New regulations on the distribution of financial revenue sources for grassroots trade unions in Vietnam

New regulations on the distribution of financial revenue sources for grassroots trade unions in Vietnam​ (Image from the Internet)

The Presidium of the Vietnam General Confederation of Labor issued Decision 1408/QD-TLD on August 1, 2024, regarding the Financial Management, Trade Union Assets, Collection, Distribution of Revenue, and Rewards and Penalties for Financial Submissions of Trade Unions.

New regulations on the distribution of financial revenue sources for grassroots trade unions in Vietnam

According to Article 28 of the Regulations issued with Decision 1408/QD-TLD on August 1, 2024, the distribution of financial revenue for grassroots trade unions is as follows:

- Grassroots trade unions are allowed to use 70% of the total trade union member fee revenue and 75% of the total trade union fund revenue.

The trade union member fees collected in excess of the provisions in Article 30 of this Regulation and other sources of revenue are to be retained 100% for use by the grassroots trade unions.

- Submit the union fund to higher-level trade union authorities when grassroots trade unions are relegated to collect trade union funds.

Grassroots trade unions relegated to collect trade union funds must submit to the higher-level trade union (the level relegated with financial union management) a percentage of the total trade union fund revenue and total trade union member fee revenue as stipulated in Clause 1, Article 28 of the Regulations issued with Decision 1408/QD-TLD on August 1, 2024. Throughout the year, submissions must align with the budget estimate. Upon finalizing, submissions must align with the finalized revenue.

- Allocate trade union funds for grassroots unions not relegated to collect trade union funds.

Higher-level trade unions relegated to collect trade union funds, upon receiving funds from agencies, organizations, or enterprises, must allocate to grassroots trade unions (units submitting trade union funds) within 5 working days.

- For agencies, organizations, units, or enterprises that have not yet established grassroots trade unions: Higher-level trade unions relegated to collect trade union funds, upon receiving funds from agencies, organizations, or enterprises, shall utilize them according to a percentage of the total trade union fund revenue as guided annually by the Presidium of the General Federation to spend on promoting, expanding membership, establishing grassroots trade unions, signing collective labor agreements, and protecting and caring for laborers in these units. At the end of the year, unused funds for the aforementioned activities must be managed, monitored, and returned to the grassroots trade union when the unit establishes a trade union.

In cases where agencies, organizations, or enterprises that have not established grassroots trade unions are bankrupt or dissolve, the trade union fund revenue shall be recorded as an increase in financial revenue at the higher-level trade union authorized to collect.

Regulations on the delegation to collect and collecting methods for trade union funds in Vietnam

According to Article 26 of the Regulations issued with Decision 1408/QD-TLD on August 1, 2024, trade union funds paid by agencies, organizations, or enterprises to trade union organizations are regulated by the Law on Trade Unions 2012 and the Government of Vietnam's detailed decree on trade union financials. The General Federation uniformly collects and delegates the collection of trade union funds as follows:

- For administrative units funded entirely or partially by the Central or local budgets: Immediate superior grassroots trade unions, provincial, city, and equivalent Labor Federations collect from units they directly manage and notify contributors of the trade union funds to comply; and simultaneously notify the Provincial, City State Treasury, or district, provincial city subordinate State Treasury to coordinate collection.

- For agencies, organizations, enterprises, and public service providers not benefiting from State budget operations having trade unions or not yet having established one: Provincial, city, and equivalent Labor Federations directly collect or delegate to immediate superior grassroots trade unions to collect and notify contributors to comply.

- Provincial, city, and equivalent Labor Federations; immediate superior grassroots trade unions delegate the collection of trade union funds to grassroots unions for units subject to Decree 168/2016/ND-CP regulating forest contracts, plantations, and water surface areas in special-use forest management boards, protection forests, and State-owned sole member agriculture and forestry companies.

- All trade union levels must issue a decision granting collected delegation with a list of contributors to comply by lower levels.

- Methods for collecting trade union funds for organizations, enterprises, and public service providers not benefiting from State budget operations have specific guidance from the General Federation.

Decision 1408/QD-TLD comes into effect from December 1, 2024.

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