Legal News

[Personnel and Labor Relations] The revised Social Insurance Law was officially promulgated by the Diet.

2024/07/04

The revised Social Insurance Law (the “Revised Law”), scheduled to take effect on July 1, 2025, was officially approved by the National Assembly on June 29, 2024. There are several changes to the compulsory social insurance policy, some of which are explained below.

1. limitation of lump-sum social insurance benefits for workers enrolled in compulsory social insurance from July 1, 2025

Under the amended law, workers who join compulsory social insurance before July 1, 2025 are entitled to receive social insurance lump-sum benefits if they (1) have not joined compulsory social insurance for 12 months, (2) have not joined voluntary social insurance, and (3) have paid social insurance contributions for less than 20 years.

On the other hand, workers who join compulsory social insurance on or after the effective date of the revised law (July 1, 2025) are not eligible to receive the social insurance lump sum, except in some special cases, such as those who are of pensionable age but have paid social insurance premiums for less than 20 years, overseas residents, persons with serious illnesses such as cancer, and the severely disabled.

2. Reduction of the minimum period of payment of social insurance premiums to receive monthly pension benefits from 20 to 15 years.

Based on the revised law, workers who have been enrolled in compulsory social insurance for at least 15 years and have reached the age for receiving benefits are eligible to receive pensions. At the time the revised law comes into effect, the eligibility age for receiving benefits will be 61 years and 3 months for men and 56 years and 8 months for women. Thereafter, the eligibility age will be raised in stages, to 62 years for men and 60 years for women in 2028 and 2035, respectively.

The amended law also modifies key provisions such as the rate of pension entitlement for male workers and the salary on which social insurance contributions are based, as well as adding a provision to deal with late or non-payment of social insurance contributions.

Other new aspects of the revised law will be presented in the next newsletter.