Employees' Pension Insurance Act

The amount of employees' old-age pension is the amount arrived at when the number of months in the insured period is multiplied by an amount equal to 5.481/1000 of the average standardized amount of remuneration for the whole period during which the person was an insured (meaning the number arrived at when the standard monthly remuneration and the standard bonus amounts in each month that constitute a basis for calculation of the insured period are multiplied by the rates provided in the relevant items of the appended table for the category of beneficiary set forth in that item (hereinafter referred to as the "revaluation rate"), and the total is divided by the number of months in the insured period; the same applies hereinafter except for cases in Article 17-6, paragraph (1) and Article 29, paragraph (3) of the Supplementary Provisions).

If a beneficiary is an insured on September 1 of each year (hereinafter in this paragraph referred to as the "base date") (excluding a case where the beneficiary acquires status as an insured on the base date), the period during which the beneficiary was an insured before the month that includes the base date is to be the basis for the calculation of the amount of the employees' old-age pension, and the amount of pension is revised from the month following the month that includes the base date; provided, however, that if the base date falls in the period from the day on which the beneficiary forfeited status as an insured until the day on which the beneficiary again acquires status as an insured, and the period from the day on which the beneficiary forfeited status as an insured until the day on which the beneficiary again acquires status as an insured is one month or less, the period during which the beneficiary was an insured before the month that includes the base date is to be the basis for the calculation of the amount of the employees' old-age pension, and the amount of pension is revised from the month following the month that includes the base date.

If a beneficiary who is an insured forfeits status as an insured and one month passes after the day on which the beneficiary forfeits status as an insured without the beneficiary's becoming an insured, the period during which the beneficiary was insured before the month in which the beneficiary forfeited status as an insured is to be the basis for the calculation of employees' old-age pension, and the amount of pension is revised as of the month that includes the day that is calculated as falling one month after the day on which the beneficiary forfeited that status (or the day falling under one of the items from item (ii) through item (iv) of Article 14, if applicable).

The revaluation rate is revised every year based on the rate arrived at when the rate specified in item (i) (hereinafter referred to as the "price fluctuation rate") is multiplied by the rates prescribed in item (ii) and (iii) (hereinafter the rate so arrived at is referred to as the "rate of fluctuation in nominal net wages"), and applied to insurance benefits in and after April of the relevant fiscal year:

the rate of the price index (meaning the average annual national consumer price index compiled by the Ministry of Internal Affairs and Communications; the same applies hereinafter) for the year prior to the year that includes the first day of the relevant fiscal year, in comparison to the price index for the year two years prior to the year that includes the first day of the relevant fiscal year;

the rate that constitutes the cube root of the quotient arrived at when the rate set forth in (a) is divided by the rate set forth in (b):

the rate of the average standardized amount of remuneration for insureds (meaning an amount calculated as specified by Cabinet Order in consideration of fluctuations in the statistical distribution of gender, age, and standardized monthly amounts of remuneration among insureds as an amount that is equivalent to the amount arrived at when the total standardized monthly amount of remuneration in each fiscal year is divided by the number of insureds in each fiscal year and the resulting quotient is divided by 12; the same applies hereinafter in this item) in the fiscal year two years prior to the relevant fiscal year, in comparison to the average standardized amount of remuneration for insureds in the fiscal year that included the April 1 of the year five years prior to the year that includes the first day of the relevant fiscal year;

the rate of the price index in the year two years prior to the year that includes the first day of the relevant fiscal year, in comparison to the price index in the year five years prior to the year that includes the first day of the relevant fiscal year.

the rate arrived at when the rate set forth in (a) is divided by the rate set forth in (b):

the rate arrived at when a percentage equivalent to one-half of the rate of insurance premiums under the provisions of this Act (hereinafter referred to as the "insurance premium rate") as of September 1 of the year three years prior to the year that includes the first day of the relevant fiscal year is deducted from 0.910;

the rate arrived at when a percentage equivalent to one-half of the insurance premium rate as of September 1 of the year four years prior to the year that includes the first day of the relevant fiscal year is deducted from 0.910.

Notwithstanding the provisions of the preceding paragraph, the rates provided for in the following items are the basis for revision of the revaluation rate set forth in those items:

the revaluation rate for the standardized monthly remuneration for months that fall in the fiscal year preceding the relevant fiscal year (hereinafter referred to as the "standardized remuneration in the previous fiscal year"):the rate set forth in item (iii) of the preceding paragraph (hereinafter referred to as the "rate of fluctuation in the proportion of disposable income");

the revaluation rate for the standardized monthly remuneration for months that fall in the fiscal year two years prior to the relevant fiscal year or for months that fall in the fiscal year that includes the April 1 of the year three years prior to the year that includes the first day of the relevant fiscal year (hereinafter referred to as the "standardized remuneration two or three fiscal years prior"):the rate arrived at when the rate of fluctuation in the proportion of disposable income is multiplied by the price fluctuation rate.

The revaluation rate for the standardized monthly amount of remuneration for months that fall in the relevant fiscal year is established based on the rate arrived at when the rate of fluctuation in the proportion of disposable income is multiplied by the revaluation rate for the standardized monthly amount of remuneration for months that fall in the fiscal year before the relevant fiscal year.

Cabinet Order provides for measures to revise and establish the revaluation rate under the provisions of the preceding three paragraphs.

Notwithstanding the provisions of the preceding Article, the price fluctuation rate (or, if the price fluctuation rate exceeds the rate of fluctuation in nominal net wages, the rate of fluctuation in nominal net wages) is the basis for the revision of the revaluation rate that applies in and after the fiscal year (referred to in Article 43-5 as the "base fiscal year") that includes the April 1 of the calendar year that falls three years after the calendar year which includes the first day of the fiscal year in which the day on which the beneficiary reaches 65 years of age falls (hereinafter referred to as the "post-base fiscal year revaluation rate").

Notwithstanding the provisions of preceding paragraph, the provisions of the items under paragraph (2) of the preceding Article apply to the revision of the post-base fiscal year revaluation rate for the standardized remuneration in the previous fiscal year and the standardized remuneration two or three fiscal years prior.

Cabinet Order provides for measures to revise the post-base fiscal year revaluation rate under the provisions of the preceding two paragraphs.

Notwithstanding the provisions of the preceding two Articles, the rate arrived at when the rate of fluctuation in nominal net wages is multiplied by the rate arrived at when the adjustment rate (meaning the rate arrived at when the rate set forth in item (i) is multiplied by the rate set forth in item (ii) (or 1, if the rate so arrived at exceeds 1); the same applies hereinafter in this Article and the following Article) is multiplied by the special adjustment rate for the year before the fiscal year in question (or the number 1, if the final product is lower than 1; hereinafter in this Article, this final product is referred to as the "calculation rate") is the basis for the revision of the revaluation rate in a term under adjustment:

the rate that constitutes the cube root of the percentage of the number calculated as specified by Cabinet Order as the total number of insureds covered by public pensions (meaning insureds under this Act or the National Pension Act) (hereinafter in this item referred to as the "total number of insureds covered by public pensions") in the fiscal year two years before the relevant fiscal year, in comparison to the total number of insureds covered by public pensions in the fiscal year that includes the April 1 of the calendar year five years before the calendar year in which the first day of the relevant fiscal year falls;

0.997

Notwithstanding the provisions of the preceding paragraph, the rates provided for in the following items are the basis for the revision of the revaluation rates set forth in those items during a term under adjustment:

the revaluation rate for the standardized remuneration in the previous fiscal year: the rate arrived at when the rate set forth in (a) is multiplied by the rate set forth in (b) (or, if the calculation rate is 1, the rate arrived at when the rate that has been arrived at as the product of the foregoing multiplication is multiplied by the rate arrived at when the number 1 is divided by the rate that is arrived at when the rate set forth in (c) is multiplied by the rate set forth in (b)):

the rate of fluctuation in the proportion of disposable income;

the rate arrived at when the adjustment rate is multiplied by the special adjustment rate in the year before the relevant fiscal year;

the rate of fluctuation in nominal net wages;

the revaluation rate for the standardized remuneration two or three fiscal years prior:the rate arrived at when the price fluctuation rate is multiplied by the rate set forth in (a) of the preceding item and in (b) of that item (or, if the calculation rate is 1, the rate arrived at when the rate that has been arrived at as the product of the foregoing multiplication is multiplied by the rate arrived at when the number 1 is divided by the rate that is arrived at when the rate set forth in (c) of that item is multiplied by the rate set forth in (b) of that item).

Notwithstanding the provisions of Article 43-2, paragraph (3), the revaluation rate for the standardized remunerations for months that fall in the relevant fiscal year during a term under adjustment is established based on the rate arrived at when the revaluation rate for the standardized remunerations for months that fell in the fiscal year that preceded the relevant fiscal year is multiplied by the rate set forth in item (i) and the rate set forth in item (ii) (or, if the calculation rate is 1, the rate arrived at when the rate that has been arrived at as the product of the foregoing multiplication is multiplied by the rate arrived at when the number 1 is divided by the rate that is arrived at when the rate set forth in item (iii) is multiplied by the rate set forth in item (ii)):

the rate of fluctuation in the proportion of disposable income;

the rate arrived at when the adjustment rate is multiplied by the special adjustment rate in the year before the relevant fiscal year;

the rate of fluctuation in nominal net wages.

Notwithstanding the provisions of the preceding three paragraphs, the revision or establishment of the revaluation rate in a case in which the rate of fluctuation in nominal net wages is less than 1 during a term under adjustment is subject to the provisions of Article 43-2, paragraphs (1) through (3).

The special adjustment rate referred to in paragraph (1) through paragraph (3) means the rate established pursuant to the provisions of item (i) and revised pursuant to the provisions of item (ii).

the special adjustment rate in fiscal 2017 is 1.

the special adjustment rate is revised every year based on the rate arrived at when the rate that is arrived at when the rate of fluctuation in nominal net wages is multiplied by the adjustment rate is divided by the calculation rate (or, if the rate of fluctuation in nominal net wages is lower than 1, the adjustment rate).

Cabinet Order provides for measures to revise and establish the revaluation rate under the provisions of each of the preceding paragraphs.