COMPENSATION MANAGEMENT IN JAPAN

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Presented By: Raveena Kapoor Reema Gupta Richa Srivastava Rohit Pal Rishabh Bishnoi Shikha Durgavanshi Srishti Kumari Singh Swati Prakash

Culture
In terms of professionalism Japanese portray an ideal picture. Punctuality Believe in rendering quality Service

Build a Supportive workplace environment.

Loyalty Appreciate and render help when needed by colleagues. Always Ready to Adapt and Innovate.

Philosophy
Japanese Begin any business process by exchanging business cards. They emphasize on being dressed formally during a business meeting. Low inter Company mobility in employees. Employee welfare is very much emphasized. A systematic work culture. Consider experience reliable for better performance. Compensation planned as per seniority and not on efficiency.

How Japan is different from the rest?

Effectiveness preferred over efficiency Prefer being a quality producer than quantity.

Adapts changes
Always ready to innovate. Loyalty high amongst employees for their organization.

Components of Presentation
Compensation System in Japan Employment Policies Wage system And Promotion System

Labor Unions
Conclusion

Compensation System
Employee Cost
Compensation besides cash wage unplanned Monthly wage Planned Allowances Cash wage Cash wage

Annual bonus

Basic wage

I.Employee pension i.Legal welfare expenses II.Unemployment insurance III.Health insurance ii.Non legal welfare expenses iii.Retirement payment Housing a.housing

Compensation besides cash wage

iv.Recruiting expenses
v.Educational training expenses

b.meals

c.Health Insurance d.Property fund

e. Culture physical & recreational f. Private insurance system

g. Employee accident premium

h. Money gifts for congratulations

Wage System
There are three elements linked in long-term mutual commitment On the Job Training:- Through this training workers acquire their professional skills. Systematic Job Rotation:- In this every worker assigned to new job/location after every three or four years.

Career Plan:- Through this an organization encourage their workers for the long term
commitment towards the organization. Seniority based wage system Nenko Jorestu is also an expression for the long term career training. Wages rises automatically with age and seniority. Under this system workers are given annual wages increases independent what they actually do on the job.

Wage Scale and Promotional System

In Japan, each company has its own wage scale and promotional system, however there are common

elements because they have to meet the workers expectations and customary practices.
The wage policies of each companies emphasize the importance of wage factors, or the bonus system. Some factors that determine the Wages In Japan are: Bargaining power of Unions Seniority and education Prevailing Pay

Wage Scale and Promotional System

Promotional System: Japanese companies follow a system named Nenko Jorestu, in this system job position and salary increases in accordance with age and length of the service. Japanese companies have operated it in dependence upon personnel evaluation consisting of competence, performance and affecting appraisal. This system makes it possible to set a wage curve that keeps pace with outlays that increase with age.

Wage Determination
Japanese Trade Union Federation, known as Rengo The leaders of Rengo sit opposite the Japan Business Federation, every spring and negotiate the annual wage hikes across the various fields of Japanese industry. Unified Collective Bargaining of wages moved towards enterprise based unions(belonging to an industrial federation) where joint consultation is preferred for solving most issues. No direct participation of industrial unions or national federations in wage negotiation.

 Labour unions are organised at the level of individual companies.

Collective bargaining can be classified as moderate and limited to some big companies.
ORGANISATION
TOYOTA NEC HITACHI
Each firm has its own wage policy.

LABOUR UNION
Toyota workers Union NEC workers Union HITACHI workers Union

Its management discretion to decide the manner in which wages are distributed. -Age - Length of the service - Ability

Wage Differentials
Enterprise size

Class of position
Education

Age group
Length of service On the basis of skill

Wage Negotiation
In Japanese companies the amounts of pay increases are determined by collective bargaining. The amount of bonuses is determined through negotiation between labour and employers For companies without trade unions, the wage negotiation results from the industries and business types similar to them will be their benchmark.

In Japan, white-collar and blue-collar worker, are managed under the same system HRM,
regardless of job type;

Not much wage differences between both. In Japan, wages are given on the basis of (age skill) rank system. The amount of bonuses is also determined through negotiation between labour and employers. Bonuses are paid twice a year.