The India Employee Benefits Stack for Japanese companies

What changes when you come from Japan

What you call it in Japan, and what it is called in India

There is no health insurance (kenkō hoken) in India. A salaried employee earning more than ₹21,000 a month has no statutory health cover at all, and the shop floor below that line sits in ESI, a government scheme that most Japanese subsidiaries top up on day one. That single gap explains most of the benefits questions a Tokyo HR team asks in its first year in India.

This edition maps every Japanese benefit to its Indian counterpart, in the order your work rules lists them, and then shows what the roughly 1,400 Japanese companies operating in India actually buy for shop floor, staff and expatriate (chūzaiin).

What Japanese companies get wrong when they set up in India

None of these is a knowledge gap. Each is a reflex from home, applied to a country that works differently.

1. 01

   What they assume: Maternity is covered by the insurer, like at home.

   What India doesIn India the employer pays 26 weeks of salary directly under the Maternity Benefit Act. Group health covers the hospital bill only up to a sub-limit, typically ₹50,000 to ₹1 lakh, against an average delivery claim of about ₹1 lakh in Plum's book.

2. 02

   What they assume: Everyone is on statutory health insurance.

   What India doesOnly employees earning up to ₹21,000 a month are, through ESI. Above that line India has no statutory health obligation at all. Group Health Insurance is voluntary in law and what every Japanese subsidiary buys in practice.

3. 03

   What they assume: Our Japan salary structure will work in India.

   What India doesSince 21 November 2025 basic pay must be at least 50% of remuneration. A structure carrying commuting allowance, housing allowance and a large special allowance over a 35% basic is non-compliant and understates EPF and gratuity.

4. 04

   What they assume: retirement allowance (taishokukin) is discretionary, so we can decide later.

   What India doesGratuity is statutory: 15 days of basic per year of service after five years, one year for fixed-term staff. It must be provisioned from the first payroll and is usually insured through a gratuity fund.

5. 05

   What they assume: Life cover matters more than accident cover.

   What India doesOn an Indian shop floor the risk workers and unions price first is accidental injury and disability, and the statutory Employees' Compensation payout is small. Buy Group Personal Accident before Group Term Life.

6. 06

   What they assume: The annual annual health check (kenkō shindan) is mandatory in India too.

   What India doesIt is statutory only for hazardous processes under the Factories Act. For everyone else it is a benefit the employer chooses to buy, usually as an on-site camp once a year.

7. 07

   What they assume: expatriate (chūzaiin) can stay entirely on the Japan plan.

   What India doesA global policy reimburses in yen, later. An India-admitted policy gives cashless admission with no hospital deposit. And without a certificate of coverage under the India–Japan Social Security Agreement, the expatriate is pulled into EPF on full salary.

8. 08

   What they assume: Parents do not need covering; that is the employee's business.

   What India doesParental cover is the most-requested add-on in India and parents account for about 40% of claims by relationship in Plum's data. Global-standard employers cover parents; the India median does not.

Japan vs India, benefit by benefit

Benefit	Japan	India
Statutory health cover	Universal. Employees' Health Insurance for firms with 5+ staff, National Health Insurance for the rest.	ESI for employees earning up to ₹21,000 a month. Nothing above that line.
Employer health premium	About 5% of salary, matched by the employee.	3.25% of wages into ESI below the line. Above it, a voluntary GHI premium of roughly ₹6,000 to ₹25,000 per head a year.
What the patient pays	30% coinsurance with monthly caps.	Nothing at a network hospital under a cashless GHI claim. 100% out of pocket without cover.
Pension	employees' pension (kōsei nenkin) at 18.3% of salary, split equally.	EPF and EPS at 12% employer plus 12% employee on basic pay.
Retirement lump sum	retirement allowance (taishokukin), contractual, funded by the employer's plan.	Gratuity, statutory after five years, 15/26 of a month's basic per year, capped at ₹20 lakh.
Maternity	Paid through health and employment insurance; routine care covered up to about $5,000.	Employer pays 26 weeks of salary. GHI covers the hospital bill up to a sub-limit. No statutory paternity leave.
Paid leave	10 to 20 days, five of which must be taken.	Earned leave of about 15 days plus casual and sick leave, set by state law or the Factories Act.
Annual health check	Mandatory under the Industrial Safety and Health Act, employer-funded.	Statutory only for hazardous factory processes. Otherwise a voluntary benefit.
Accident cover	work-injury insurance (rōsai hoken), statutory, fully employer-funded.	Employees' Compensation Act with low payouts; Group Personal Accident bought voluntarily.
Mental health	Covered at 30% coinsurance; EAPs common.	Inpatient parity required in GHI since 2018; outpatient therapy only with an OPD add-on.
Unemployment insurance	unemployment insurance (koyō hoken), employer pays the larger share.	None. Severance risk sits in notice pay, retrenchment compensation and gratuity.
Long-term care	long-term care insurance from age 40.	None. Employees ask for parental health cover instead.

What MNCs and GCCs offer their teams in India

From The Standard of Employee Benefits 2026–27, Plum's report on 15,312 benefit plans, 5,20,100 claims and 74,543 checkups from Plum's FY26 book.

• 1.6×MNC and GCC benefits spend per employee in India, against a funded Indian startup (nearly 3× a local Indian business).
• 43%of MNCs and GCCs in India are Holistic Leaders: deep insurance plus real breadth of healthcare beside it.
• ₹7,50,000median MNC/GCC sum insured, covering parents or in-laws, with ₹1,00,000 maternity cover and no copays or sub-limits.
• ~2%of payroll buys India's top-quartile plan, against roughly 15% in the US, 10–25% across Europe and 8–15% across APAC.

What headquarters is used to

Japan's statutory layer is broad, so the employer's job at home is mostly topping it up. That is the expectation headquarters brings to India, where the statutory layer is thin.

• 99%+of Japan's population is enrolled in public health insurance
• ≈10%of salary goes to employees' health insurance, split equally between employer and employee
• 30%coinsurance paid at the point of care, with monthly caps
• 29.3%of Japan's population is 65 or older, which shapes what employers fund

Source: Benefits Beyond Borders 2025, Plum's report on benefits in the economies investing in India (Japan chapter, citing the Commonwealth Fund, BMJ Public Health and Japan's Ministry of Health, Labour and Welfare).

Staff seconded from Japan

Expatriate staff usually stay on a global medical policy from Japan, but an India-admitted GHI is still worth adding: it gives cashless access to the hospital network without advance payment and claims paperwork in Japanese. Social security contributions are covered by the India–Japan Social Security Agreement, so a seconded expatriate (chūzaiin) with a certificate of coverage does not pay into EPF.

Where Japanese companies set up in India

Hospital networks, claim costs and state leave rules differ by city. These are the places Japanese companies concentrate.

• Neemrana Japanese Zone

  Rajasthan

  Dedicated Japanese industrial zone on the Delhi–Mumbai corridor with 50-plus Japanese plants. Thin hospital network; plan for a Jaipur or Gurugram tertiary tie-up.

• Manesar–Bawal

  Haryana

  Suzuki, Honda and the auto-component belt. Dense network, high claim costs, strong union expectations on GPA.

• Oragadam and Sriperumbudur

  Tamil Nadu

  Nissan, Yamaha, Komatsu and the Chennai component ecosystem. Tamil Nadu has its own Shops and Establishments leave rules for the office staff.

• Sri City

  Andhra Pradesh

  Isuzu, Kobelco and a growing electronics cluster. Cross-border commuting from Chennai complicates ESI dispensary access.

• Mandal–Bechraji and Sanand

  Gujarat

  Suzuki's Gujarat plant and its suppliers. Lower medical inflation than the metros; Ahmedabad network within an hour.

• Chakan and Talegaon

  Maharashtra

  Bridgestone, Yazaki, and Pune's engineering belt. Pune is one of the seven cities benchmarked in the hub guide.

Japanese companies with operations in India include Maruti Suzuki, Honda Cars India, Toyota Kirloskar, Nissan, Yamaha Motor, Daikin, Hitachi, Panasonic, Sony, Mitsubishi Electric, Denso, Bridgestone, Komatsu, Isuzu.

Everything else applies to every foreign employer

Statutory benefits, group insurance, tax, leave and CTC work the same whichever country you come from. Each part is covered in full in the India guide.

1. Part 1 – Employee BenefitsWhat employee benefits are legally mandatory in India?These are not optional.
2. Part 2 – Group Health InsuranceGroup health insurance for MNCs in IndiaNone of these are legally required.
3. Part 3 – Business Insurance (Non-EB)What business insurance does a new India entity need?This stack is separate from EB and is often the one India-entry teams leave until last.
4. Part 4 – Beyond InsuranceThe benefits your team will actually noticeInsurance is the foundation, not the programme.
5. Part 5 – Setup StageIn what order should a new India entity buy insurance?The most expensive insurance mistake isn't buying the wrong policy.
6. Part 6 – Sector NotesWhat your sector adds to the universal stackThe policies in Parts 1–3 apply to every MNC.
7. Part 7 – City GuideHow do employee benefit benchmarks differ across Indian cities?The same ₹5L GHI plan means different things in different cities.
8. Part 8 – ChecklistThe pre-operations checklistBefore your India entity goes live, each item below should have a policy number, a renewal date, and a named contact.
9. Part 9 – Tax GuideIs group health insurance taxable for employees in India?India runs two parallel income tax regimes simultaneously, and the tax treatment of almost every benefit differs between them.
10. Part 10 – Leave & PoliciesLeave entitlements and what global MNCs typically add on topIndia's statutory leave framework is state-governed and more fragmented than most MNCs expect.
11. Part 11 – Allowances & CTCHow should an MNC structure India CTC under the new labour codes?India's cost-to-company (CTC) structure is more complex than most countries your payroll team has operated in.

Questions Japanese HR teams ask about India

More from Plum for Japanese companies in India

• How MNCs structure health insurance for Indian subsidiariesGlobal programmes, local policies and who signs what.
• Do you need to match headquarters' benefits in India?Where to mirror the parent plan, and where India needs its own design.
• Insurance for expatriate employees in IndiaCovering seconded staff alongside the local plan.
• Group insurance vs ESI: a guide for employersWho must be in ESI, and where group health insurance takes over.
• How to calculate gratuity in IndiaFormulas, worked examples and a free calculator.
• The Standard of Employee Benefits 2026–27Benchmarks from 4,500+ Indian employee health plans.