RESOURCES

Nov 7 2017 How to negotiate salary with Japanese companies?

Even if you think money is not everything, you may still want better salary conditions if possible! But can you really negotiate salary with Japanese companies when you are offered a job? How should you best approach this?

Money may not be everything, BUT you may still want better salary conditions if possible! But can you really negotiate salary with Japanese companies when you receive a job offer? How should you best approach the situation?

Even if it is common in your country to negotiate for salary, in Japan, you have to be careful about it. You want to give a good impression to people you will be working with in the future. Also when negotiating, you have to prepare what you are going to do when you do not get the expected outcome.

Here in this article, we will tell you how salary system works in Japan and a good tip to proceed around salary matter in a peaceful way.

FACTORS TO CONSIDER:

1.) Career level

First things first, Let’s talk about your current experience? Are you a fresh graduate, mid career, or senior in your level? You probably are not surprised with this one. In Japan, your seniority status in career matters.

For the case of bigger established companies and new graduate students…

We would first like to start with bad news. For large established companies, usually salary is decided in very fixed calculation method. For example, each company has established a system to identify the suitable salary such as based on a number of professional work experiences you have, whether you have a bachelor degree or higher degree etc.
For more technical side jobs, such as for IT related jobs, the salary calculation can be more on your technical skills assessment they will do throughout the selection process.
Of course, there can be a very rare exception, but for larger size companies, it is more difficult for you to negotiate for salary. Of course, you can still try and we, as a recruitment firm, see some successful cases (only for the case that the candidates were exceptionally strong and the HR people worked extra hard for exception).

Similarly, for new graduate students (with no professional full-time experience), many of the companies both big established companies and startups, they usually have fixed standard of salary they can offer. Although startups have more flexible salary structure (but they also do not hire new graduates in general). For new graduate students, the salary is slightly different if you are bachelor holder or master/PhD holder.

2.) Length of service within the industry (and sometimes company)

Japan recognizes loyalty and pays attention to experience earned through length of service. Some bigger companies search for candidates in their mid career level who are not considered as job hoppers. In terms of StartUps, they value the length of your industry experience but as long as your reasons are valid for leaving previous companies, it’s not gonna be a problem. This factor affects your salary offer and can work both ways. You can either use it to your advantage or the company can use it against you. So, just always be prepared when asked about your previous career history.

3.) Previous salary earned

So here’s the thing, in Japan you may be sometimes asked regarding your previous salary. This gives the company a rough estimate on how much they should be offering you. This can sometimes be scary for people who lives outside Japan where the currency conversion doesn’t work in their favor. But do not worry because of course the standard of living will be taken into consideration. So just be prepared when they ask you regarding your previous salary.

4.) Your Japanese level

Yes, your Japanese level affects your salary. This of course depends on the job role. Some roles require you to handle outbound and inbound inquiries or processes. And it pays to be bilingual or reach a certain level of Japanese proficiency. Most of the companies in Japan haven’t fully adapted to using English as their medium. In some cases, Global companies hire translators for foreign employees. But since more or less you’ll be dealing with paperworks or colleagues in Japanese, your Japanese level plays a huge part of getting the job position and leveraging your salary.

So…How do you do the negotiation part?

1.) State your expected salary ahead of time

It would be advisable that you state your expected annual salary in your resume. This would also give the company an idea of what you are expecting salary wise. If they still proceeded with your application, it will be easier to bring it up during negotiation that beforehand you already had a number you were aiming for in terms of salary.

2.) Be clear and reasonable when asked why are you aiming for a higher number

Hiring managers understand that Japan is not the cheapest country to live in, but they also do their best to put a competitive offer on the table. If you are aiming for something higher than what is offered you have to be prepared to come up with a reasonable answer. Stating your marital status, number of kids, location, expertise and many more makes a big impact on making your negotiation more reasonable.

3.) Let them know about other offers you have received as well

Sometimes letting companies know that you have offers from other companies, make them even want you more. Especially if they really want to keep you, they will try their best to top of your last offer. Having other job offers to compare also shows that you are a sought after candidate and negotiations must be taken very seriously.

4.) Show them that you are worth the negotiation

Hiring people to join the company is an investment, that’s why you should let them know that you are worth it. Highlight your contribution to your previous companies, how did you help them grow and increase profit and how are you going to do the same or an even better job with this one. Let them know relevant KPI achievements and results of previous projects you have handled!

5.) Look at the other perks and salary package offered

Okay, it might have been difficult to negotiate salary wise BUT the company might have great perks like flexible working hours, extended number of paid and unpaid leaves, great facilities, breakfast or lunch fees, subsidized seminar or personal skill trainings, gym or spa discounts, housing allowances or more. In some positions you can at least negotiate with having some flexibility with work schedule or even remote work.

Is negotiation for the salary really worth it?

Lastly, before you negotiate for the salary, you can question yourself if the negotiation is really worth or not. Meaning are you very firm that you really do not want to work for the company if you don’t get that expected salary? Of course you can always “try” to negotiate to see if it goes well or not…
But usually the company gives offer with the best option they think they can make if they really want to hire you. They are the ones that they are afraid if you are going to accept or reject the offer based on the salary they are proposing.

In case the offer amount is not reaching your expected salary, you can also ask how they work on salary promotion, bonus system, etc… and you can try to do your best to prove that you are really worth for the higher salary or not.
Once you join and you start working in the new work environment, you may change your mind by being surrounded by talented colleagues. Or you will be convinced that you are super high performers. With the valid performance record in your company, you have more bargain power for salary negotiation. (But again for large established companies, the space for salary negotiation may be really limited.)

We hope that above tips are helpful for you to get your dream job in Japan with acceptable salary (if not perfectly expected)! As shown in our other articles, for Japanese companies, there are many “benefits” to look at other than the proposed salary such as job security, good living conditions etc.
For salary negotiation, it is much easier if you are working with recruitment companies. Recruitment companies usually give you good advice about how much salary that you can probably expect, and they usually work hard to do this negotiation process well.

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