required when renewing or changing a foreign national’s status of residence.

This condition was established by the Ministry of Justice to promote social insurance enrollment among foreign nationals and to centrally manage their residence status.

About the Lump-Sum Withdrawal Payment

When a foreign national returns to their home country, a certain amount may be refunded based on contributions paid, within two years after they no longer reside in Japan. This is called the lump-sum withdrawal payment.

A lump-sum withdrawal payment may be claimed if the person has been enrolled in Employees’ Pension Insurance for six months or more.

For foreign employees who complete their period of stay and return to their home country, explain the lump-sum withdrawal payment system and proceed with the necessary procedures.

https://www.nenkin.go.jp/service/jukyu/sonota-kyufu/dattai-ichiji/20150406.html

↑ Japan Pension Service: About the lump-sum withdrawal payment

About Employment Insurance for Foreign Nationals

When employing foreign nationals, enrollment in employment insurance is required.

As with Japanese employees, procedures at Hello Work are required when hiring or separating foreign nationals.

This applies to foreign nationals staying in Japan under any status of residence other than “Diplomat” or “Official.”

Enrollment is required when a foreign national has an employment contract of 31 days or longer and works 20 hours or more per week.

Notifications are filed in accordance with the information on the foreign national’s residence card.

https://www.hellowork.mhlw.go.jp/insurance/insurance_guide.html

↑ Hello Work: Guide to employment insurance procedures

About Workers’ Accident Compensation Insurance for Foreign Nationals

Foreign nationals are also obligated to be covered by workers’ accident compensation insurance on the same basis as Japanese employees.

Enrollment in workers’ accident compensation insurance is necessary to cover medical costs for accidents or illness occurring during work.

When hiring a foreign employee, file a Notice of Establishment of Labor Insurance Relationship with the Labor Standards Inspection Office within 10 days.

If a work-related accident occurs involving a foreign national whom the employing business has not enrolled in workers’ accident compensation insurance, insurance premiums will be collected from the employer.

The condition for workers’ accident compensation insurance enrollment is that coverage is required even when only one employee is hired.

It also applies to foreign nationals who hold a status of residence and to those working part-time under permission to engage in activity other than that permitted under the status of residence. Workers’ accident compensation insurance also applies even to overstayers who do not hold a status of residence.

About Social Security Agreements

Social security agreements are agreements concluded to avoid double payment of social insurance premiums in both the country of employment and the home country.

Agreement countries: Germany / United Kingdom / South Korea / United States / Belgium / France / Canada / Australia / Netherlands / Czechoslovakia / Spain / Ireland / Brazil / Switzerland / Hungary / India / Luxembourg / Philippines / Slovakia / China /

Summary

The social security systems available to foreign nationals are essentially the same as those for Japanese employees.

When employing foreign nationals, thoroughly explain the structure of systems that may be difficult for foreign employees to understand, and why contributions are required, so that they gain a clear understanding.