Position allowance 役職手当

A monthly allowance paid for holding a supervisory or managerial post. Also written yakushoku teate, yakuzuke teate, managerial allowance.

When a Japanese employee is promoted to a post such as section chief or department head, the most visible change on the payslip is often a new position allowance rather than a jump in base salary. The amount usually rises with the level of the post and is paid for as long as the person holds it. In the Ministry of Health, Labour and Welfare's 2020 survey, covering pay for November 2019, position allowances were the second most common allowance after commuting, paid by 86.9% of companies, with an average of 41,600 yen a month to those who received one.

The allowance is closely tied to overtime. Managers in a genuine supervisory position are exempt from the overtime rules, so many employers pay a position allowance on promotion and stop paying overtime at the same time. If the "manager" does not have real authority, control over their hours and pay befitting the role, courts treat them as an ordinary employee owed back pay for overtime. The leading example is the McDonald's store manager case decided by the Tokyo District Court in January 2008, which made "nominal managers" a public issue. The size of the allowance is one of the factors courts weigh.

Unlike family, housing and commuting allowances, a position allowance cannot be excluded from the base for calculating overtime, so it raises the overtime rate of anyone who holds a post but is not exempt.

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.