In Vietnam, is it permissible for employees to have a pay raise annually?
In Vietnam, is it permissible for employees to have a pay raise annually? In Vietnam, what are the fines imposed to companies for not raising salary as in agreement?
Hello Lawnet. My sister, who is working at Import and Export Company B, has her pay raised annually. In the coming time, I will go to the second round of interview at V garment manufacturing company to negotiate my salary. I wonder if employees can have a pay raise annually at any company.
Thank you
In Vietnam, is it permissible for employees to have a pay raise annually?
Pursuant to Clause 6, Article 3 of the Circular 10/2020/TT-BLDTBXH stipulating major contents of an employment contract in Vietnam as follows:
6. Advancement in pay step, pay raise: as agreed by the contracting parties concerning conditions, time, pay rate after advancement in pay step, pay raise, or as regulated in the collective bargaining agreement, or as stipulated by the employer.
Pursuant to Article 90 of the Labour Code in 2019 stipulating salaries as follows:
1. A salary is an amount the employer pays the employee under an agreement for a work performed by the latter. Salary equals (=) base salary plus (+) allowances and other additional amounts.
2. The base salary must not fall below the statutory minimum wages.
3. Employers shall pay salaries fairly without discrimination against genders of employees who perform equal works.
Currently, there is no regulations on annual pay raise for employees. Pay rise depends on agreement between 2 parties, or regulations in the collective bargaining agreement, or stipulation by the employer. In addition, The base salary must not fall below the statutory minimum wages. Therefore, if the statutory minimum wages is adjusted anually, your salary shall raise accordingly.
In Vietnam, what are the fines imposed to companies for not raising salary as in agreement?
Pursuant to Clause 2, Article 17 of the Decree 12/2022/ND-CP stipulating violations against regulations on salaries as follows:
2. The following fines shall be imposed upon an employer for commission of one of the following violations: Failing to pay salaries on schedule as prescribed by law; failing to pay or insufficiently paying salaries to employees as agreed in their employment contracts; failing to make or insufficiently making overtime pay; failing to make or insufficiently making nightshift pay; failing to pay or insufficiently paying work suspension allowances as prescribed by law; restricting or interfering employees’ spending of their salaries; forcing employees to spend their salaries on goods or services of the employer or any particular providers decided by the employer; deducting from employees’ salaries in breach of law; failing to pay or insufficiently paying salaries to employees how are reassigned to perform works which are not specified in their employment contracts or during a strike; failing to make or insufficiently making payments to employees who, due to employment termination or job loss, have not taken or not entirely taken up their annual leave in compensation for their untaken leave days; failing to make or insufficiently making advance payments to employees who temporarily leave their works in accordance with regulations of law; failing to pay full salaries to employees who are not disciplined for their work suspension period:
a) A fine ranging from VND 5.000.000 to VND 10.000.000 shall be imposed if the violation involves 01 - 10 employees;
b) A fine ranging from VND 10.000.000 to VND 20.000.000 shall be imposed if the violation involves 11 - 50 employees;
c) A fine ranging from VND 20.000.000 to VND 30.000.000 shall be imposed if the violation involves 51 - 100 employees;
d) A fine ranging from VND 30.000.000 to VND 40.000.000 shall be imposed if the violation involves 101 - 300 employees;
dd) A fine ranging from VND 40.000.000 to VND 50.000.000 shall be imposed if the violation involves 301 employees or more.
Pursuant to Clause 1, Article 6 of the Decree 12/2022/ND-CP stipulating as follows:
1. The fines for administrative violations prescribed in Chapter II, Chapter III and Chapter IV of this Decree shall be imposed upon violating individuals, except the fines in Clauses 1, 2, 3, 5 Article 7, Clauses 3, 4, 6 Article 13, Clause 2 Article 25, Clause 1 Article 26, Clauses 1, 5, 6, 7 Article 27, Clause 8 Article 39, Clause 5 Article 41, Clauses 1 through 12 Article 42, Clauses 1 through 8 Article 43, Clauses 1 through 6 Article 45, Clause 3 Article 46 of this Decree. The fine imposed upon an organization is twice as much as that imposed upon an individual for committing the same administrative violation.
As regulations above, the act of not raising salary for employees shall be fined up to VND 100,000,000. Besides, the fine shall depend on the number of employees who do not receive a raise as agreed.
Best regards!
