Legal Counselling

Vietnam: Guidance on determination of the planned average pay rate in State-owned enterprises

17:27, 30/10/2016

This is a notable content specified in Circular No. 31/2016/TT-BLĐTBXH of the Ministry of Labor, War Invalids and Social Affairs of Vietnam, providing guidance on management of employees, salary, remuneration and bonus by organizations that are incorporated and operate as wholly state-owned single-member limited liability companies under the Law on Securities.

According to Circular No. 31/2016/TT-BLĐTBXH of the Ministry of Labor, War Invalids and Social Affairs of Vietnam, for the purpose of determination of the planned average pay rate according to the average productivity and profit, the average labor productivity shall depend on the total revenue. To be specific:

The planned average labor productivity shall be determined according to the following function:

Where:

Wkh: Planned average labor productivity

ΣTkh: Total estimated revenue

Lbqkh: Estimated averaged number of employees, calculated according to clause 1 of the Annex to Circular No. 26/2016/TT-BLĐTBXH.

The annual realized average labor productivity (or of the immediately preceding year) is determined according to the following function:

Where:

Wth: Annual average realized labor productivity (or of the immediately preceding year).

ΣTth: Total annual realized revenue (or of the immediately preceding year).

Lbqth: Actual average number of employees in the year (or the immediately preceding year), calculated according to clause 1 of the Annex to Circular No. 26/2016/TT-BLĐTBXH.

View more relevant provisions at Circular No. 31/2016/TT-BLĐTBXH of the Ministry of Labor, War Invalids and Social Affairs of Vietnam, effective from December 10, 2016.

- Thanh Lam -

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