How to formulate public employee payrolls after the 2024 salary reform in Vietnam under the Resolution 27?

How to formulate public employee payrolls after the 2024 salary reform in Vietnam under the Resolution 27? - asked Mrs. T (Hanoi)

How to formulate public employee payrolls after the 2024 salary reform in Vietnam under the Resolution 27?

According to Resolution 104/2023/QH15 on the state budget estimate for 2024, starting from July 1, 2024, comprehensive salary policy reforms will be implemented according to Resolution 27-NQ/TW in 2018.

Resolution 27-NQ/TW in 2018 establishes new payrolls for 2024 based on job positions and leadership positions, replacing the current payroll system. The transition will ensure that the new salaries are not lower than the current ones.

There will be 02 public employee payrolls in 2024 during the salary reform according to Resolution 27:

Payroll 1:

This payroll applies to public employees holding leadership positions (elected and appointed) in the political system from the central level to the commune level.

Payroll 2:

This payroll applies to specialized and technical positions based on professional titles for public employees who do not hold leadership positions. Each professional title will have multiple pay steps.

Pursuant to Resolution 27-NQ/TW in 2018, the structure of the new public employee salaries during the 2024 salary reform is calculated as follows:

Salary = base pay + Allowances (if any) + Bonuses (if any)

Where:

Base pay accounts for approximately 70% of the total salary fund.

Allowances account for approximately 30% of the total salary fund.

Bonuses: The bonus fund is about 10% of the total annual salary fund, excluding allowances

Therefore, when implementing the 2024 salary reform, Resolution 27-NQ/TW in 2018 has agreed that the allowances received by public employees will account for approximately 30% of the total salary fund and include the following specific allowances:

Multi-position allowances;

Extra seniority allowances;

Region-based allowances;

Responsibility allowances;

Mobility allowances;

Incentives allowances;

Allowances for work in areas with particularly difficult socio-economic conditions;

Allowances based on administrative unit classification and public service providers ranking.

Furthermore, Resolution 27-NQ/TW in 2018 also eliminates the following allowances for public employees during the 2024 salary reform according to job positions:

- Seniority allowances;

- Leadership position allowances (as leadership positions in the political system implement position-based salaries);

- Party and political-social organizations allowances;

- Official duty allowances (as they have been included in the base pay);

- Hazardous and dangerous allowances (as they have been incorporated into allowances based on vocational factors).

How to formulate public employee payrolls after the 2024 salary reform in Vietnam under the Resolution 27?

When will the latest public employee payrolls for the 2024 salary reform be issued?

The government has recently issued Resolution 01/NQ-CP in 2024 on the tasks and key solutions for implementing the economic-social development plan and the state budget estimate for 2024, which includes important directives related to the salary reform.

According to Appendix IV attached to Resolution 01/NQ-CP in 2024, the Ministry of Home Affairs is assigned to lead the implementation, and by May 2024, they must complete the decree on the new salary regime for officials, public employees, and armed forces.

Resolution 01/NQ-CP in 2024 also explicitly states the implementation of the salary reform according to Resolution 27-NQ/TW in 2018 of the Central Executive Committee on the reform of salary policies for officials, public employees, armed forces, and workers in enterprises.

Therefore, the latest public employee payrolls for the 2024 salary reform may be available in May 2024.

Note: May 2024 is only the completion time for the new payrolls. The official issuance and application of these payrolls will depend on further guidance from the government

Vietnam: Will the latest public employee payrolls in 2024 still be based on statutory pay rate?

Pursuant to Resolution 27-NQ/TW in 2018, specific factors were agreed upon to design the new payrolls, including the following:

II. DIRECTIVES, OBJECTIVES, AND CONTENTS OF THE REFORM
...
3. Reform contents
3.1. For officials, public employees, and armed forces (public sector)
...
c) Determining specific factors to design the new payrolls
- Annulling the current statutory pay rate and salary coefficient, and constructing the base pay as a specific amount in the new payrolls.
- Implementing a unified labor contract regime according to the regulations of the Labor Code (or a service contract) for individuals performing surplus or service jobs (requiring training below intermediate level), without applying the officials and public employees payrolls to these individuals.
- Determining the minimum salary level for officials and public employees in the public sector as the salary of individuals performing jobs requiring intermediate-level training (level 1), not lower than the minimum salary of trained labor in the enterprise sector.
- Expanding the salary relationship as a basis for determining specific salary amounts in the payroll system, gradually approaching the salary relationship in the enterprise sector that is appropriate to the state's resources.
- Improving the regular pay raise and pay raise ahead of schedule for officials, public employees, and armed forces in accordance with the provisions of the new payrolls.
...

Therefore, based on the guiding spirit of Resolution 27-NQ/TW in 2018, the latest public employee payrolls in 2024 will no longer include the current statutory pay rate and salary coefficient. Instead, the base pay will be constructed as a specific amount in the new payrolls

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