Important policies affect all officials, public employees and employees in Vietnam in 2021

1. Statutory pay rate in 2021 is VND 1.490.000/month

On November 12, 2020, the National Assembly of Vietnam voted to approve the Resolution No. 128/2020/QH14 on the state budget estimate for 2021. In which, the notable content is that no adjustment to the statutory pay rate shall be made in 2021.

Thus, due to the impact of the COVID-19 epidemic, the statutory pay rate in 2021 will not increase and will remain at VND 1.490.000/month according to the provisions of Decree No. 38/2019/NĐ-CP of Vietnam’s Government on statutory pay rate for public officials and public employees and the armed forces. Accordingly, the fact that the statutory pay rate does not increase will lead to the salary and some allowances of officials and public employees calculated on the statutory pay rate will remain the same as at present.

Due to the fact that  the statutory pay rate of officials and public employees in 2021 will remain at VND 1.490.000/month, the salary of officials and public employees in 2021, which is equal to the salary coefficient multiplied by the statutory pay rate, will still remain. Accordingly, payroll of officials and public employees will include:

- Professional payroll for officials in state agencies;

- Professional payroll for officials and public employees in state non-business units.

View more details of payroll of officials and public employees in 2021 here.

2. Remaining the region-based minimum wages in 2021

According to Point a Clause 1 Article 96 and Clause 1 Article 103 of the Decree No. 145/2020/NĐ-CP of Vietnam’s Government, from January 01, 2021, the region-based minimum wages prescribed in the Government’s Decree No. 90/2019/ND-CP dated shall apply.

According to the above provisions, it can be seen that the region-based minimum wages prescribed in the Government’s Decree No. 90/2019/ND-CP will still be applied from 2021. To be specific:

- For enterprises located in region I: VND 4,420,000/month.

- For enterprises located in region II: VND 3,920,000/month.

- For enterprises located in region III: VND 3,430,000/month.

- For enterprises located in region IV: VND 3,070,000/month.

Views details of region-based minimum wages in 2021 of 63 provinces and cities of Vietnam here.

3. Increasing retirement ages of employees

According to Clause 2 Article 169 of the Labor Code 2019 of Vietnam, since January 01, 2021, the retirement age of employees under ordinary working conditions are 60 years 3 months for male employees and 55 years 4 months for female employees; and the age increases by 3 months for male employees each successive year until he reaches 62 in 2028 and increases by 4 months for female employees each successive year until she reaches 60 in 2035.

Thus, officially from 2021, the retirement ages shall be 60 years 03 months for males (increased by 3 months compared to the Labor Code 2012) and 55 years 04 months for females (increased by 4 months compared to the Labor Code 2012).

The roadmap to adjust the retirement ages of employees shall be done as follows:

4. Increasing benefit levels of off-line health insurance benefits at provincial hospitals

According to Article 22 of the Law on Health Insurance 2008 of Vietnam amended by Clause 15 Article 1 of the Law on amendments to some articles of the Law on Health insurance in 2014:

3. In case any card holder goes to a hospital different from the registered hospital except for the insured prescribed in Clause 1 this Article, his or her costs shall be covered by the health insurance fund according to the benefit levels prescribed in Clause 1 this Article as follows:

…

b) 60% of the inpatient treatment expenditures at the provincial hospitals from the effective date of this Law to December 31, 2020; total inpatient treatment costs from January 01, 2021 at all hospitals in Vietnam.

According to this provision, from January 01, 2021, people with health insurance cards who go to the wrong medical examination and treatment at the provincial hospital will be paid the same inpatient treatment costs as going to the right medical examination and treatment. That is, from this point on, users of health insurance cards whose initial medical examination and treatment place is a district hospital do not need to have a referral to a provincial hospital for inpatient treatment as at present.

However, users of health insurance cards when going for medical examination and treatment at the right level should note that not in all cases will be paid 100% of the cost, but depending on who the user is. Because the level of enjoyment of the wrong level health insurance card will be based on the same level of benefit as going to the right medical examination and treatment, not everyone is entitled to the payment of 100% of the inpatient treatment costs when the health insurance card is opened to the province. Depending on the type of card, the benefit can be 100%; 95% or only 80% of the cost of inpatient treatment.

5. Early retirement for officials and public employees subject to downsizing

Officials and public employees subject to downsizing in 2021 are entitled to early retirement in accordance with Decree No. 143/2020/NĐ-CP of Vietnam’s Government. Specifically, the following persons will be entitled to the policy of not having their pension rate deducted when they retire before age:

- Displaced employees being 50 years old and 03 months to 53 years old and 03 moths (for men) and 45 years old and 04 months to 48 years old and 04 months (for women), paying social insurance premiums for at least 20 years and working in heavy, dangerous or hazardous industries on the list jointly released by the Ministry of Labor, War Invalids and Social Affairs and Ministry of Health for at least 15 years; or working for in areas having region-based allowances of at least 0.7 for at least 15 years;

- Displaced employees being from 55 years old and 03 months to 58 years old and 03 months (for men) and 50 years old and 04 months to 53 years old and 04 months (for women), paying social insurance premiums for at least 20 years;

- Displaced employees being from 53 years and 03 months to 55 years old and 03 months (for men) and 48 years old and 04 months to 50 years old and 04 months (for women), and paying social insurance premiums for at least 20 years and working in heavy, dangerous or hazardous industries on the list jointly released by the Ministry of Labor, War Invalids and Social Affairs and Ministry of Health for at least 15 years; or working for in areas having region-based allowances of at least 0.7 for at least 15 years;

- Displaced employees being from 58 years and 03 months to 60 years old and 03 months (for men) and 53 years old and 04 months to 55 years old and 04 months (for women), paying social insurance premiums for at least 20 years.

In addition to the policy of not being deducted from the pension rate due to early retirement, depending on each object, they also receive a salary subsidy. For more details please see here.

Thuy Tram

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