What is deemed / fixed overtime pay?
Although fixed overtime (固定残業) pay and deemed overtime (みなし残業) pay are strictly different, they are often used interchangeably even among Japanese people. It can be understood that they are synonymous, especially when written in the terms and conditions of a job offer. *Be sure to reconfirm the conditions before accepting a job offer. In this article, we call it "deemed overtime pay" and explain what it is.
Overtime pay is already included in the monthly salary
The deemed overtime refers to the wage system in which overtime payment for a specified amount of time is already included in the monthly salary. Thus, deemed overtime pay is the payment for the specified amount of time set by the company. Generally, if an employee performs work outside of working hours, the company pays overtime in addition to basic salary. However, if a company has introduced a deemed overtime system, overtime pay for a certain number of hours is already included in the salary, so there is no need to pay overtime separately unless the overtime exceeds a predetermined amount of time.
What is the advantage for the employee?
Even if an employee's overtime hours are less than the deemed overtime hours, the employee will still receive a salary that includes the deemed overtime pay. For example, if the condition is "including 20 hours of deemed overtime pay," the employee will receive a salary that includes 20 hours of deemed overtime pay from 0 to 20 hours of overtime, and any hours over 20 hours of overtime will be paid as additional overtime pay. It can be said that the more efficient the work performance is, the more profitable the system is, and the higher work efficiency leads to employee growth as a result.
It is a part of evolving Japanese working culture
People overseas once viewed Japanese working culture negatively, thinking that "Japanese company employees are not productive, working slowly to earn overtime." However, this view has undergone major changes in the past few years, because many companies are now encouraging more efficient work styles. Deemed overtime work can be considered part of this change.
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