Is it possible not to pay a salary higher than 7% of the region-based minimum wage for employees with university or college degrees who sign labor contracts in Vietnam after July 1, 2022?
- Is there no longer stipulated a salary higher than 7% for employees with university or college degrees in Decree 38/2022/ND-CP in Vietnam?
- Will the employees with college and university degrees have their wages lowered in Vietnam?
- Is it possible not to pay a salary higher than 7% of the region-based minimum wage for employees with university or college degrees who sign labor contracts in Vietnam after July 1, 2022?
Is there no longer stipulated a salary higher than 7% for employees with university or college degrees in Decree 38/2022/ND-CP in Vietnam?
According to current regulations (before July 1, 2022), Clause 1, Article 5 of Decree No. 90/2019/ND-CP stipulates the region-based minimum wages applicable to employees working under labor contracts as follows: after:
- The region-based minimum wages referred to in Article 3 hereof are the lowest rates used as the basis for any arrangement between enterprises and employees on salary and salary payment. The wage paid to an employee who works under normal working conditions, ensures the required monthly working hours and has fulfilled the predetermined labor productivity norm or agreed-upon duties shall:
- Not be lower than the region-based minimum wage paid to an unskilled worker who performs simplest duties; and
- Be at least 7% higher than the region-based minimum wage paid to a skilled worker as prescribed in Clause 2 of this Article.
In Article 4 of Decree 38/2022/ND-CP, effective from July 1, 2022, re-stipulating the application of the region-based minimum wage for employees, it is stipulated as follows:
- The statutory minimum wage per month is the minimum wage used as the basis for any agreement between employers and employees on monthly salary and payment thereof. The job- or position-based salary of an employee who ensures the monthly normal working hours and has fulfilled his/her labor productivity norms or tasks as agreed shall not be lower than the statutory minimum wages per month.
- The statutory minimum wage per hour is the minimum wage used as the basis for any agreement between employers and employees on hourly salary and payment thereof. The job- or position-based salary paid for every working hour to an employee who has fulfilled his/her labor productivity norms or tasks as agreed shall not be lower than the statutory minimum wages per hour.
- In case an employee receives a weekly or daily salary, a piece-rate pay or a fixed pay, the wages paid to the employee, when converted into monthly or hourly salary, shall not be lower than the statutory minimum wage per month or per hour. The normal working hours-based converted monthly or hourly salary shall be subjected to the employer’s decision in accordance with regulations of law.
Thus, from July 1, 2022, according to Decree 38/2022/ND-CP, there are no longer regulations on the application of a salary higher than 7% for employees with college and university degrees.
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Is it possible not to pay a salary higher than 7% of the region-based minimum wage for employees with university or college degrees who sign labor contracts in Vietnam after July 1, 2022?
Will the employees with college and university degrees have their wages lowered in Vietnam?
In Article 5 of Decree 38/2022/ND-CP stipulates:
- Employees shall review and make appropriate modifications to their agreements in employment contracts, collective bargaining agreements as well as other regulations and rules; are not allowed to cut or reduce any overtime pay, nightshift pay, perquisites and other benefits paid to employees as prescribed by the Labor Code. Agreements or commitments under employment contracts, collective bargaining agreements or other lawfully concluded agreements that are more advantageous to employees than the provisions of this Decree shall remain valid, unless otherwise agreed upon between the parties.
In the spirit of the above Decree, Official Dispatch 2086/BLDTBXH-TLDLDVN in 2022 on directing the implementation of Decree 38/2022/ND-CP on region-based minimum wages issued by the Ministry of Labor, War Invalids and Social Affairs - General Confederation of Labor The Vietnamese Government promulgates the following regulations:
- With respect to the contents agreed and committed in the labor contract, labor agreement or other lawful agreements that are more beneficial to the employee than the provisions of this Decree, the implementation shall continue, unless otherwise agreed by the parties, according to which, the implemented contents including the salary regime paid to employees doing jobs or titles requiring vocational training or vocational training are at least slightly higher. At least 7% of the minimum salary, the implementation will continue, unless otherwise agreed upon between the parties in accordance with the provisions of the labor law.
Thus, although the new regulations issued from July 1, 2022 no longer require paying salaries higher than 7% for employees with university and college degrees, however, employees will not be reduced. salary if they have signed a labor contract, labor agreement or other lawful agreements as prescribed previously to ensure the interests of employees in the spirit of the labor law, unless otherwise agreed upon between the parties.
Is it possible not to pay a salary higher than 7% of the region-based minimum wage for employees with university or college degrees who sign labor contracts in Vietnam after July 1, 2022?
According to Official Dispatch 2086/BLDTBXH-TLDLDVN in 2022, guiding the implementation of Decree 38/2022/ND-CP on region-based minimum wages, the responsibilities of employees are as follows:
- Review the agreements in the labor contract, the collective labor agreement and the employer's regulations and regulations to adjust and supplement accordingly; must not remove or reduce salary regimes when employees work overtime, work at night, compensation in kind and other regimes in accordance with the labor law.
- With respect to the contents agreed and committed in the labor contract, labor agreement or other lawful agreements that are more beneficial to the employee than the provisions of this Decree, the implementation shall continue, unless otherwise agreed by the parties
Accordingly, the implemented contents, including the salary regime paid to employees who perform jobs or titles that require vocational training or vocational training, at least 7% higher than the minimum wage, shall continue to continue to perform, unless otherwise agreed upon between the parties in accordance with the provisions of the labor law.
Thus, the labor contracts signed previously with a salary 7% higher than the region-based minimum wage for employees with university and college degrees will continue to be implemented, however, the official letter did not mention it. Regarding the issue of the salary of the labor contract that has not been signed after July 1, 2022 in this case, therefore, referring to the provisions of Decree 38/2022/ND-CP, the employer may not need to pay employees with university and college degrees a salary 7% higher than the region-based minimum wage as prescribed previously, unless otherwise agreed upon between the parties as well as in the labor agreement.
Decree 38/2022/ND-CP takes effect from July 1, 2022.
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