What should a sole proprietor do after hiring their first employee? The four major insurances vary depending on whether the employee is for daily use or business use, but the individual business owner also varies.
The 4 major insurance differences according to the presence or absence of employees of individual business owners
We have summarized in a table how the four major insurance coverage differs by business operator and worker.
From a business operator's point of view, whether or not to purchase the four major insurances is different depending on whether or not there are employees. There are two types of sole proprietorships: simplified taxation and general taxation, which are classified according to the taxation type and have nothing to do with the four major insurances.
|1 individual entrepreneur
||Sole proprietorship with employees
||Workers (less than 1 month per day)
||Workplace (workplace) subscribers (Approximately 7.35% of monthly remuneration pays in full)
||Workplace (business) subscribers (Approximately 7.35% of monthly remuneration is borne by the employer and half)
||9% of your income is covered by yourself
||9% of monthly income is fully paid by the person, aged 18 to 60
||9% of monthly income is borne by the business operator and half
||X (can join if desired
||1.6% of the average monthly remuneration is paid by the business operator and half (family employees are not obligated to join)
|industrial accident insurance
||X (can join if desired
||Fully borne by the business (family employees are not obligated to join)
4 major insurances for businesses and workers
A sole proprietorship can become a workplace (workplace) subscriber if there is at least one regular employee.
If there is more than one full-time employee, the employer's health insurance is the employer (workplace) subscriber. It does not change automatically and must be reported. There is no difference in the national pension for business owners, and it is not compulsory to subscribe to employment insurance and industrial accident insurance.
Sole proprietors are not obligated to purchase employment insurance and industrial accident insurance
You can join if you wish.
Businesses must pay half of the health insurance premium, national pension, and employment insurance for regular workers.
Employers must pay half of the worker's health insurance premium and the national pension.
Family employees are not required to purchase employment insurance and workers' compensation insurance.
Unlike other employees, spouses and relatives living together are excluded from the scope of the Labor Standards Act. According to social norms, they are not considered workers under the Civil Act because they share a livelihood with a business owner.
Principle of family employee employee status
When relatives and ordinary workers living together at the workplace work together, it is difficult to understand the wage and employment status, and in social norms, it can be seen that they share a livelihood with the employer, so, in principle, they are not considered workers.
That is, in the case of spouses, lineal ascendants and descendants, and their spouses under the Civil Act, in principle, workers' status is not recognized.
However, in the case of claiming to be an employee, the employer is given the burden of proof to submit the necessary data to confirm the employment relationship, thereby determining the employee's identity.
If you are recognized as an employee, you can sign up for industrial accident/employment insurance and provide insurance benefits.
What is a living relative?
Spouses in the Civil Act who share the same household, blood relatives within the 8th degree, and relatives within the 4th degree.
Whether to live together is judged through a copy of resident registration (abstract) and the family relationship register.
In the case of proof of worker status with relatives living together
Even relatives living together can be recognized as a worker by submitting the necessary data to confirm the employment relationship. (source)
In the case of relatives living together, such as spouses, the employer-subordinate relationship cannot be easily recognized, the formal distinction between workers and employers is difficult, and the Labor Standards Act reflects the fact that it is undesirable for the state to intervene in family relationships by law. If only relatives are employed, the Labor Standards Act is not applicable.
What individual entrepreneurs should do after hiring their first employee
In terms of the four major insurances, it was found that sole proprietorships differ according to the presence or absence of employees. If there is more than one employee, it becomes a workplace in terms of the four major insurances. In health insurance, the employee insured as we know it is a business insured in this term.
Therefore, after hiring full-time employees, the establishment of a business establishment must be reported to the four major insurance corporations, and the business operator and employees must be registered and reported to each insurance corporation.
- Business establishment report
- Report on acquisition of 4 major insurance qualifications
The establishment of a business establishment must be reported to each industrial complex, but there is a way to apply online at once in one place.
4 major social insurance information centerYou can use
Report the establishment of a business establishment (when hiring the first employee)
When hiring the first employee Report on establishment of businessshould do
You only need to report the establishment of a business establishment once when hiring the first employee.
Report on acquisition of 4 major insurance qualifications
After reporting the establishment of the business establishment, you must report the acquisition of four major insurance qualifications.
If you have hired your first employee, register yourself and your employees. You must report the acquisition of the 14 major insurances within 4 days from the date of employment.
In this case, the salary of the representative must be equal to or higher than that of the highest-paid employee.
Every time a new employee is hired, he/she must report the acquisition of qualifications, and when he resigns, he must report the loss.
In case of adding a dependent, the additional dependent must be reported, and when the salary is changed, the remuneration supplement must be reported.