Recently, the Government of Vietnam has proposed to increase the statutory pay rate in 2020 to 1.6 million VND/month in the Report on the assessment of the implementation of the State budget for 2019, State budget estimates, and the plan for allocation of the Central budget for 2020. The majority of opinions in the Finance and Budget Committee have agreed with this proposal.
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Compared to the statutory pay rate increases of previous years, which ranged from VND 60,000, VND 90,000/month to VND 100,000/month, the 2020 statutory pay rate increase could be the highest at VND 110,000/month. With this statutory pay rate increase, allowances calculated based on the statutory pay rate for officials and public employees will also rise significantly, arguably the highest increase ever, including the first-time allowance for officials and public employees working in areas with particularly difficult socio-economic conditions.
To be specific, according to Decree 76/2019/ND-CP effective from December 1, 2019, individuals specified in Article 2 of this Decree, upon their first assignment to agencies, organizations, or units in areas with particularly difficult socio-economic conditions, will receive a first-time allowance equivalent to 10 months' statutory pay rate as of the assignment date in these areas.
Therefore, if the proposed increase of the statutory pay rate to VND 1.6 million/month by the Government of Vietnam is approved by the National Assembly, the first-time allowance for officials and public employees working in particularly difficult areas will be VND 16 million (equivalent to 10 months' statutory pay rate). Currently, this allowance is only VND 14.9 million.
In cases where family members also move to work in areas with particularly difficult socio-economic conditions, in addition to the first-time allowance, they will receive additional allowances as follows:
- Ticket and baggage expenses for family members traveling together, calculated based on the actual fare and baggage charge of public transportation or paid according to the fixed rate based on the actual kilometers traveled multiplied by the unit cost of conventional public transport (trains, boats, passenger cars).
- Family allowance equivalent to 12 months' statutory pay rate (equivalent to VND 19.2 million).
Note: These allowances are paid by the agencies, organizations, and units in the areas with particularly difficult socio-economic conditions where the recipients are working. They are paid immediately upon assignment and only once during the total actual working time in such areas.
Nguyen Trinh
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