In Japan, few historical researches on the pay structure in Japanese companies have been systematically implemented. The pay structure has been continuously changed. The seniority, in Japan, has been a key factor to decide the pay structure, but the number of companies adopting the performance -based pay structure such as annual salary system is steadily increasing. In other words, there is a tendency that companies substitute their seniority -based pay structure, increasing base pay according to the employee`s educational attainment, length of service or age, for performance-based pay structure, increasing base pay according to the employee`s competence and performance. Since the mid-1980s a number of companies have reduced or eliminated the seniority-based pay. Particularly since the mid-1990s a number of companies have not only reduced or eliminated the skill-based pay system but also adopted the annual salary system, the job-based pay system & pay structure by job classification. Under this circumstance, the primary purpose of this research is to give a tip for Japanese companies and academia who want to improve their pay structure by systemizing the change and its characteristics of pay structures in Japanese companies through the review on previous researches, statistical data and case study. Surely, this research could present companies in need with strategies and tactics to improve their pay structures by studying how the pay structure has been changed according to circumstance and managerial situation. Major characteristics of the changes of pay structures are as follows: first, performance-based pay structure such as annual base pay, job-based pay structures, pay structure by job classification are expanding while seniority -based pay structure & skill-based pay structure are gradually shrinking; second, specific items consisting of pay are simplified; third, the proportion of the standard pay(base pay, a fixed term pay) is increasing; fourth, The pay structure by the life stages is composed differently of several elements. fifth, allowances have a wide variety, and they are reduced or eliminated; finally the bonus are reduced or eliminated, and the variable bonus are widely used.