As minimum wages were increased in October, there must be companies that have raised their employees’ hourly wages during the month.
This article explains about the procedure of revising standardized monthly remuneration used to calculate social insurance premiums in the case wages changed during a month.
The Japan Pension Service provides a collection of examples of administrative procedure for periodical and non-periodical revision in standardized monthly remuneration in its website.
It states “The month in which a full amount of increased/decreased wage is actually paid is considered as the ‘change month,” meaning the month when the change in the amount of fixed monthly salary is reflected in the payment. Wages paid in a three-month period thereafter is used as the calculation base in determining whether the worker’s standardized monthly remuneration needs to be revised.” Even if a worker’s salary was raised in line with an increase in minimum wage, October should not be treated as “the change month,” since the salary paid in October includes hourly wages before the increase. In this case, November should be the “change month.”
The key point is, even if wages changed during a month, the month will not be “the change month” in determining the standardized monthly remuneration. Instead, the following month, when the full amount of the new wage is paid, should be “the change month.”
Another helpful tip
In the case where employees are allowed to commute by car, some companies use a unit gasoline price in calculating commutation allowances by reviewing the price each month. The Japan Pension Service’s examples answers to a question regarding such a case.
Q. In a company that calculates commutation allowance for employees who drive to work by setting a unit gasoline price, if the price is reviewed each month and commutation allowances change as a result, should this be treated as a change in the fixed monthly salary?
A. Even if the commutation allowance changes every month according to the unit gasoline price, it should be treated as a change in fixed monthly salary.
Be sure to include commutation allowances or other necessary items in checking employees subject to change in standardized monthly remuneration.
