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NO:006Rules on Japanese Salary

4 Methods of Salary Calculation

In Japan, mainly these 4 methods are used to calculate salary.
(1):Hourly Pay System
Hourly wages are the amount of pay you can get per hour. Multiplying
the hourly rate by the number of hours you work determines your salary.
For example, if your hourly rate is 1000 yen and you work 40 hours a week, your salary for the week is calculated as follows:
1000 yen × 40 hours = 40,000 yen.

(2):Day Pay System
This is a fixed amount of pay you can get for working for each day.
For example, if your daily rate is 10,000 yen and you work 20 days in a month, your salary for the month is calculated as follows:
10,000 yen × 20 days = 200,000 yen.

(3):Monthly Pay System
This is a fixed amount you get for working each month. Under Monthly Pay System employees will be paid the same amount even if a certain month has few or many holidays, or the employee takes few or many sick days.
200,000 yen × 1 month = 200,000 yen.

(4):Daily Basis Monthly Pay System
This is combines Day Pay and Monthly Pay Systems. Many companies in Japan use this system. Although you get a fixed amount per month, if you take days off due to sickness or other reasons, your salary will be lower depending on how many days you take off. For example, if you normally get 200,000 yen per month (20 working days) and are absent for 3 days due to illness, your salary will be calculated as follows:
Daily rate = 200,000 yen / 20 days = 10,000 yen
Payment with 3 days absence = 200,000 - (10,000 yen × 3 days) = 170,000 yen.

What is a closing Date / Payday?
The closing date is the last date of a pay period. Payday is usually 10~15 days following the closing date in order to process payroll and deposit payment into employee's bank account.