Determination of the Salary Fund for VNPT and State-Owned Corporations in 2020

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Decree 20/2020/ND-CP stipulates that the actual salary fund for employees and the Executive Board at state-owned economic groups and corporations is determined based on the contractual unit price multiplied by the target spec for the contractual unit price as per Article 7 of this Decree. It ensures that the average salary increase is lower than the average labor productivity increase, and the actual profit is not lower than the average actual profit of the 2018-2019 period.

For companies with actual profits exceeding the average profit of the 2018 - 2019 period, additional salary fund (accounted into the cost) can be calculated based on the principle that for every 1% profit exceeded, an additional maximum of 2% of the salary fund can be calculated, but not exceeding 20% of the exceeded profit and not more than 2 months of actual salary.

For cases where actual profits are lower than the average of the 2018 - 2019 period, the salary fund must be reduced according to one of two methods chosen by the company: reduce by percentage (%) or based on the gap between the actual profit and the average profit of the 2018-2019 period. The maximum reduction is not more than 2 months of salary and ensures that the actual salary fund is not lower than the salary fund calculated according to the average salary in the labor contract.

Finally, based on the actual salary fund and the salary advances already paid to employees, the company determines the remaining salary fund to be enjoyed. In case advances and expenditures exceed the actual salary fund, it must be refunded from the salary fund of the subsequent year.

More details can be found in: Decree 20/2020/ND-CP, effective from April 1, 2020.

Thu Ba

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