mytest
UPDATES ON TWITTER: arudoudebito
Hi Blog. Here we have a case of how NJ can be hurt by careless Immigration decisions. The upcoming requirement for all NJ to be enrolled in health insurance (shakai hoken), or else no visa granted, has been created without necessarily requiring negligent employers to pony up themselves. As usual it’s punishing the powerless. As I wrote on Debito.org last August:
Here’s a good article in the Japan Times describing issues of health insurance and pensions, and how recent revisions clarifying that every resident in Japan (including NJ) must be enrolled may expose the graft that employers have been indulging in (”opting out” of paying mandatory social security fees, encouraging NJ not to pay them, or just preying on their ignorance by not telling them at all) to save money. The problem is, instead of granting an amnesty for those employees who unwittingly did not pay into the system, they’re requiring back payments (for however many years) to enroll or else they get no visa renewal! Once again, it’s the NJ employee who gets punished for the vices of the employer.
Now, according to the FGU, we have a case where the GOJ is seizing a NJ’s assets (not the negligent employer’s) for non-back-payments that the employer should have handled. Read on. A Japan Times article also substantiates this practice of employers fudging working hours to escape paying into NJ health insurance (click here).
A recent Terrie’s Take is also included below for more background information.
Arudou Debito in Sapporo
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City seizes bank account to pay health insurance premiums
General Union.org, Undated, Downloaded early September 2009
http://www.generalunion.org/News/576
An ALT, after having received a letter from city hall demanding two years of back payments forKokumin Kenko Hoken (National Health Insurance), contacted the Fukuoka General Union (FGU).
What was troubling about this case was that until now, the teacher had never had any problems with insurance. His ex-employer, following the law, had enrolled him in Shakai Hoken (Employees Health and Pension Insurance).
The problem started with his new employer, who would not enroll him onto Shakai Hoken. Even though the teacher was required to be at work from 8:30 to 5:00 every day, the company told him that he did not work thirty hours per week and therefore was ineligible for Shakai Hoken. Now the story gets worse.
Not only was the city demanding back payments, but it seized 50,000yen from the teacher’s bank account. Why? Very simple. In Japan, all residents are required to be enrolled in health insurance. Since the employer failed to enroll in Shakai Hoken, the city’s position was that the teacher should be in the city run Kokumin Kenko Hoken system and therefore deducted the money that was owed to them.
The union’s position on payment was different because the union believes that the employer has a duty to enrol in Shakai Hoken. The union officer from FGU told the teacher to make sure that he cleared his bank account immediately after being paid each month. This should have prevented the seizure of more money from the account. But the story’s not over yet.
Finally, the teacher was called into his company’s head office and told that the city would be seizing 130,000yen from his pay. Sorry, the company couldn’t do anything to prevent it; the city has a right to the money. The employer couldn’t see that this could have been prevented if they had honoured the teacher’s right to Shakai Hokenenrolment.
The teacher now still has to pay all his back payments, and for the first time that the union has ever seen, the teacher will not be allowed Kokumin Kenko Hoken coverage until all his back payments are made.
A sign of things to come? Maybe. We wouldn’t recommend that you stick around to see if it’ll happen to you. Talk to your coworkers, join a union, and make sure that you get covered by Shakai Hoken.
ENDS
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More on the issue from Terrie Lloyd:
* * * * * * * * * T E R R I E ‘S T A K E * * * * * * *
A weekly roundup of news & information from Terrie Lloyd.
(http://www.terrie.com)
General Edition Sunday, September 20, 2009 Issue No. 534
+++ WHAT’S NEW
A revision to the immigration law passed in the Diet earlier this year has caused the Ministry of Justice to instruct the Immigration Bureau to start checking that foreigner residents in Japan are enrolled in one of the nation’s health insurance programs. Although not stated explicitly, the implication is that those without such enrollment may be denied a visa renewal. This will start happening from April 1st, 2010 and has a lot of foreigners concerned.
The reason for this concern is that although all residents of Japan, including foreigners, are supposed to be enrolled in one of the health insurance programs, and indeed, in one of the overall social insurance programs, the reality is that many people are not. Most such people are typically either self-employed, contractors, students, part-timers, unemployed people between jobs, or housewives (i.e., all outside the regular employee situation).
We have been following the various media and chat boards about the topic, and the conversations seem to follow three main threads: that the Japanese insurance program is unwanted and unfair to foreigners, that it is discriminatory vis-a-vis Japanese non-payers, and that come April 1st, what can people do about it?
We try to answer some of these questions below.
Most of us know the health insurance program through a collective social insurance package that most private companies are enrolled in, called Shakai Hoken. This refers to health (kenko hoken), pension (kosei nenkin), unemployment (koyo hoken), and nursing (kaigo hoken — for those over 40) insurances. Effectively for most of us, these insurances function as a 16% tax, and result in us getting that much less in our take-home pay packets every month. Our employers also pay out the same 16% to the government as their contribution.
Thus, for those of us on lower-to-medium salaries (say, JPY300,000 a month), while you may think you’re only paying out 20% or so for your payroll taxes (being 10%-12% average for national tax and 10% or so for your local inhabitance tax), in actual fact the real number is more like 38%. If you’re in the higher tax brackets, then this number goes much higher — into the 45%+ range.
As many readers will know, there are four main social insurance programs of which health insurance is part: the Shakai Hoken program which most private companies are subscribed to, the Kokumin Hoken program, which is for people not in regular employment or who are self-employed, private insurance programs which are run by a few major Japanese conglomerates, and a government employee program. For most of us, getting a visa renewal will mean being enrolled in either the Shakai Hoken or Kokumin Hoken programs.
Come April 1st next year, what can you do if you are not currently a contributor to social insurance? We contacted the Immigration Bureau to ask this question, and from what we can tell, they themselves have not yet settled on a policy of how to handle non-compliant people. They did say that they will only be checking for health insurance certificates, not pension and other insurances. So we suppose that the simplest answer is to go get yourself enrolled now in the Kokumin Kenko Hoken program. However, since there are a number of exemption categories for kenko hoken (working in a company of less than 5 people, for example), we suppose it might be possible to present yourself as being an exempt person, with, we think, some chance of being able to convince the interviewing officer that your visa should be renewed.
But is it really worth all the risk and hassle?
So how is it that people have been allowed to get away with not paying in health and other social welfare taxes until now? There doesn’t seem to be an official reason, however, we believe it is because the government for the longest time held that the social insurance package was NOT a tax but rather a benefit, which is why it has not been administrated by the National Tax Agency. This duality of positioning caused the Social Insurance Agency (SIA) to be run differently, and unlike the Tax Agency, has for many decades decided for itself whether to make people pay or not. As we all know, this has changed over the last 5 years, as it came to light that the SIA not only let people off having to pay, but also themselves lost 50MM or so contributor records.
It seems that the new government position is that the SIA once it has been reorganized into a new agency next year, will function more like the National Tax Agency. Indeed, we think that within 5-10 years, the two will be merged, and then the Japanese public will be faced with the reality that Social Insurance really is a tax, not just a pretend one.
So you’re stuck with having to pay at least something. The good news is that if you’re self-employed, a contractor, or a student, you can pay directly to the government, and the rates are not all that unreasonable — certainly the overall cost of social insurance is significantly cheaper than if you’re a regular salaryperson. As a general guide:
* Kokumin Nenkin (National Pension) — JPY14,660/month currently
* Kokumin Kenko Hoken (National Health Insurance) — roughly about 9%. Actual premium is based on your previous year’s taxable income and number of dependents. Annual premiums range up to JPY530,000/year (JPY44,166/month)
* Kaigo Hoken — only paid by those over 40. Levied as portion of previous year’s taxable income, up to JPY90,000/year
Lastly, is the threat of withholding a foreigner’s visa renewal if they don’t pay their social insurance fair? Our guess is that this point may eventually be taken to court by someone caught by the new rule. It is clear that Social Insurance is NOT a tax yet, and in June this year the Nikkei ran an article saying that the Social Insurance Agency had a contributor compliance rate for Japanese citizens for National Pension of just 62.1% (no word on the health rate) — so obviously there are plenty of Japanese not paying in to the system. Yet, we don’t hear of anyone being punished for that. In fact, just the opposite, the Agency allows people who are on low wages to only pay a portion of their obligations, and so the real non-full compliance rate for social insurance is just 45.6%!
Bad luck if you’re a foreigner… you don’t get to choose.
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ENDS
16 comments on “General Union: City govt seizes assets of NJ worker whose employer refused to pay for Shakai Hoken (Terrie’s Take and Japan Times articles too)”
Debito, I blogged earlier today about “Free Choice Foundation” Ronald Kessler’s piece in Japan Times here —> http://wp.me/pAT5P-T2
I just can’t help but conclude that the real issue Free Choice has is that they want to exempt themselves from having to pay in to a program that operates on a sliding scale (people who make more income pay substantially more into the program).
Some of the commentators out there like Terrie Lloyd keep pointing out that program “contributions” aren’t a tax. But the problem is that if it is a mandatory system everyone is supposed to be in (and pay into), it’s academic that the premiums aren’t called a tax. The government has a right to ask for them.
It’s not voluntary, is it? You can’t pick what premium level you want to pay, right?
I fully agree that anyone who should be in Shakai Hoken really ought to have a claim to be in. But I have a problem with these “private” and under-the-table solutions to this.
— Again, my beef is with employers who won’t subscribe their employees properly, and how they’re going unpunished.
There is another Japan Times article on this today, by the way. http://search.japantimes.co.jp/cgi-bin/fl20090929a1.html Jenny Uechi is reporting what the ministry officer’s recent responses have been on this issue.
“Even though the teacher was required to be at work from 8:30 to 5:00 every day, the company told him that he did not work thirty hours per week”
This is another can of worms that needs immediate attention. It’s just a big fat lie that cannot be ignored anymore – 9 to 5, 5 days a week, or anthing approximating that, is a full time job. No ifs or buts.
If you are not enrolled by your employer in Shakai Hoken then deductions will not be made from your salary and you must enroll with the Kokumin Hoken program – that is the law, it is simple, and it is what any half-decent resident, Japanese or non-Japanese, should do. As noted, personal contributions to Kokumin Hoken are less than if it was being taken from your salary as Shakai Hoken. It is absurd for people to claim that it is somehow grossly unfair. The call for an exemption for foriegners is frankly offensive. Many Japanese also work a full week but are not covered by Shakai Hoken – a lot of temp staff and self-employed fit in this category. It is true that some Japanese avoid the system, but many are properly enrolled in Kokumin Hoken and to use this as an arguement to exempt foreigners is implying that two wrongs make a right. I suggest people get properly enrolled and stop trying to circumvent the law. There are plenty of people willing to work/reside in Japan within the law and I actually wish my country was stricter on ensuring that everyone works and resides within the laws of the land.
Perhaps a decent middle ground would be a one time amnesty on back payments for all residents (J or NJ) to at least get people enrolled and paying in once and for all.
I also read the arguement that “my private insurance is better for me”. Nothing in Japanese law prevents you from getting private insurance on top of the government program and there are many insurance providers who offer programs that top-up the Japanese coverage. If you cannot afford to do so then that is tough – just because private coverage suits you, it doesn’t mean that you are entitled to it and can break the law because you could not afford it otherwise.
[egregiously Straw-Man arguments that nobody was making deleted]
I have to agree with M&M – you should be enrolled – it’s a prerequisite of living in Japan. However, and its a big however, if you are working your employer is required to enroll you and pay their share. If they don’t, it’s they who are rorting the system. If the government really wants to clean up the hoken system this needs to be policed – and vigorously, otherwise it is simple more foreigner bashing. If the aim is to shore up the system and get compliance for reasons of social justice, then it needs to be applied to everyone evenly.
— Rorting?
Wikipedia – Rort is a term used in Australia and New Zealand.[1] It is commonly related to politics, or, more generally, a financial impropriety, particularly relating to a government programme. The term was first recorded in 1919 and is a derivative of the older “rorty” a 19th century London slang word—meaning “fine; splendid; jolly; or boisterous”.[2] The term is also used as a verb to mean the action of defrauding, (e.g.: he rorted the system.).
Its really an Australian term more than a kiwi one, but I like it.
rort:
(Australian, New Zealand, transitive) to cheat or defraud
Source: http://en.wiktionary.org/wiki/rort
— Thanks. My new word for the day. What a swizz!
I watched the video you posted earlier this week and agree wholeheartedly when you talked about precedent, and applying to everyone what can be imposed upon the most vulnerable. I see this Hoken issue as the thin edge of the wedge. It would take very little to apply this to Japanese citizens who are behind or otherwise not current with their pension plan payments. Given the kindheartedness of the government penpushers in Japan who have been overheard telling starving citizens to “go away and die*” rather than concede them some welfare money on which to subsist, it would take them very little in the way of compassion to set in place a draconian collection plan to meet their payment goals, and to hell with how that would affect the individual(s) involved.
*(NY Times October 12, 2007, Kitakyushu case where a 52 year old man was found starved to death and mummified in his home.)
“Even though the teacher was required to be at work from 8:30 to 5:00 every day, the company told him that he did not work thirty hours per week”
Some of my schools require me to be there from 8 to 5 but I only considered to be working 5.9 hours a day. Lunch break is 45 minutes long. Where do the 2 plus hours go?
Debito,
Looking over Terrie’s piece, I think he has one or two things wrong.
For one, he seems to confuse the exception in the shakai hoken law for small firms of fewer than five employees. If the firm is UNINCORPORATED and employees fewer than five, then apparently there is an exception to shakai hoken (employer coverage). Which means that workers are thrown into the public (coupon-based) programs.
When I worked on this issue in 2007, the SIA office threw another exception at me, which was that the business supposedly has to be in one of 16 broad industry categories. This rule also excepts certain other occupations (regardless of the actual kind of work you yourself do for the company.)
I brought the whole matter to the attention of Congressman Tom Lantos in California. Lantos was the head of the (U.S.) House Foreign Affairs Committee who had been an outspoken critic of the Yasukuni Shrine visits. Incidentally, Lantos was the only Holocaust survivor in the United States Congress, so he was well informed about right-wingerism in various countries.
The office did not seem to make any progress on the issue, and I heard through channels that Congressman Lantos was very sick (he died in early 2008). My request went to totalization, and whether the U.S. negotiating parties realized the number of exceptions that the Japanese had written into their law.
On the pension enrollment, I am convinced that if the immigration office is saying that no one will have to submit proof of enrollment, it’s simply because they will have other ways of checking. I think people should enroll even if they can’t pay up in full, since the coupon on its face gives you 2 years to catch up. There is no loss to signing up.
Then you have the companies (I know of a few myself) that have 20 or 30 people working in the same office, however, they are broken into separate companies of 4 people each in order to get around the minimum requirements to pay their part.
Excuse me for a momentary diversion but I am a member of the Kyosai Kumiai private schools hoken system.Nobody at my school or their office seems very clued up as to what will happen when I leave my job here.I was told that my contributions will be routed to my superannuation fund in Australia when I leave,but in one of the articles I read it said that that only applied if you work here for less than five years.Does anyone here know the truth?
Thanks
darren_brannan@hotmail.com
now on-topic, I have a friend who is being rorted by a well-known company and his boss has said that that is the case and that he would probably win in a legal tussle but ‘I wouldn’t go there if I were you’ This well-known company is refusing to pay his hoken benefits.It is not a Japanese company either.
@Daz,
Here is the Japan-Australia Totalization Treaty:
http://www.mofa.go.jp/region/asia-paci/australia/agree0702.pdf
If I read it right, your Australian employer has to SEND you into Japan. If they did, then you would be covered by Australia and not Japan for up to five years.
If you were hired IN JAPAN, then you are under the Japanese system. Nothing about time limits.
The Japanese will take your time in here and combine it with whatever you accrue in Ausrralia to determine what you would get for a benefit. For example, if you have 2 years in–in Japan–and need 23 more, your Australian years would count.
The Japanese also offer a deal call Dai Tai Ichi-ji Kin, where they will refund some of the pension amount up to 3 years. This is an older and different thing. It’s not going to your Superannuation, unless you put it in there yourself through contributions. The Japanese government is handing it directly back to you.
My own feeling is that since your country, like Canada, offers a pension benefit based on period of residence, you should keep your credit with the Japanese. The Japanese will certify that you were covered here, so you get credit in Australia. Plus you get the small credit for each number of months you paid in here in Japan, as long as you make 25 years between Australia and here.
That is, unless you feel you will “take the count” before you retire, which is not a good bet. (I hope it’s not, at least.) And maybe some people need to cash out that pension here out of desperation. Then, I don’t know.
I am surprised Japan gives the money back with totalization countries. I can’t figure that one out.
Hoofin,
thanks very much mate!! I am very grateful for that.I have been here for 13 years or so and have only really worked about 2 years back home.
Thanks very much again!