Japan's Fast Retailing to raise employee pay up to 40% from March 2023

The company has already been advancing this revision in a number of markets where it operates around the world. In Japan especially, where remuneration levels have remained low, the company is significantly increasing the remuneration table, as well as re-examining its HR system, to better enable it to compensate individual employees based on their growth, ambition, and ability to contribute to the business. This will include employees from headquarters and corporate departments responsible for the functions of the company's global headquarters, as well as employees working in stores, the company said in a press release.

Fast Retailing also aims to establish a management that can better remunerate employees so that the resulting growth of individuals and the company will lead to even greater global competitiveness.

The company plans to take this opportunity to match the reality of its flat, highly manoeuvrable management structure. With this in mind, remuneration will comprise such elements as base pay and a bonus determined by performance results for each period, while position-based allowances currently existing in Japan will be eliminated.

As an example of increased remuneration in Japan, the monthly salary of a newly joining university graduate employee will increase from the current 255,000 yen ($1,945.85) to 300,000 yen ($2,290.85), an annual salary increase of approximately 18 per cent. The salary of someone taking on a new role as store manager in their first or second year will increase from 290,000 yen to 390,000 yen (an annual salary increase of approximately 36 per cent). For other employees, the company plans to increase annual salaries by as much as 40 per cent.

Going forward, the new remuneration of each employee will be decided by globally aligned grade criteria. Factors such as work performance and results, ability to contribute to the business, ambition and growth will be defined once again, and a fair grade evaluation will be realised through meticulous performance evaluation from one's supervisor, and a thorough evaluation from upper management and the HR Department.

Prior to this forthcoming revision, the hourly wages of store staff in Japan were already amended in September last year, with the objective of paying appropriate compensation in line with the expectations, responsibilities, and abilities of staff who provide the utmost service to customers.

Additionally, Fast Retailing will reform the way its organisation works, so that the headquarters of each market can cooperate on both a global and local level to develop an organisational structure and workstyle that promotes problem solving.

Fibre2Fashion News Desk (DP)