Fiscal 2023 saw a record increase in minimum wages, prompting the government to establish a scheme to provide companies making efforts to raise wages with financial support. Since the budget for grants and subsidies is limited, companies should apply before it is closed.
[1] Grant for operation improvements
“Grant for Operation Improvements” is a program to cover a part of expenses for equipment investments to small- or medium-sized firms or small-scale entrepreneurs that have raised their minimum wages by at least 30 yen.
The program is applied to companies where the difference between their lowest wage and the region’s minimum wage is 50 yen or less. In the case the region’s minimum wage is 950 yen and a company’s lowest wage is 985 yen, the company may apply for the grant, since the wage difference is less than 50 yen. Based on the new rule set on August 31, 2023, companies with less than 50 employees that have raised their minimum wages between April 1 and December 31 of 2023 may apply for a grant after the wages are increased.
The table below shows the grant rates. The grant has upper limits according to the number of employees whose wages were raised and the amounts of increase.
Grant rates for the expenses
|
Minimum wage in the company |
Grant rate |
|
Less than 900 yen |
9/10 |
|
900 yen or more and less than 950 yen |
4/5 (9/10) |
|
950 yen or more |
3/4 (4/5) |
*The rates in the brackets are applied to companies that satisfy productivity requirements.
[2] Career development grant
The “Career Development Grant” program has several courses, including the “wage rules revision course,” designed to provide a grant to companies that have amended their wage rules to increase base wages for fixed-term employees, etc. by at least 3%. Companies that satisfy all of the following requirements are applicable.
1. Formulate and submit a career development plan
Draw up a career development plan by the day before the wage rules are revised to increase wages and submit the plan to the prefecture’s labor bureau.
2. Application of wage rules
The wage rules include clauses describing fixed-term employees’ base salaries.
3. Wage increase
Fixed-term employees’ base salaries explained above have been increased by at least 3% and increased wages have been paid for six months.
Companies that have raised wages by 3% or more and less than 5% may receive a grant of 50,000 yen per applicable worker (33,000 yen in the case of a large company), and those raised wages by 5% or more can receive 65,000 yen per worker (43,000 yen for a large company.) Companies may apply for the grant for up to 100 employees per workplace in a fiscal year.
[3] Company rebuilding subsidy
“Company Rebuilding Subsidy” scheme has a category for minimum wage increase. Subsidies are granted to small- and medium-sized firms facing difficulty in securing fund for raising minimum wages according to the regional standard.
Subsidy rate is three-fourth for small- and medium-sized companies and two-thirds for larger enterprises. Upper limit is set according to the number of employees. Applications are accepted during a specific period. Please check the latest information for detailed requirements.
Companies applying for Manufacturing/Commerce/Services Subsidy or for IT Introduction Subsidy will be given additional points, if “the minimum wage in the company is at least 50 yen higher than the region’s minimum wage.”
There are many other requirements for businesses applying for grants and subsidies. Please check details before making an application.
[Reference]
Labor Ministry
“Support for minimum wage increase has been strengthened”
https://www.chusho.meti.go.jp/koukai/yosan/r4/r4_chinage.pdf
“Business improvement grant”
“Career development grant”
https://www.mhlw.go.jp/stf/seisakunitsuite/bunya/koyou_roudou/part_haken/jigyounushi/career.html
Organization for Small & Medium Enterprises and Regional Innovation, “Business rebuilding subsidy”
https://jigyou-saikouchiku.go.jp/
*The contents are based on laws and regulations as of the date of this article.
