Vietnam eyes 6% increase in regional minimum wage

Base pay for any position must not exceed the minimum wage, while allowances and benefits are at the employer's discretion.

Vietnam’s Ministry of Labour, War Invalids, and Social Affairs has proposed a decree to regulate minimum wages for employees under employment contracts. 

The draft suggests a 6% increase in the regional minimum wage, which is set to take effect on 1 July 2024. 

Employees are expected to receive additional benefits once this regional minimum wage hike is officially approved.

When the minimum wage increases, employees will receive a higher monthly salary along with enhanced benefits. 

Article 90 of the Employment Code specifies that employee salaries consist of base pay, allowances, and other benefits. The base pay for any position should not exceed the minimum wage, while allowances and benefits are at the employer's discretion. The proposed monthly regional minimum wages are as follows: Region I: 4,960,000 VND (US$194), Region II: 4,410,000 VND (US$173), Region III: 3,860,000 VND (US$151), Region IV: 3,450,000 VND (US$135).

In the case of work stoppages, employees are compensated differently depending on the cause. If the stoppage is due to the employee's fault, they will not be paid.

However, if it is caused by external factors beyond the employer's control, such as natural disasters or government-ordered relocations, employees must be compensated at least the minimum wage for the first 14 days. 

When employees are reassigned to a different job, their salary should match or be higher than the minimum wage. If the new job pays less, they will retain their original salary for 30 working days.

Compensation for damage to company property is also covered by legal provisions, with employees required to compensate for any damage caused up to a maximum of three months' salary if the damage is minor.