|VISA Q and A on FM COCOLO 76.5 MHz
Social and Employment Insurance
On Aired Data: March 20& April 3, 2001
Japanese male who runs an advertising company.
There are 3 Japanese and 2 foreign employees at his company, which are all under the Social and Employment Insurance. But recently he has received requests from his foreign employees that since the monthly insurance fees are too expensive, they don’t want to pay it anymore, even if it means that they won’t be covered by the insurance. The employer thought it was for the employee’s sake to put them under insurance, so he was surprised to hear their request. What our client would like to know is what are the advantages and disadvantages of paying the Social and Employment Insurance fees.
The Employment Insurance covers you when you have lost your job, either for your own reasons or if you have been released or your company has gone bankrupt. Depending on the reason why you have lost your job, and the term of how long you have been covered, you can receive a certain amount of allowance for a certain period of time. Any company who employs workers are required to join this system, and employees who fall under the bellow basic terms, will be eligible to receive those allowances:
1) Have joined the system for six months or longer during the year prior to the date when they resigned or lost their job
2) When it is confirmed that the worker has failed to qualify as an insured person because he/she has resigned or lost hi/her job
3) The worker cannot find a job although it is his/her intention to find a suitable employment
To give you a brief idea of the amount of the allowance, let’s say there was a 35 year-old person who worked for a certain company for 5 years, and one day his company went bankrupt. If the Employment Insurance covered him, he will be benefited for 180 days. The amount of the allowance is calculated according to the salary one was paid, the last 6 months from his former employer. Very complicated mathematics is involved, but to give you a rough idea of the amount, it is something around 60% of what you have been paid. There is a difference according to your salary, and how long you have been employed. In this example case, a 35 year-old person was employed for 5 years, and his company went bankrupt he would receive benefits for 180 days, whereas a 40 year-old person who was employed for 10 years would receive the benefit of 210 days. The monthly fee deducted from your salary would be something a few thousand yen, depending on your monthly salary. But if you realize the benefits you can receive, it maybe worth it.
A combination of Health Insurance and Welfare Pension Insurance. An office that has 5 or more employees, or any corporation that has one or more employees must join the insurance system.
The Health Insurance helps you pay your medical fees. Those who are hired by a company belong to the Social Insurance, whereas the National Health Insurance covers those who are self-employed, students or others who are not under the Social Insurance. If you belong to the Social Insurance, your employer pays half of the monthly Insurance fees, and your part of the payment is deducted from your monthly payment. The monthly Insurance fee for a person who earns 200,000yen a month would be 17,000yen, and your employer pays half, meaning you pay 8,500yen monthly. And if you are the one signed up, you have to pay only 10% of the medical fee, and for family members the payment will be 30%.
On the other hand, if you are signed up for the National Health Insurance, you will have to pay your monthly insurance fee to your municipal office, and whether if it is you who is signed up or your family member you will have to pay 30% of the medical fee.
Just by looking at the amount of medical fee you must pay, it seems as though you get better benefits with the Social Insurance, but you would also realize that the monthly insurance fee is more expensive. But there is a reason for that.
As mentioned earlier, the Social Insurance consists of Health Insurance and also Welfare Pension Insurance. You cannot sign up for just one of them. And the reason why the Social Insurance is expensive is that this Welfare Pension Insurance is very expensive. But you get better benefits with the Welfare Pension then the National Insurance. The welfare pension insurance system should provide the worker or the family with pensions and allowances so that they may not be forced to live in want. The welfare pension insurance system comprises pensions for the aged and the disabled because of illness or injury, and for the survivors. While you are well, it may seem that you are just paying expensive insurance fees, but you’ll never know when your insurance will come in handy.
But for those of you who are not planning to stay in Japan for a lifetime may think it maybe a waste to pay the monthly insurance fees, if you are not going to be around in Japan to collect it. Don’t worry; you have a way of recollecting your already paid insurance fees. We have talked about it in our show before so some of you may recall the information if we say “lump-sum withdrawal payment”. This is a system where a foreign employee who had been paying the monthly insurance fees for more than 6 months, can recollect up to 3 years worth of monthly insurance fees, if they apply within 2 years after their departure from Japan.
So it is not always the case that the welfare pension insurance won’t be of any benefit for foreign employees, especially for Permanent Residents. For instance if you were to buy a home in Japan, there is a system called “Welfare Housing Finance”, where you can get a loan to buy your home with a low interest rate, if you have been paying either welfare pension or national pension fees for more than 3 years. The amount of your loan depends on if the house you are planning to buy is an old house or a new one, or the term of your payment of the monthly insurance fees, and the amount of your monthly fees. But mainly you can get a loan to borrow money between 3,500,000yen to 16,000,000yen, and again for a low interest rate, so this should be some good information.
So don’t just judge your monthly insurance fees, just by how expensive the monthly fees are, but think about the benefits you can get, and decide what to do according to how you plan to live your life in Japan.
Last but not least, today’s client wanted to know if there would be any effect on the visa status of the employees in accordance with the Social Insurance. Actually when you apply for a visa extension at the immigration office, you are not asked to hand in documents related to the Social Insurance, or Employment Insurance. But for instance, if there is a need to prove that you are really working at the certain company, the mentioned documents will be needed. Also, if you are planning to apply for the Permanent Status, the Insurance documents will come in handy.
Once again, don’t just judge if the Social Insurance and the Employment Insurance just by the monthly insurance fees, but consider the benefits and your lifestyle for the near future.