Is working overtime typically compensated in Japan?
Overtime pay is required by law. No argument there. Japanese labor law is at first glance very strict and very generous to those working overtime.
The problem here is the way that it's implemented. There are ways to circumnavigate the law, and a lot of companies labelled as "black" (i.e. known to violate labor laws) do so without hesitation or caring who knows it.
Unfortunately, without the employees going on strike or suing the company, a lot of this doesn't come to light. There's a reason that karoushi ("death by overworking") is actually a thing in Japan. The cultural mindset of working environments is "The longer you work, the harder you appear to be working... and oh, also? Shut up about it."
I worked in a "black" company for five years. (The hotel I worked in was owned by one of the biggest companies in the country.) I witnessed a karoushi first hand, one of the sous-chefs who suffered a heart attack due to work stress. It's a sad and very real downside to the Japanese work culture.
The way my company avoided paying us for overtime was simple: we just clocked in and out at normal times. We were required to run our employee cards under a scanner at the hotel's staff entrance as well, but when we had to come in extra early or leave later than labor law required, we just had a kitchen guy run all of our employee cards up to the staff entrance and "fake" our exits.
On paper, we were working 9 to 5 jobs. In reality, we were often in the kitchen for over 12 hours every day- in busy months like December or August, some of us were working 80 hours a week without breaking a sweat, and with maybe 10 hours of overtime pay.
But no matter how we felt about it, none of us spoke up- it was so matter-of-fact, so normal, that bucking against the current and reporting to higher-ups in the hotel just wasn't considered an actual option.
I hope the Japanese culture changes somehow. All of Japan does. The karoushi aspect of working in Japan is so complex, so intrinsic to the culture, that it's hard to explain and even harder to change for the better. So much so that I won't attempt it any further.
But if you're thinking of working in Japan, it would be to your benefit to at least browse around and check if it's known as a "black" company. You may save yourself a lot of unnecessary stress.