TOKYO, May 25 (News On Japan) - Many employees received their paychecks on May 23rd, but for a growing number, those paychecks now include a portion that used to be paid as bonuses. A new compensation trend is emerging among Japan's major corporations: splitting up bonuses and distributing them as part of monthly salaries.
This shift is drawing attention as both a recruitment tool and a way to provide more stable income amid inflation.
According to the Japanese Trade Union Confederation, the average wage increase during the 2025 spring labor negotiations reached 5.42%, signaling a trend of sustained wage growth. Within this environment, Sony Group and other major firms are revising their compensation systems. One such reform involves incorporating bonus payments into monthly salaries.
Sony introduced the system across three of its core operating companies, covering 15,000 employees. For new hires starting from April 2025, monthly pay has risen by 48,000 yen compared to the previous year, including a 10,000 yen base pay increase. As a result, the traditional biannual bonuses were reduced to a single summer payment.
Sony stated the change was intended to "enhance competitiveness in securing and retaining highly specialized talent" and to foster an environment where people from diverse backgrounds can perform to their fullest. The company has adopted a job-grade system that compensates employees based on their role and performance, without the conventional concept of seniority-based annual raises.
Other corporations are following suit. Daiwa House Industry also restructured its pay system by shifting part of its bonus into monthly wages, resulting in a 10% annual income increase. It raised the starting monthly salary for university graduates to 350,000 yen. The company cited high inflation and the need to stabilize income distribution between salary and bonus as its rationale.
Toy manufacturer Bandai similarly redistributed part of its bonus into monthly pay from fiscal 2022. For 2025, Bandai's starting salary rose to 305,000 yen. In tandem, the company also reformed its salary system for existing and senior employees to enhance overall organizational vitality.
While companies highlight recruitment and income stability as advantages, public opinion remains split. Some employees welcome higher monthly income for its ease in managing household budgets. A man in his 30s said, "It’s easier to manage my expenses monthly. Bonuses go straight to savings or my wife handles them."
Others, however, prefer the traditional bonus structure. A woman in her 20s said, "Without bonuses, it’s harder to afford things like moving or buying new furniture." Another in her 40s noted, "Bonuses clearly reflect performance and come on a predictable semiannual schedule. With salary-based pay, that feedback is diluted."
Commentators also highlighted emotional and motivational factors. TV host Aoi observed that bonuses create a sense of excitement and reward. Commentator Yanagisawa added, "It’s more satisfying when the total income is the same but you get that little extra during bonus season."
However, the new system is not without drawbacks. Toshihiro Nagahama, Chief Economist at Dai-ichi Life Research Institute, pointed out a key issue for companies: "With bonuses, companies can adjust payouts based on performance. Monthly salaries are harder to cut in tough years." He also explained the trade-offs for employees: while steady monthly income helps with financial planning and improves cash flow, it makes saving for big expenses like cars, homes, or trips more difficult. Moreover, if performance-related incentives fade, employees may feel less rewarded for their achievements.
As inflation continues to strain household budgets, the debate over steady income versus large, infrequent payouts will likely grow. How companies revise their compensation systems could shape both workplace morale and financial stability in the years ahead.
Source: FNN
