The Cabinet Office convened the Children’s Future Strategy Council on June 13, 2023, and adopted the “Children’s Future Strategy.” This article looks into details of the strategy for companies may need to revise their childcare support programs.
[1] Three basic philosophies in strengthening policies on children and childcare
The strategy embraces three basic philosophies.
- Increase young people’s incomes
- Change the overall social structure and people’s awareness
- Provide seamless support for all children and child-rearing households
[2] Acceleration plan and impacts on businesses
Based on the philosophies, the strategy explains about specific measures to be implemented in the coming three years, referred to as “the acceleration plan.” Among them, this section looks at the measures that companies should be aware of.
Measures against so-called “annual income barrier (1.06 million yen, 1.3 million yen)”
Many part-time workers covered by their spouses’ social insurance programs try to keep their annual income within 1.06 yen or 1.3 million yen. This is because earning beyond the thresholds leads to losing dependent family status or having their take-home incomes decrease due to greater premium deduction. To encourage them to work without worrying about the annual income barriers, the government intends to widen insurance coverage for short-time workers, while raising minimum wages. To eliminate the problem of net incomes dropping by earning over 1.06 million yen, the government is also planning to draft a support plan, by the end of this year, including providing companies that make efforts to extend work hours or raise wages with subsidies to cover necessary expenses. Other measures to improve the current system are also under consideration.
Measures to encourage male workers to take childcare leave
The strategy includes amendments to the law for supporting children and families raising children, and extension of the law, which is currently effective until the end of March 2025. The amended law stipulates an action plan for ordinary companies, such as setting of numerical targets or establishment of PDCA cycle, as part of the legal framework. The action plan for ordinary companies includes measures to support male workers’ greater involvement in childrearing, to help them take childcare leave or return to work after leave smoothly, or to consider working hours or places to make it easy to care for children.
Since April 1, 2023, companies with 1,000 or more employees have been required to disclose their male employees’ childcare leave usage rate. The government is planning to expand the system, obliging companies to include the information in their financial statements.
Raising of childcare leave benefit rate
Workers who took childcare leave are provided with childcare leave benefits under the employment insurance program, if they meet certain conditions. Currently, the benefit rate for the first 180 days from the date of leave application is 67% of their wages, and 50% thereafter. The government is planning to increase the rate for the first 28 days to 80%.
By raising the rate to 80%, workers will be able to receive almost full amounts of their net incomes before childcare leave, since childcare leave benefit is nontaxable and workers become exempt from social insurance premiums during childcare leave.
Encouragement of flexible working styles including short-time work
Currently, workers raising children under the age of three may shorten standard work hours to six hours per day under the Childcare and Caregiver Leave Act. Labor authorities are considering additional measures for workers raising children aged three or older who have yet to start elementary school, including short work-hour system, teleworking system, flextime or flexible clock-in, clock-out system, and special leave system. Companies will be required to introduce some of the measures and allow their employees to use them according to their situations. The government is also planning to start a system to provide benefits to workers who have shortened work hours to care for their children. This is aimed to encourage male and female workers to share responsibilities for childrearing and household tasks. Under this program, workers who have adopted short-time work-hour system to care for children under the age of two will be provided benefits to make up for reduced income.
The labor ministry council will discuss details requiring law amendments. Since the changes will affect companies’ childcare support measures, please keep an eye on latest information.
[Reference]
Cabinet Office “Strategy for children’s future (Approved on June 13, 2023)”
kakugikettei_20230613.pdf (cas.go.jp)
The information is based on laws and regulations as of the posting date of the article.
