Salaries of Employees in Enterprises When Implementing the 2024 Wage Reform: How Will They Change?
How will employees' salaries in enterprises change with the 2024 wage reform?
Based on point b, sub-item 3.2, Section 3, Part II of Resolution 27/NQ-TW 2018, the reforms to the wage system for employees in enterprises are as follows:
DIRECTIVE VIEWPOINTS, OBJECTIVES, AND CONTENT OF THE REFORM
...
3. Content of the reform
3.2. For employees in enterprises
b) On salary and income management mechanisms
- Enterprises (including state-owned enterprises) are entitled to autonomously decide on their salary policies (including wage scales, salary tables, and labor norms) and pay salaries not lower than the minimum salary announced by the State, based on collective labor agreements that are suitable for production organization, labor organization, enterprise capacity, and are publicly disclosed at the workplace.
- The State announces regional minimum wage levels by month and by hour, average market wages for various industries, and supports the provision of labor market information. It does not directly intervene in enterprise salary policies. Enterprises and employees negotiate and reach agreements on salaries, sign labor contracts, and pay wages based on productivity and labor results. Enterprises and labor representative organizations negotiate and agree on salaries, bonuses, and other incentive policies in collective labor agreements or enterprise regulations. The role and capacity of trade unions and the inspection and inspection work of state management agencies should be strengthened.
...
Thus, according to the wage reform content in Resolution 27/NQ-TW 2018, the state announces regional minimum wage levels by month and by hour, the average market wages for various industries, and supports the provision of labor market information. It does not directly intervene in the salary policies within enterprises.
Enterprises and employees can negotiate and reach agreements on salaries, sign labor contracts, and pay wages based on productivity and labor results. Enterprises and labor representative organizations can negotiate and agree on salaries, bonuses, and other incentive policies in collective labor agreements or enterprise regulations.
Hence, employees' salaries will continue to apply regional minimum wage levels and be based on negotiations and agreements between enterprises and employees.
Salaries of employees in enterprises in the context of the 2024 wage reform
What is the current regional minimum wage?
According to Clause 1, Article 3 of Decree 38/2022/ND-CP, the monthly minimum wage and hourly minimum wage for employees working for employers are as follows:
| Region | Monthly Minimum Wage (Unit: VND/month) | Hourly Minimum Wage (Unit: VND/hour) || --- | --- | --- || Region 1 | 4,680,000 | 22,500 || Region 2 | 4,160,000 | 20,000 || Region 3 | 3,640,000 | 17,500 || Region 4 | 3,250,000 | 15,600 |
The regional hourly minimum wage rates are as follows:
- Region 1: 22,500 VND/hour.- Region 2: 20,000 VND/hour.- Region 3: 17,500 VND/hour.- Region 4: 15,600 VND/hour.
*Note: The regional minimum wage is the lowest wage serving as the basis for negotiating and paying wages for employees, ensuring that the wage for the job or position of employees working full-time, completing the agreed labor norms or job responsibilities, is not lower than the minimum wage.
Specific timeline for wage reform for officials and public employees according to Resolution 27
Based on Resolution 27-NQ/TW 2018, specific objectives for wage reform from 2021 to 2025 and vision to 2030 include:
(1) For the public sector:
- From 2021, apply new unified wage policies for officials and public employees, armed forces across the entire political system.- In 2021, the lowest wage for officials and public employees equals the average minimum wage in enterprises across regions.- Periodically raise wage levels in line with the consumer price index, economic growth rate, and state budget capabilities.- By 2025, the lowest wage for officials and public employees will be higher than the average minimum wage in enterprises across regions.- By 2030, the lowest wage for officials and public employees will be equal to or higher than the highest regional minimum wage in enterprises.
(2) For the enterprise sector:
- From 2021, the State will periodically adjust the regional minimum wage based on recommendations from the National Wage Council. Enterprises will implement wage policies through negotiations and agreements between employers and employees and their representatives; the State does not directly intervene in enterprise wage policies.- Manage labor and wages in state-owned enterprises through labor cost contracting linked to business task performance until 2025 and towards contracting business tasks of enterprises by 2030.
LawNet