Since 16 October 2025, employing at least one full-time worker is not optional for the Business Manager Visa. It used to be an alternative to the capital test; now you need the capital and the employee.
That turns a hiring decision into a visa requirement, and it is the part of the reform founders budget for least accurately. This guide covers who counts, what it costs, and what you are legally on the hook for once someone is on your payroll.
Who counts as the employee
The person must be working full-time and residing in Japan, and — this is the part that trips people — they must hold a status of residence that permits the work you are hiring them for.
In practice that means one of two things:
- A status based on personal circumstances — permanent resident, spouse or child of a Japanese national, spouse or child of a permanent resident, or long-term resident. These carry no restriction on the type of work, which makes them the simplest hires.
- Japanese nationals and special permanent residents, who are not a residence-status question at all.
An ordinary work visa does not count for this requirement. The Immigration Services Agency states it plainly: the employee must be a Japanese national, a special permanent resident, or hold a Table 2 status. A holder of a Table 1 status — Engineer / Specialist in Humanities and the other work categories — is excluded, however suitable they are for the job. This is the point most guides get wrong, and hiring on it costs you a salary and the application.
A student on a part-time work permission does not satisfy a full-time employment requirement either. Nor does a contractor you pay by invoice — the requirement is employment.
The overlap worth planning around
The reform also introduced a Japanese language requirement at CEFR B2 / JLPT N2, satisfied by either the applicant or a full-time employee. If you do not have N2-level Japanese yourself, your first hire can carry that requirement for the whole application.
Which means this one hire may be doing three jobs at once: the work you need done, the employee requirement, and the language requirement. Hire accordingly — see the October 2025 rules for how the tests interact.
What it actually costs
The salary is the number founders quote. It is not the number that matters.
The floor
Tokyo’s minimum wage rose to JPY 1,226 per hour on 3 October 2025 — a 5.42% increase, the largest in recent years, and the highest rate in Japan. Kanagawa is JPY 1,225 and Osaka JPY 1,177.
At Tokyo’s minimum for a standard full-time month, that is roughly JPY 200,000 in gross salary before you have added anything. And minimum wage is a floor, not a market rate: for a bilingual employee capable of carrying the N2 requirement, you are competing in a much higher band.
Worth planning for: the Tokyo rate is expected to move again in the autumn 2026 revision, with commentary pointing at around JPY 1,300.
The employer’s share on top
Social and labour insurance in Japan is split with the employer, and the employer’s half is a real cost that sits on top of gross salary.
| Contribution | Total rate | Employer’s share |
|---|---|---|
| Employees’ pension insurance | 18.30% | 9.15% |
| Health insurance (Tokyo) | 9.85% | about half |
| Long-term care insurance (ages 40–64) | 1.62% | about half |
| Employment insurance | — | 0.95% of gross wages |
| Child and childcare support (from April 2026) | 0.23% | 0.115% |
Taken together, employer contributions typically add around 15–17% on top of gross salary, with the overall employer burden usually landing in the 14–18% range.
So a JPY 300,000 monthly salary is roughly JPY 345,000–350,000 of monthly cost, or somewhere near JPY 4.2 million a year (roughly USD 27,000) before recruitment, equipment or anything else. Pension contributions are calculated on standard monthly remuneration capped at JPY 650,000, which limits the cost at higher salaries but not at the level most first hires sit.
What you take on as an employer
Hiring in Japan is not a payment arrangement. It attaches obligations from day one:
- Enrolling in social insurance. Companies must enrol eligible employees in health insurance and employees’ pension. This is not optional for a corporation. The company itself is covered from incorporation, whatever its headcount, and the notification clock is five days — see social insurance and the mandatory employee.
- Labour insurance. Workers’ accident compensation and employment insurance, filed separately.
- Payroll withholding. Income tax and resident tax withheld and remitted on schedule.
- Year-end adjustment. The annual reconciliation done through payroll rather than by the employee.
- Employment rules and contracts that comply with Japanese labour law, which is markedly more protective of employees than most founders expect — dismissal in particular is difficult.
These are the mechanics a sharoushi (labour and social security attorney) or a payroll provider handles. Several firms in our directory list payroll among their services, including TOMA Consultants Group, Nagamine & Mishima, Kreston ProWorks, Venture Japan and Forvis Mazars. Venture Japan publishes accounting from JPY 35,000 a month; most others quote on request.
Sequencing, and the trap in it
Here is the circularity nobody warns you about. The visa requires an employee. The employee requires a company that can run payroll. Payroll requires a corporate bank account. And the bank account is often the slowest step of all.
A workable order:
- Incorporate.
- Start the bank account application immediately — it is the long pole.
- Engage a payroll provider or sharoushi before the first hire, not after.
- Hire, enrol in social and labour insurance, run the first payroll.
- File the visa application with the employment actually in place.
Founders who leave the hire until the visa paperwork demands it discover they cannot pay the person they just hired.
Free help that exists
Worth knowing about because it costs nothing: JETRO, the government’s trade and investment organisation, runs the Invest Japan Business Support Center for foreign companies establishing a base in Japan, along with an Experts Finder directory of professionals serving foreign businesses. Its published material does not state which services are free or in which languages, so ask — but a government body with a mandate to attract foreign investment is a reasonable first call before you are paying anyone.
Questions to ask before you hire
- Does this candidate’s status of residence permit the work I am hiring for?
- If I am relying on them for the N2 language requirement, can they evidence it?
- Who is running payroll and the social insurance enrolments — and from what date?
- What is the fully loaded monthly cost, not the salary?
Our directory records which firms handle payroll and which handle the visa, with the date each listing was checked. As always, this is a summary of general practice rather than advice on your situation — employment and immigration law are both areas where the specifics decide the outcome.
Frequently Asked Questions
Does the Business Manager Visa require me to hire someone?
Yes, since 16 October 2025. Employing at least one full-time worker used to be an alternative to the capital test; now you need the capital and the employee. That turns a hiring decision into a visa requirement.
Who counts as the full-time employee?
Someone working full-time, residing in Japan, and holding a status of residence that permits the work. In practice that means either a status based on personal circumstances — permanent resident, spouse or child of a Japanese national or permanent resident, or long-term resident, none of which restrict the type of work — or an appropriate work visa for the role. A student on part-time work permission does not qualify, and neither does a contractor you pay by invoice.
Can my employee satisfy the Japanese language requirement for me?
Yes. The CEFR B2 / JLPT N2 requirement can be met by either the applicant or a full-time employee. If you do not have N2-level Japanese yourself, your first hire can carry it for the whole application — which means that one person may be doing three jobs at once: the work, the employee requirement and the language requirement.
What does an employee actually cost in Japan?
More than the salary. Employer social and labour insurance contributions add roughly 15–17% on top of gross pay, with the total employer burden usually landing in the 14–18% range. A JPY 300,000 monthly salary is therefore around JPY 345,000–350,000 of monthly cost, or near JPY 4.2 million a year before recruitment or equipment.
What is the minimum wage in Tokyo?
JPY 1,226 per hour from 3 October 2025, a 5.42% increase and the highest rate in Japan. Kanagawa is JPY 1,225 and Osaka JPY 1,177. For a standard full-time month that is roughly JPY 200,000 gross — but minimum wage is a floor, not a market rate, and a bilingual employee capable of carrying the N2 requirement competes in a much higher band.
What order should I do this in?
There is a circularity: the visa requires an employee, the employee requires payroll, and payroll requires a corporate bank account, which is often the slowest step of all. A workable order is incorporate, start the bank account application immediately, engage a payroll provider or sharoushi before the first hire, hire and enrol in social and labour insurance, then file the visa application with the employment actually in place.