Expected Adjustment of Regional Minimum Wage Areas from July 1, 2024: How Will It Be Implemented?
How will the adjustment of regional minimum wage areas from July 1, 2024, be planned?
According to the Draft Decree stipulating regional minimum wage levels, the list of areas enjoying regional minimum wage levels is adjusted as follows:
- Adjust from region 2 to region 1 for: Quang Yen town, Dong Trieu town, Uong Bi city, Mong Cai city under Quang Ninh province.
- Adjust from region 3 to region 2 for: Thai Binh city under Thai Binh province, Thanh Hoa city, Sam Son city, Nghi Son town, Bim Son town under Thanh Hoa province; Ninh Hoa town under Khanh Hoa province; Soc Trang city under Soc Trang province.
- Adjust from region 4 to region 3 for: Thai Thuy district, Tien Hai district under Thai Binh province; the districts of Trieu Son, Tho Xuan, Yen Dinh, Vinh Loc, Thieu Hoa, Ha Trung, Hau Loc, Nga Son, Hoang Hoa, Nong Cong under Thanh Hoa province; Ninh Phuoc district under Ninh Thuan province.
Thus, if the Draft Regulation on regional minimum wage increase is applied:
- Workers in region 4 moving to region 3 will get a wage increase of 410,000 VND;
- Workers in region 3 moving to region 2 will get a wage increase of 550,000 VND;
- Workers in region 2 moving to region 1 will get a wage increase of 550,000 VND.
Note: The wage increase applies to workers with wages lower than the regional minimum wage.
How will the adjustment of regional minimum wage areas from July 1, 2024, be planned? (Image from the Internet)
Is the regional minimum wage applicable to individuals hiring labor?
At Article 2 of Decree 38/2022/ND-CP stipulating the applicable subjects as follows:
Applicable subjects
Workers working under labor contracts in accordance with the Labor Code.
Employers in accordance with the Labor Code, including:
a) Enterprises as stipulated by the Law on Enterprises.
b) Agencies, organizations, cooperatives, households, individuals hiring, employing workers to work for them under agreements.
- Other agencies, organizations, individuals related to implementing the minimum wage stipulated in this Decree.
Thus, individuals hiring labor are among the subjects applicable to the regional minimum wage.
How is the region for the regional minimum wage determined?
At Clause 3, Article 3 of Decree 38/2022/ND-CP stipulating the minimum wage for workers working for employers by region as follows:
Minimum wage
...
- The application of regional areas is determined according to the operational location of the employer as follows:
a) Employers operating in any regional area shall apply the minimum wage stipulated for that area.
b) Employers with units or branches operating in areas with different minimum wages shall apply the minimum wage stipulated for each area where the unit or branch is located.
...
Thus, the determination of the area for applying regional minimum wage is regulated according to the employer’s operational location, specifically as follows:
- Employers operating in any regional area shall apply the minimum wage stipulated for that area.
- Employers with units or branches operating in areas with different minimum wages shall apply the minimum wage stipulated for the area where the unit or branch is located.
- Employers operating in industrial zones, export processing zones located in areas with different minimum wages shall apply the highest minimum wage applicable to those areas.
- Employers operating in areas with name changes or separations shall temporarily apply the minimum wage stipulated for the area before the change until a new regulation is issued.
- Employers operating in newly established areas from one or multiple areas with different minimum wages shall apply the highest minimum wage applicable to those areas.
- Employers operating in provincial cities newly established from one or more areas in region 4 shall apply the minimum wage stipulated for other provincial cities as stipulated in Clause 3 of the Appendix issued together with Decree 38/2022/ND-CP.
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