In 2020, there will be 05 labor and wage policies that come into effect, directly impacting all officials and public employees as well as workers. Specifically, they include:
Article table of contents
Illustrative image
1. Increase the statutory pay rate to 1.6 million VND/month from July 1, 2020
Resolution 86/2019/QH14 on the state budget estimate for 2020 was passed by the XIV National Assembly at its 8th session on November 12, 2019.
The National Assembly authorizes the Government of Vietnam to implement an adjustment to increase the statutory pay rate from 1.49 million VND/month to 1.6 million VND/month, and concurrently adjust pensions, social insurance allowances, and monthly subsidies as prescribed (for subjects ensured by the State budget) as well as preferential allowances for revolutionary contributors to increase by the same statutory pay rate from July 1, 2020.
In addition, the National Assembly also requires the Government of Vietnam to continue implementing the current policies on creating sources for wage reform in conjunction with thorough savings, streamlining the apparatus, reducing staff, and enhancing the financial autonomy of public service providers. Furthermore, from 2019, allocate 40% of the realized increase in central budget revenue and the realized increase compared to the local budget estimate to create sources for wage reform in 2020 and accumulate for the period 2021-2025.
2. Regional minimum wage increase up to 240,000 VND/month
Decree 90/2019/ND-CP stipulates regional minimum wage levels for employees working under labor contracts, effective from January 1, 2020.
Starting from January 1, 2020, the regional minimum wage in 2020 will increase from 150,000 VND/month to 240,000 VND/month depending on each region compared to the 2019 regional minimum wage. Specifically::
- Region I: 4,420,000 VND/month, currently 4,180,000 VND/month (increase of 240,000 VND/month).
- Region II: 3,920,000 VND/month, currently 3,710,000 VND/month (increase of 210,000 VND/month).
- Region III: 3,430,000 VND/month, currently 3,250,000 VND/month (increase of 180,000 VND/month).
- Region IV: 3,070,000 VND/month, currently 2,920,000 VND/month (increase of 150,000 VND/month).
Moreover, from January 1, 2020, there will be changes in regional classifications for applying regional minimum wages. Specifically::
- Dong Phu district of Binh Phuoc from Region III to Region II, Ben Tre City from Region IV to Region II, and Chau Thanh district of Ben Tre from Region III to Region II.
- Adding the following areas from Region IV to Region III: Cua Lo town and the districts of Nghi Loc, Hung Nguyen in Nghe An; Dong Son and Quang Xuong districts in Thanh Hoa; and the districts of Ba Tri, Binh Dai, Mo Cay Nam in Ben Tre.
3. From January 1, 2020, banking officials have the highest salary coefficient up to 8.0
Circular 12/2019/TT-NHNN stipulates the titles, rank codes, professional standards, and salary arrangements for banking officials, effective from January 1, 2020.
Banking officials include 6 titles: Senior Inspector, Principal Inspector, Inspector, Warehouse Keeper, Treasurer, and Banking Examiner.
Of these, the Senior Inspector is classified as A3 category 1 official (A3.1) with the highest salary coefficient up to 8.0. From July 1, 2020, with the adjustment in the statutory pay rate for 2020 to 1.6 million VND/month, the salary for this group will increase to 12.8 million VND/month (current salary being 11.92 million VND/month).
4. No recruitment for the elementary accountant rank from January 1, 2020
This noteworthy content is in Circular 77/2019/TT-BTC which stipulates the rank codes, professional standards, and salary arrangements for officials in the accounting, tax, customs, and reserve sectors, effective from January 1, 2020.
Specifically, according to this Circular, from January 1, 2020, management agencies will not recruit officials for the elementary accountant rank, nor convert officials to the elementary accountant rank.
For officials currently holding the elementary accountant rank (code 06.033), they will be transferred to new ranks before January 1, 2020 as follows:
- Officials with a college degree or higher, meeting the standards and conditions for the intermediate accountant rank, will be considered for appointment to the intermediate accountant rank;
- If they do not have a college degree or higher, they will continue to enjoy the current salary coefficient for a period of 6 years from January 1, 2020.
Within the 6-year period from January 1, 2020, agencies using officials are responsible for arranging training for officials to meet the standards of the accounting professional ranks as stipulated in Circular 77.
5. From July 1, 2020, teachers’ salaries will be paid according to job positions
Education Law 2019 was passed by the XIV National Assembly on June 14, 2019 and officially comes into effect from July 1, 2020. Article 76 Education Law 2019 stipulates the salaries of teachers as follows:
Article 76. Salaries
Teachers are paid in accordance with their job positions and professional work; and are given priority for special job allowances as prescribed by the Government of Vietnam.
Teachers will be paid according to their job positions and the complexity of the profession starting in 2020. This new wage policy embodies the spirit of wage policy reform according to Resolution 27/NQ-TW of the Central Executive Committee.
Nguyen Trinh
