Social Insurance Agency : Employees’ Pension Insurance

The Employees' Pension Insurance system provides the “earning-related pension" on top of the Basic Pension provided by the National Pension system.

Coverage

	*Compulsory Coverage*

			You must be covered by the Employees’ Pension Insurance system if you are a worker of a company or a factory which employs 5 workers or more or if you are a employee of any HOJIN corporation. You must be covered if you are younger than age 70, irrespective of your nationality or citizenship.

		How to Enroll in the System

			Your employer is responsible for enrolling you in the system by submitting the “Application to Enroll in the Employees’ Health Insurance / Employees’ Pension Insurance” (SHIKAKU SHUTOKU TODOKE - KENKO HOKEN / KOSEI NENKIN) to the Social Insurance Office (including one in a Social Insurance Bureau) within 5 days of your employment.

	*Voluntary Coverage*

			- Voluntary coverage for seniors
				If you are an employee aged 70 or older and have not been covered long enough to be eligible for the old-age benefits such as the Old-age Employees’ Pension or the Old-age Basic Pension, you can voluntarily enroll in the system.

		- Type-4 Insured Person
				This special optional coverage system was intended to allow the people who were born on or before April 1, 1941 and who had 10 years of coverage period by April 1986, to continue to earn more coverage period up to 20 years. This optional application system has discontinued, but there are some existing persons who have been covered under this status.

		How to Enroll in the System

		If you wish to enroll in the system as a voluntarily covered senior, you need to submit the “Application of the Senior Insured Persons for Voluntary Enrollment in the Employees’ Pension Insurance System” (KOSEI NENKIN HOKEN - KOREI NIN-I KANYU HIHOKENSHA SHIKAKU SHUTOKU SHINSEISHO) to the Social Insurance Office (including the one in the Social Insurance Bureau). You need to attach your Pension Handbook. You can enroll until you become eligible for benefits.

Benefits

Old-age Employees’ Pension for age 60-64

If you have one year or more of coverage under the Employees’ Pension Insurance system and if you have enough qualifying period to be eligible for the Old-age Basic Pension under the National Pension system, you can receive the specially provided Old-age Employees’ Pension from the age of 60. However, this pensionable age for the Remuneration-related Portion (See the (b) of following Benefit Amount) of the Old-age Employees’ Pension is being raised according to your date of birth.

Benefit Amount

Annual amount of your specially-
provided Old-age Employees’ Pension = (A) + (B) + (C)
payable between age 60-64

(A) Fixed Amount Portion

\3,143~1,676 * × Number of your covered months × Index rate **

(B) Remuneration-related Portion

((a) + (b)) x Index rate **

(a) =	Your Average Monthly Standard Remuneration ***	×	9.5～7.125/1,000 *	×	Number of your covered　months before March 2003

(b) =	Your Average Monthly Standard Remuneration ****	×	7.308～5.481/1,000 *	×	Number of your covered　months after April 2003

\228,600 for your spouse

\228,600 each for your first and second child

\76,200 each for your third and subsequent children

*	The unit price is \1,676 and it varies depending on your date of birth.
**	In order to sustain the current value of the benefits, the index rate is set in accordance with the fluctuation of the consumer price index. Currently the consumer price index for the preceding calendar year is automatically reflected to the pension benefits staring from April.
***	Average of your Standard Monthly Remunerations before March 2003, reassessed to the current value
****	Total of your remunerations and bonuses after April 2003, reassessed to the current value and divided by the number of your covered months after April 2003.
*****	Payable when you have 20 years of coverage under the Employees’ Pension Insurance system. Payable when your dependent spouse is aged younger than 65, or when your dependent child(ren) is younger than 18 (20 if with certain grade of disability specified by law). Payable for child until first March 31 since his/her 18th birthday.

How to Claim Your Benefit

Old-age Employees’ Pension for age 60-64 and Early Payment of Old-age Basic Pension

If you were born between April 2, 1941 and April 1, 1949 (for women, between April 2, 1946 and April 1, 1954), and if you are eligible for the Old-age Employees’ Pension payable for age 60-64, you may opt for the early payment of the Old-age Basic Pension (either partial or whole amount).

Old-age Employees’ Pension for age 60-64 while you work

While you work, your Old-age Employees' Pension for age 60-64 will be either reduced or suspended if the total of your monthly Pension payable and your monthly remuneration from your work is more than \280,000.

Old-age Employees’ Pension for age 60-64 and Employment Insurance benefits

While you receive the basic allowance of the unemployment benefit provided by the Employment Insurance Law, your Old-age Employee’s Pension for age 60-64 will be suspended. 　
Not only will your remuneration from your work, but also your employment continuation benefits for older workers provided by the Employment Insurance Law affect your Pension.

Old-age Employees' Pension after age 65

You can receive the Old-age Employees’ Pension on top of your Old-age Basic Pension, if you have a coverage period under the Employees’ Pension Insurance system and you are eligible for the Old-age Basic Pension of the National Pension system at the age of 65.

Benefit Amount

Your annual
old-age
pension　
after age 65

Remuneration-
related portion *

Transitional
additional
benefits **

Additional
benefits for your
dependents*

Old-age
Basic
Pension

Same formula as the Old-age Employees' Pension for age 60-64

Equivalent to the difference, if any, between your “Fixed Amount Portion of Old-age Employees’ Pension for age 60-64” and your “Old-age Basic Pension amount”

How to Claim Your Benefit

To claim your benefit, you need to file the “Claim for the Old-age Benefits under the National Pension / Employees’ Pension Insurance” (KOKUMIN NENKIN / KOSEI NENKIN HOKEN - ROREI KYUFU SAITEI SEIKYUSHO) at your nearest Social Insurance Office (including one in a Social Insurance Bureau) or the Pension Consultation Center. You need to attach your Pension Handbook and a certified extract copy of your Family Registry. Please ask at these Offices for the details of your necessary documents of evidence.
If you are already receiving the specially provided “Old-age Employees’ Pension for age 60-64”, you only need to send to the Social Insurance Operation Center a postcard version of the same claim form after you obtain the certification by the Mayer of your Municipality on it. By sending this postcard claim form, you do not need to visit to the Social Insurance Office, and your “pension for age 60-64” will be smoothly replaced by your “pension payable after age 65” when you attain age 65.

Old-age Employees’ Pension after age 65 while you work

While you work, your Old-age Employees' Pension after age 65 will be either reduced or suspended if the total of your monthly Pension payable and your monthly remuneration from your work is more than \480,000.

Disability Employees' Pension and Disability Allowance

You can receive the Disability Basic Pension and Disability Employees’ Pension when you have a certain level of disability: Grade 1 or Grade 2 disability specified by law. To be eligible, you must be covered by the Employees’ Pension Insurance system on the date of your first medical examination on the sickness or injury which caused your disability.
If your disability level is lighter than Grade 1 or 2, you still may be eligible for the Disability Employees’ Pension for the Grade 3 disability or the Disability Allowance.

Benefit Amount

The annual amount of your pension benefits for each level of disability is as follows;

Grade 1 Disability Pension =

( (a) + (b) ) × Index rate × 1.25 +

Additional benefits
for dependent
spouse

Disability
Basic
Pension

Grade 2 Disability Pension =

( (a) + (b) ) × Index rate +

Additional benefits
for dependent
spouse

Disability
Basic
Pension

Grade 3 Disability Employees’ Pension =( (a) + (b) ) × Index rate

(Guaranteed minimum benefit is \596,000)

Disability Allowance (lump-sum payment) = ( (a) + (b) ) × 2

(Guaranteed minimum benefit is \1,191,800)

(a) =

Your Average
Monthly　Standard
Remuneration

× 7.125/1,000 ×

Number of your covered
months before March 2003

(b) =

Your Average
Monthly　Standard
Remuneration

× 5.481/1,000 ×

Number of your covered
months after April 2003

(Note)

When the total number of your covered months is actually less than 300 (25 years), 300 is used as guaranteed minimum.

How to Claim Your Disability Employees’ Pension

To claim your benefit, you need to file the “Claim for the Disability Benefits under the National Pension / Employees’ Pension Insurance / Seaman’s Insurance (KOKUMIN NENKIN / KOSEI NENKIN HOKEN / SEN-IN HOKEN - SHOGAI KYUFU SAITEI SEIKYUSHO) at your nearest Social Insurance Office (including one in a Social Insurance Bureau) or the Pension Consultation Center. You need to attach your Pension Handbook, a certified extract copy of your Family Registry, the certificate of diagnoses issued by your doctor, your X-ray film as well as your report on your medical history and on how your disability affect your livelihood/work. Please contact these Offices for the details of your necessary documents of evidence.

Survivors' Employees' Pension

If a person dies while he/she is covered by the Employees’ Pension Insurance, his/her eligible spouse or child(ren) and other family members who have been financially dependent on the deceased person can receive the Survivors’ Employees’ Pension.
The deceased person’s wife who takes care of his dependent child(ren) or his child(ren) can receive the Survivors’ Employees’ Pension in addition to the Survivors’ Basic Pension paid by the National Pension system.

The benefit is awarded to the following survivors and the priority for payment is the same order:

	(1)	The deceased person’s wife
	(2)	The deceased person’s child(ren) under age 18* (20 if with certain grade of disability specified by law)
	(3)	The deceased person’s husband aged 55 or older
	(4)	The deceased person’s father or mother aged 55 or older
	(5)	The deceased person’s grandchild(ren) under age 18* (20 if with certain grade of disability specified by law)
	(6)	The deceased person’s grandfather or grandmother aged 55 or older
		* The benefit is paid until the first March 31 since his/her 18th birthday.

Benefit Amount

The deceased person’s wife with his child(ren) :

( (a) + (b) ) × 3/4 x index ratio + Survivors’ Basic Pension

The deceased person’s wife without his child(ren) , or other eligible family members:

( (a) + (b) ) × 3/4 x index ratio

(a) =

Your Average
Monthly Standard
Remuneration

× 7.125/1,000 * ×

Number of your covered
months before March 2003

(b) =

Your Average
Monthly Standard
Remuneration

× 5.481/1,000 * ×

Number of your covered
months after April 2003

* The ratio varies according to the deceased person’s date of birth.

(Note)

When the total number of your covered months is actually less than 300 (25 years), 300 is used as guaranteed minimum.

How to Claim Your Survivors’ Employees’ Pension

To claim your benefit, you need to file the “Claim for the Survivors’ Benefits under the National Pension / Employees’ Pension Insurance / Seamen’s Insurance” (KOKUMIN NENKIN / KOSEI NENKIN HOKEN / SEN-IN HOKEN - IZOKU KYUFU SAITEI SEIKYUSHO) at your nearest Social Insurance Office (including one in a Social Insurance Bureau) or the Pension Consultation Center. You need to attach the deceased person’s Pension Handbook, a certified copy of his/her Family Registry and the medical certificate on death issued by the doctor. Please ask at these Offices for the details of your necessary documents of evidence.

Lump-sum Withdrawal Payments (Exclusively for Non-Japanese Citizens)

If you are not a Japanese citizen, you can claim the Payments after you leave Japan. You can claim the Payments if you have not received any pension benefits and you have at least 6 months of coverage under the Employees’ Pension Insurance. You need to apply for it within 2 years after you leave Japan.

Benefit Amount

Your benefit amount formula is as follows, depending on the time of your coverage month. The Payments are subject to tax.

If you have your coverage only in March 2005 or before:

Your benefit amount =

Your Average Standard
Remuneration ***

× Benefit multiplier *

* The benefit multipliers according to your number of months covered

Number of month of your coverage under　 the Employees’ Pension Insurance	Benefit multipliers
6 - 11 months	0.4
12 - 17 months	0.8
18 - 23 months	1.2
24 - 29 months	1.6
30 - 35 months	2.0
36 months and more	2.4

If you have any coverage period in April 2005 or after:

Your benefit amount =

Your Average
Standard
Remuneration ***

1/2 of the
contribution rate
****

Specified
multiplier **

** The specified multipliers according to your number of months covered

Number of month of your coverage under the Employees’ Pension Insurance	Specified multipliers
6 - 11 months	6
12 - 17 months	12
18 - 23 months	18
24 - 29 months	24
30 - 35 months	30
36 months and more	36

*** Your Average Standard Remuneration

If you have the coverage only for and after April 2003

Your Average Standard Remuneration	=	Total amount of your remunerations and bonuses

		Number of your covered months

If you have the coverage only before March 2003

Your Average Standard Remuneration	=	Total amount of your remunerations for/before March 2003 ×1.3	+	Total amount of your remunerations and bonuses for/after April 2003

		Number of your total covered months

****

The contribution rate is changed and determined in every October. If your covered month is between January and August, your contribution rate was determined in October of the second preceding year. If your covered month is between September and December, your contribution rate was determined in October of the previous year.

Application Form

- the form includes information on the Payments in the language of English, Chinese, Korean, Portuguese, Spanish and Indonesian.

Contributions

Your contribution is calculated as below and is shared by you and your employer equally. Your employer is responsible for paying your share of contribution and the employer’s share of contribution to the Social Insurance Office (including one in a Social Insurance Bureau).

Contribution for regular months (without bonus payment)

Contribution amount = Your Standard Monthly Remuneration × Contribution rate *

Contribution for bonus months (regular salary + bonus)

Contribution amount = Your Standard Monthly Remuneration × Contribution rate *

+ Your Standard Bonus Amount (up to \1.5 million) × Contribution rate*

* Contribution rate for each type of coverage status

Type of coverage status	Contribution rate
General insured persons	142.88/1000
Miners and mariners	154.56/1000
Type-4 insured persons	142.88/1000

The rate is as of September 2005. The rate will be raised by 0.354% in every September.

Exemption during your childcare leave
While you take childcare leave, both you and your employer may be exempt from contribution payments upon application.

Type-4 insured persons have to pay the whole contribution: both the insured person’s share and employers share. Their remuneration at the time of retirement is used as their Monthly Standard Remuneration for contribution calculation purposes.

BACK