Instruction on determining the time and salary to calculate the latest downsizing allowance in Vietnam

Instruction on determining the time and salary to calculate the latest downsizing allowance in Vietnam (Internet image)

1. Instruction on determining the time and salary to calculate the latest downsizing allowance in Vietnam

- Current salary is the salary of the month immediately preceding the downsizing.

The calculated monthly salary includes:

+ Salary according to rank, grade, position, title, professional title, or salary as agreed in the labor contract or the salary of the company manager;

+ Position allowances, excess seniority allowances, seniority allowances, salary, and reserved difference (if any) in accordance with the law on salary.

- Average salary is the average monthly salary of the last 5 years (60 months) before downsizing.

Particularly for cases with less than 5 years (less than 60 months) of work with social insurance premiums, the average monthly salary of the entire working period.

- The time used as a basis for calculating full age to enjoy early retirement benefits and policies is the 1st day of the following month adjacent to the subject's birth month; in case the subject's file does not specify the date of birth in the year, the date of January 1 of the subject's birth year shall be taken.

- The time for calculating the allowance specified in Articles 5, 6, 7 and 8 of Decree 29/2023/ND-CP is the total working time with compulsory social insurance payment (according to each person's social insurance number) but have not yet received severance allowance or lump-sum social insurance benefits or have not enjoyed the service or demobilization regime.

If the total benefit calculation period has odd months, it shall be rounded according to the principle: from 01 month to full 06 months, it shall be counted as 1/2 year and receive benefits equal to the allowance level of 1/2 year; from over 06 months to less than 12 months, it is counted as 01 year.

- The time to calculate the early retirement allowance specified in Articles 5 and 8 of Decree 29/2023/ND-CP, if there are odd number of months, it shall be rounded according to the principle: from 01 month to full 06 months shall be counted as 1/2 year and receive a subsidy equal to the allowance level of 1/2 year; from over 06 months to less than 12 months is counted as 01 year.

(Article 10 of Decree 29/2023/ND-CP)

2. Principles of downsizing in Vietnam

- Ensuring the leadership of the Party, and promoting the supervisory role of socio-political organizations and the people in the process of downsizing.

- Associating the downsizing of the payroll with the organizational arrangement of the apparatus towards a streamlined, effective, and efficient operation and restructuring, improving the quality of the contingent of cadres, civil servants, and public employees according to employment positions, consistent with the autonomy mechanism of agencies, organizations, and units.

- Ensuring the principles of democratic centralism, objectivity, fairness, publicity, transparency, and compliance with the law.

- Ensuring payment of payroll reduction regimes and policies in a timely and complete manner in accordance with law, ensuring efficient use of the state budget.

- The head must be responsible for the results of downsizing in the agency, organization, or unit assigned to manage according to his/her competence.

- Subjects of downsizing if they are elected or re-recruited into agencies, organizations, and units receiving salaries from the state budget within 60 months from the date of downsizing, the subsidy amount received must be returned to the agency, organization, or unit that has paid the allowance.

(Article 3 of Decree 29/2023/ND-CP)

Decree 29/2023/ND-CP takes effect from July 20, 2023; the regimes and policies in Decree 29/2023/ND-CP shall be applied until the end of December 31, 2030.

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