Japan The maximum monthly earnings for contribution and benefit Japan purposes are 620,000 yen. Exchange rate: US$1.00 equals 110.19 yen. The minimum and maximum earnings levels are adjusted on an ad hoc basis in line with the increase in the national average wage. Old Age, Disability, and Survivors Self-employed person National pension program: 13,300 yen per month. Regulatory Framework Employees’ pension insurance: Not applicable. First law: 1941 (employees’ pension insurance). Employer Current laws: 1954 (employees’ pension insurance) and 1959 National pension program: The contribution is included in the (national pension), with 1985 amendment. employer contribution to the employees’ pension insurance or Type of program: A social insurance system involving a flat- other employment-related program. A proportionate amount is rate benefit for all residents under the national pension transferred to the national pension program. program and earnings-related benefits under the employees’ Employees’ pension insurance: 6.79% of monthly payroll pension insurance program or other employment-related including salary bonuses before tax, according to 30 wage program. classes; contributions for miners and seamen, 7.48% of payroll Note: The provisions and rates are effective as of April 1, 2004. including salary bonuses before tax, according to 30 wage classes. Coverage If the employer is contracted-out, the contribution is between National pension program: Residents aged 20 to 59; 5.29% and 5.59% of monthly payroll including salary bonuses voluntary coverage for residents aged 60 to 64 (aged 65 to 69 before tax. in special cases) and for citizens residing abroad (aged 20 to The minimum monthly earnings for contribution and benefit 64). purposes are 98,000 yen. Employees’ pension insurance: Employees of firms in The maximum monthly earnings for contribution and benefit industry and commerce, including seamen. (Partial purposes are 620,000 yen. contracting-out from employees’ pension insurance is allowed The minimum and maximum earnings levels are adjusted on an if corporate plans provide equivalent or higher benefits.) ad hoc basis in line with the increase in the national average Special employment-related schemes for civil servants and wage. private-school employees. Government Source of Funds National pension program: One-third of the cost of benefits, plus 100% of administrative costs. Insured person Employees’ pension insurance: The cost of administration. National pension program: The contribution is included in the insured person’s contribution to the employees’ pension Qualifying Conditions insurance or other employment-related program. A proportionate amount is transferred to the national pension Old-age pension program. National pension program: Age 65 with a minimum of 25 years All other insured persons contribute 13,300 yen a month. of contributions (the coverage period can include years of Low-income spouses of workers insured under the coverage under any employment-related program belonging to employment-related program may apply for exemption from the insured’s dependent or common-law spouse). There is no payment. requirement to cease employment, and the pension is not Employees’ pension insurance: 6.79% of basic monthly earnings tested. earnings and salary bonuses before tax, according to 30 wage Early pension: An early pension is payable between ages 60 classes; miners and seamen contribute 7.48% of basic monthly and 64. There is no requirement to cease employment, and the earnings including salary bonuses before tax, according to pension is not earnings tested. 30 wage classes. Deferred pension: The pension may be deferred up to age 69. If the employer is contracted-out, the contribution is between Dependent supplement: No supplements are paid for a spouse 5.29% and 5.59% of monthly earnings including salary or children. (If the insured receives a supplement for a spouse bonuses before tax. under the employees’ pension insurance scheme, when the The minimum monthly earnings for contribution and benefit spouse reaches age 65 he or she will receive a pension under purposes are 98,000 yen. the national pension program equal to the employee’s pension