Working with Japan

Hiring in Japan

Employer of Record in Japan: What It Costs and What to Compare

By a Japan-qualified lawyer ·

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This article is general information about how things usually work in Japan. It is not legal advice, does not create a lawyer–client relationship, and may not reflect the latest changes. For your specific situation, consult a qualified professional.

An employer of record (EOR) lets you hire someone in Japan without setting up a Japanese company. The EOR becomes the legal employer, runs payroll and social insurance, and invoices you; you manage the person’s day-to-day work.

Most comparisons of EOR providers are written by EOR providers. This one isn’t. I’m a Japan-qualified lawyer, and I’ve read and worked with contracts where the legal employer and the place someone actually works are different — dispatch, outsourcing and similar arrangements. Below is what the published prices are, what usually sits on top of them, and the questions I’d want answered before choosing a provider for Japan.

Prices and terms below were checked on October 13, 2026, on each provider’s own pricing page. They change, so treat them as a starting point and get a written quote.

Published EOR prices for Japan

Provider Published EOR price Notes on the pricing page
Deel $599 per employee per month Month-to-month; no long-term commitment stated
Remote From $599 per employee per month “Starting at” pricing
Oyster $699 per employee per month Annual discounts available; refundable deposit required; setup, onboarding and terminations stated as included
Multiplier From $459 (annual) / $499 (monthly) per employee per month Compliance-mandated add-ons and implementation fees charged separately

These are global list prices, not Japan-specific quotes. In practice, most providers price per country after a sales conversation, so the number you are offered for Japan may differ.

What the EOR fee does not include

The EOR fee is generally charged on top of:

  • Salary, including any bonuses you agree to.
  • Employer social insurance and labour insurance contributions. In 2026 these add roughly 12–16% to salary for a typical full-time employee in Tokyo. I break them down item by item, with worked examples, in The True Cost of Employing Someone in Japan.
  • Allowances and benefits you choose or are expected to offer, such as commuting allowance.

Depending on the provider, you may also see:

  • A refundable deposit. Oyster’s pricing page states that one is required; ask other providers whether they require one and how it is calculated.
  • Setup, onboarding or offboarding fees.
  • Currency conversion costs if you pay in a currency other than the one on your invoice.
  • Add-ons for things like visa support, equipment or extra benefits.

A worked example

Using the figures from the cost article: an employee in Tokyo on ¥8,000,000 a year costs about ¥9.24 million once employer contributions are included. Add an EOR fee of $599 a month — about $7,200 a year, or roughly ¥1.08 million at ¥150 to the dollar — and the all-in annual cost is in the region of ¥10.3 million, before bonuses, allowances, deposits and any extra fees.

Six questions to ask any EOR about Japan

Price is the easy part to compare. These are the questions that separate providers for Japan specifically.

Ask whether the provider employs people in Japan through its own Japanese entity or through a local partner. Some providers say on their Japan pages that they own their entity there; others work through partners. Neither is automatically better, but you should know which company signs the employment contract, holds the payroll registration and handles social insurance — and who you deal with if something goes wrong.

2. How does the arrangement fit Japan’s worker dispatch rules?

This is the question I’d put first, and it is rarely discussed in providers’ marketing.

As a general matter, Japanese law restricts arrangements where a company’s employee works under the direction of a different company. Such arrangements are generally regulated as “worker dispatch” under the Worker Dispatch Act, which requires a government licence for dispatching businesses. It also generally limits how long the same dispatched worker can work in the same unit of the client organisation — in principle, three years.

An EOR arrangement, where you direct someone’s work while the EOR is the legal employer, can look very similar. I won’t give a view on how any particular provider is structured. But I would ask each provider:

  • How is your Japan arrangement structured under Japanese law?
  • Do you, or your local partner, hold a worker dispatch licence in Japan?
  • Does any time limit apply to the same person working for us through you?

Licensed dispatch businesses can be searched on the Ministry of Health, Labour and Welfare’s Human Resource Services site (in Japanese). If a time limit could apply, it matters for your plans: it may affect when you need your own entity.

3. How are terminations handled — and what do they cost?

When I review English offer letters and employment contracts prepared overseas for roles in Japan, the termination provisions are the part I most often find too loose. Drafts tend to assume the employer can end employment more freely than Japanese law generally allows.

In general terms, Japan requires advance notice of dismissal (or payment in lieu), and a dismissal that lacks objectively reasonable grounds and is not considered socially appropriate can be held invalid. In practice, many separations are handled by agreement.

Ask the provider:

  • Who decides, and who handles the process, if you want to end the employment?
  • Are separation payments passed through to you, and are there offboarding fees?
  • What termination wording goes into the Japanese employment contract?

4. Is the employment contract in Japanese and English, and which version prevails?

Ask to see the template employment contract and the work rules (shugyo kisoku) that will apply. You want to know what the employee is actually agreeing to, in both languages.

5. How are bonuses, allowances and annual leave handled?

Japanese salary packages often include twice-yearly bonuses and a commuting allowance. Check how the provider sets these up in payroll, how social insurance is applied to them, and how paid annual leave is tracked.

6. Can the provider support a work visa, if you need one?

If the person you want to hire needs a visa to work in Japan, ask whether the provider can act as the sponsoring employer, what it costs, and how long it usually takes. Not every provider offers this in every case.

When an EOR makes sense — and when it doesn’t

An EOR is generally a good fit when you are hiring one or a few people in Japan, testing the market, or need someone to start before you could set up a company.

It becomes harder to justify as headcount grows. At around $600–$700 per person per month, the fees add up, and if a time limit applies to the same person working through the provider, a long-term team may need your own Japanese entity anyway. I’ll compare the routes in more detail in a separate guide on entity vs EOR vs contractor.

Key points

  • Published EOR list prices for the major providers ranged from about $459 to $699 per employee per month (checked October 13, 2026).
  • The fee sits on top of salary and employer contributions, which add roughly 12–16% in Tokyo in 2026.
  • Ask about deposits, setup and offboarding fees, currency costs and add-ons.
  • For Japan, ask who the legal employer is, how the arrangement fits the worker dispatch rules, and how terminations are handled.
  • Get a written quote for Japan that separates the EOR fee from statutory costs.

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