In fact, there are currently many cases where employers intentionally delay the payment of salaries to employees. So, what are the penalties imposed on employers delaying the payment of salaries to employees in Vietnam?
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Vietnam: What are the penalties imposed on employers delaying the payment of salaries to employees? (Illustrative image)
The editorial team at Lawnet would like to address this matter as follows:
1. Enterprises in Vietnam are not allowed to delay payment of salaries to employees for more than 01 month
Under Article 24 Decree 05/2015/ND-CP, the principles of salary payment to employees in Vietnam are stipulated as follows:
- The employee shall be paid directly, fully and punctually.
- In case natural disaster, conflagration or other force majeure events take place, and employers have sought all remedial measures but can not make payment on time as agreed in the employment contract, the payment shall be made within 01 month. The employer shall make additional payment to the employee due to their late payment in the following cases:
+ If such late payment is made within less than 15 days, additional payments are not required;
+ If the late payment is made for 15 days or more, an extra amount shall be at least equal to the arrears of salary multiplied by the ceiling of interest rate for 1-month deposits announced by the State Bank of Vietnam at the time when the payment is made. If the State Bank of Vietnam does not specify the ceiling interest rate, the 1-month deposit interest rate of commercial banks, where businesses and agencies open trading accounts at the time of payment, shall be applied.
Thus, under the above regulations, employees receiving monthly salaries are to be paid monthly or bi-monthly directly, fully, and on time. However, in special cases due to natural disasters, fires, or other force majeure reasons where the employer has taken all remedial measures but cannot pay the salary on time as agreed in the employment contract, the salary delay shall not exceed 01 month.
2. Enterprises delaying the payment of salaries to employees in Vietnam may be fined up to 100 million VND
According to Clause 2, Article 16 of Decree 28/2020/ND-CP, the following fines may be imposed on employers delaying salary payments, not paying, or not paying sufficient salaries to employees as agreed in the employment contract:
- A fine ranging from VND 5,000,000 to VND 10,000,000 to be imposed if the violation involves 01 – 10 employees;
- A fine ranging from VND 10,000,000 to VND 20,000,000 to be imposed if the violation involves 11 – 50 employees;
- A fine ranging from VND 20,000,000 to VND 30,000,000 to be imposed if the violation involves 51 – 100 employees;
- A fine ranging from VND 30,000,000 to VND 40,000,000 to be imposed if the violation involves 101 – 300 employees;
- A fine ranging from VND 40,000,000 to VND 50,000,000 to be imposed if the violation involves 301 or more employees.
However, the above fines apply to individual employers. For organizational employers, the fines are doubled according to Clause 2, Article 5 of Decree 28/2020/ND-CP.
Thus, under the above regulations, enterprises intentionally delaying the payment of salaries to employees in Vietnam can be fined up to 100 million VND. Therefore, enterprises need to ensure timely payment of salaries to employees to avoid penalties as per legal provisions. Meanwhile, employees should be aware to protect their rights.
Ty Na
