Finalized 6% Increase in Regional Minimum Wage for 2024 Starting From July 01, 2024? What is the Current Regional Minimum Wage?
Agreement on 6% Regional Minimum Wage Increase in 2024 Effective from July 1, 2024?
On the morning of December 20, the National Wage Council held its second meeting of 2023 to discuss and negotiate the plan for adjusting the regional minimum wage in 2024.
In his concluding remarks of the meeting, after listening to the opinions of the relevant parties, the Deputy Minister of Labor - Invalids and Social Affairs, Chairman of the National Wage Council stated that all members of the National Wage Council present at the meeting voted to approve a 6% increase in the regional minimum wage for 2024, effective from July 1, 2024.
| Previously, the Vietnam General Confederation of Labor proposed two plans for adjusting the regional minimum wage from July 1, 2024, with respective increases of 7.3% and close to 6.5%.
Plan 1: Adjust the minimum wage from July 1, 2024, with an increase ranging from 250,000 VND to 320,000 VND, an average increase of 7.3%.
Plan 2: Adjust the minimum wage from July 1, 2024, with an increase ranging from 220,000 VND to 290,000 VND, an average increase of 6.48%. || --- |
Agreement on 6% Regional Minimum Wage Increase in 2024 Effective from July 1, 2024? What is the current regional minimum wage?
What is the current regional minimum wage?
In 2023, the regional minimum wage for employees continues to be implemented according to Decree 38/2022/ND-CP with the specific amounts as follows:
| Region | Regional Minimum Wage in 2023 || --- | --- || Region I | 4,680,000 VND/month
22,500 VND/hour || Region II | 4,160,000 VND/month
20,000 VND/hour || Region III | 3,640,000 VND/month
17,500 VND/hour || Region IV | 3,250,000 VND/month
15,600 VND/hour |
Therein, the application of regional areas is determined based on the place of operation of the employer as follows:
- Employers operating in a region shall apply the minimum wage stipulated for that region.
- Employers having units or branches operating in regions with different minimum wages shall apply the minimum wage stipulated for the region where the unit or branch operates.
- Employers operating in industrial zones, export processing zones located in regions with different minimum wages shall adopt the minimum wage of the highest region.
- Employers operating in a region with a changed name or division shall temporarily apply the minimum wage stipulated for the region before the name change or division until the Government of Vietnam provides new regulations.
- Employers operating in newly established regions from one or more regions with different minimum wages shall adopt the minimum wage of the highest region.
- Employers operating in newly established provincial cities from one or more regions of Region IV shall apply the minimum wage stipulated for other provincial cities in accordance with clause 3 of the Appendix issued with this Decree.
Regulations on Minimum Wage in the Labor Code 2019
According to the provisions of Article 91 of the Labor Code 2019:
Minimum Wage
1. The minimum wage is the lowest wage paid to an employee performing the simplest jobs in normal working conditions, ensuring a minimum standard of living for the employee and their family, suitable with the socio-economic development conditions.
2. The minimum wage is determined by region and set per month or per hour.
3. The minimum wage is adjusted based on the minimum living standards of employees and their families; the correlation between the minimum wage and wages in the market; consumer price index, economic growth rate; labor supply and demand; employment and unemployment; labor productivity; and the paying capacity of enterprises.
4. The Government of Vietnam specifies this Article in detail; decides and announces the minimum wage based on recommendations of the National Wage Council.
Hence, the minimum wage is regulated as mentioned above.
The minimum wage is the lowest wage paid to an employee performing the simplest jobs in normal working conditions, ensuring a minimum standard of living for the employee and their family, in accordance with the socio-economic development conditions.
Furthermore, the National Wage Council advises the Government of Vietnam on the minimum wage and wage policies for employees.
The Prime Minister of the Government of Vietnam establishes the National Wage Council, which includes representatives from the Ministry of Labor - Invalids and Social Affairs, the Vietnam General Confederation of Labor, some central organizations representing employers, and independent experts.
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