Japan abolishes income threshold for part-time social insurance

Japan has abolished the monthly wage requirement of 88,000 yen (approximately 1.06 million yen annually) for part-time workers to join social insurance. Under the new rules effective October 2024, eligibility for health insurance and employees' pension insurance will primarily depend on working hours rather than income levels.

Currently, workers at companies with 51 or more employees who work at least 20 hours per week are subject to mandatory enrollment regardless of their income. The threshold for company size is set to be gradually reduced: to companies with over 35 employees in October 2027, over 20 in 2029, over 10 in 2032, and the requirement will be fully abolished by October 2035.

While the change may reduce take-home pay due to insurance premium deductions, it offers expanded benefits, including increased future pension amounts and coverage for injury or childbirth allowances. The reform aims to eliminate “work suppression,” where employees limit hours to stay below income thresholds. However, the “1.3 million yen wall” for dependents remains unchanged for now.