A decree on regional minimum wages of employees in Vietnam working in May 2022 is coming soon

Shall have Decree on region-based minimum wage level of employees in May 2022?

Prior to, at the second meeting of the National Wage Council, presided over by Mr. Le Thanh Deputy Minister of Labor, War Invalids and Social Affairs, concurrently being Chairman of the National Wage Council, to discuss the issue of region-based minimum wage increase for laborers in enterprise. The national wage Council already agreed to increase the region-based minimum wage level by 6% compared with the current region-based minimum wage level. This increase shall apply as from July 1, 2022 if it is approved by the Government.

On May 3, 2022, in the Government's regular meeting held in April 2022, the Government requested the Ministry of Labor, War Invalids and Social Affairs to submit a Decree on region-based minimum wages for employees working under employment contracts in May 2022 to the Government for promulgation. This Decree is specifically regulated in the Government's Resolution No. 63/NQ-CP dated 2022 as follows:

The Ministry of Labor, War Invalids and Social Affairs shall take charge and cooperate with ministries, agencies and local governments in:

08/2022/QD-TTg dated March 28, 2022 of the Prime Minister.

- Promptly submit a Decree on regional minimum wage rates applied to employees working under labour contracts in May 2022 to the Government for promulgation.

- Promulgate the Plan and preside over and cooperate with relevant ministries, agencies and localities in organizing the celebration of 35-year celebration of war invalids and martyrs with the aim of ensuring solemnity, meaning, practicality, efficiency and relevance to the reality.

In May 2022, there shall be a Decree on region-based minimum wage rates for employees working under labour contracts at enterprises. This is a significant signal for employees, which was affected by Covid-19 where the region-based minimum wage has not been implemented according to the objectives set out in the Resolution No. 27/NQ-TW dated 2018 on the wage reform policy. Thus, this point of time proposing the increase of region-based minimum wage is absolutely reasonable. The wage increase in the region-based minimum wage shall, apart from helping laborers overcome the current difficult period, contribute to promoting quick economic restoration.

A decree on regional minimum wages of employees in Vietnam working in May 2022 is coming soon

From July 01, 2022, the region-based minimum wage level applying to employees working in enterprises shall be changed accordingly?

- For normal employees:

According to the increase of 6% of the new region-based minimum wage level announced by the National Wage Council and the region-based minimum wage level specified in Article 3 of the Decree 90/2019/ND-CP, the region-based minimum wage level of employees working for enterprises shall be changed as follows:

+ The level of 4,680,000 VND/month applies to enterprises operating in localities of region I.

+ VND 4,160,000/month, applicable to enterprises operating in localities of region II.

+ For enterprises operating in region III: VND 3,640,000/month.

+ VND 3,250,000/month, applicable to enterprises operating in localities of region IV.

- For trained laborers:

Assume that the employer can receive at least 7% of the region-based minimum wage level as follows:

+ For enterprises located in region I: VND 5.010.00/month.

+ VND 4,450,000/month, applicable to enterprises operating in localities of region II.

+ VND 3,900,000/month, applicable to enterprises operating in localities of region III.

+ VND 3,480,000/month, applicable to enterprises operating in localities of region IV.

If the Government, through its proposal to increase the region-based minimum wage level by 6% of the current region-based minimum wage level, the above wage level will be the lowest wage level paid by an employee working under a labor contract at the enterprise.

Khanh Linh

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