Kihonkyu 基本給

Base salary, the monthly figure most other pay is calculated from. Also written kihonkyū, base salary, base pay.

A Japanese salary is usually expressed as a monthly figure, and kihonkyu is the core of it. Above it sit allowances (teate), overtime, and the summer and winter bonuses. In the Ministry of Health, Labour and Welfare's 2020 survey, covering pay for November 2019, average scheduled monthly pay was 319,700 yen, of which base salary was 272,200 yen and allowances 47,500 yen.

At traditional Japanese companies base salary is built from components that reflect the employee rather than the job: a grade-based amount under the ability grading system, sometimes an age or tenure element, and annual increments. Each year it moves through two mechanisms, the regular increment and any across-the-board base-up agreed in the spring wage round. Because the bonus is often set as a number of months of base, and the retirement allowance is commonly calculated from final base salary or a points system tied to it, a rise in kihonkyu carries through to much more than monthly pay. That is one reason Japanese employers have historically preferred to add allowances or one-off payments rather than raise base.

Base salary also anchors several legal calculations. Overtime premiums are calculated on base plus most allowances. The minimum wage test looks at base and most fixed allowances but leaves out family, commuting and attendance allowances, bonuses and overtime.

What it means for a foreign employer

Sources

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General information for employers, not legal advice. Thresholds and dates are checked against the sources listed and dated above; confirm anything you act on with a Japanese employment lawyer or a licensed labour and social security attorney.