Work and Wages

Minimum Wage

In accordance with section 91 of the Labour Code 2012, workers' salary must at least be equal to the minimum wage, i.e., a wage which will ensure the minimum living needs of the employees and their families and which is based on the local social & economic conditions as well as the normal wage in the labour market.

In accordance with the Labour Code 2012, Government shall announce the regional minimal wage on the basis of the recommendations of the National Wages Council. National Wages Council is a tripartite body with representation from Government, employer and workers. The minimum wage rate is determined on hourly, daily, and monthly basis for different sectors and regions.

The region based minimum wage levels are applicable to the labourers working under labour contract for companies, enterprises, cooperatives, cooperative groups, farms, households, individuals, agencies, and organizations employing labourers. Wages may be determined by agreement between the workers and the employer (employment contract) as well through collective bargaining agreement however these can't be lower than the government announced minimum wage levels. The new Decree further requires that the minimum wage rate of a trained worker must at least be 7% higher than the region based minimum wage rate. The wage level for heavy, hazardous and dangerous working conditions must at least be 5% (7% for special hazardous conditions) higher than the regional minimum wage rate.

The monthly wage paid to an employee who performs the simplest work (unskilled worker) under normal working conditions must not be lower than the regional minimum wage. Enterprises coming under regional minimum wages are required to develop a salary scale and wage table and to calculate benefits paid for employees. Employers are required to consult with relevant trade union and send the wage scales to the labour management authority at the district level. These wage scales are used as a basis for recruitment and employment, wage negotiation and wage payment. Employers are required to make these wage scales publicly available at the workplace before implementation.

Employers may agree with probationary workers to pay a probation salary equal to at least 85% of the normal wage. If an apprentice (during apprenticeship or vocational training) directly or indirectly produces products for sale, wages must be agreed between the parties (apprentice and the enterprise). Temporary workers are entitled to the same wage as other workers, plus any additional benefits.

Compliance with the provisions of Labour Code including minimum wages is the responsibility of The MOLISA (Ministry of Labour, Invalids and Social Affairs) Inspectorate. 

In line with article 13 of the 2013 Decree, if an employer pays its workers at a rate lower than the minimum wage decided by the Government, the employer is liable to:

  1. a fine from 20,000,000 VND to 30,000,000 VND, if the violation concerns 01 - 10 workers;
  2. a fine from 30,000,000 VND to 50,000,000 VND, if the violation concerns 11 - 50 workers; and
  3. a fine from 50,000,000 VND to 75,000,000 VND, if the violation concerns 51 workers or more.
  4. Other than this, the Decree allows suspension of enterprise operations for one to three months for payment of wages lower than the minimum wage rate declared by the government.

Sources: §28, 61, 91-93 of Labour Code (Law No. 10/2012/QH13); Decree detailing the Implementation of a Number of Articles of the Labour Code on Wages (No 49/2013/ND-CP); §13 of the Decree No. 95/2013/ND-CP dated 22 August 22 2013 

Regular Pay

An employer may make the payment of wages by time (hourly, daily, or on monthly basis), piecework or completion of a task. The only condition is that the chosen form of payment is maintained for a certain period. In case of any change, the employer must notify the worker(s) at least 10 days in advance.

Wages may be paid in cash or paid directly into an employee's individual bank account. The employees must be paid wages directly, fully and in a timely manner (as agreed in the employment contract). In case the wages are not paid in a timely manner, it must not be later than 01 month (from its due date) in special cases. If delay exceeds 15 days, the employer must pay the employee an additional amount which is equal to the arrears of salary multiplied by the ceiling of the one-month  deposit interest rate announced by the State Bank of Vietnam at the time of payment.  

In accordance with the provisions of Labour Code, an employer is under the obligation to pay workers the wages: at least once in 15 days to employee whose salary is determined on hourly, daily or weekly basis; at least once a month or once a fortnight to employee whose salary is determined on monthly basis; and as agreed upon between the parties for the employees whose salaries are determined on the basis of product (completion of a task) and piecework. If the work has to be done in many months, the monthly salary shall be advanced by the volume of work done during the month.

The employer is only entitled to deduct the salary of employee for the compensation of damages of tools and equipment of the employer to the extent only as provided under the Labour Code. Employee must be informed about the reasons for deduction of salary however the monthly deduction cannot exceed 30% of employee's monthly salary after the payment of compulsory social insurance, health insurance, unemployment insurance and income tax.

In line with a 2018 Decree (No. 121/2018/ND-CP), enterprises have to establish Labour productivity norms as the basis for giving product-based pay to employees. However, an enterprise employing less than 10 workers is exempt from submitting its pay scale, payroll, and Labour productivity norms to the Labour authority of district where business is located.

sources: §94-96 & 101 of Labour Code (Law No. 10/2012/QH13)

Regulations on Work and Wages

  • Luật Lao động, 2012 / Labour Code, 2012

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