Will removing allowances upon salary reform when reforming wages reduce the salaries of officials and civil servants in Vietnam?

Will removing allowances upon salary reform when reforming wages reduce the salaries of officials and civil servants in Vietnam? (Internet image)

Regarding this issue, LawNet answers as follows:

1. 05 allowances are abolished for cadres, civil servants, and public employees when implementing salary reform in Vietnam

According to point d, clause 3.1, subsection 3, Section II, Resolution 27-NQ/TW of 2018 regulating the rearrangement of current allowance regimes, 05 allowances for cadres, civil servants, and public employees were abolished when implementing salary reform, including:

(1) Professional seniority allowance (except military, police, and cipher to ensure salary correlation with officials and civil servants);

(2) Leadership position allowances (paid by leadership positions in the political system);

(3) Allowances for party work and socio-political organizations;

(4) Civil service allowances (included in the basic salary);

(5) Toxic and dangerous allowances (because working conditions with toxic and dangerous elements have been included in occupational allowances).

Thus, when implementing salary reform, allowances that are cut for civil servants and public employees who do not hold leadership positions include: seniority allowances; allowances for party work and socio-political organizations; civil service allowances; and toxic and dangerous allowances.

2. Will removing allowances upon salary reform when reforming wages reduce the salaries of officials and civil servants in Vietnam?

Resolution 27-NQ/TW of 2018 clearly states that the salary reform will design a new salary structure including: Basic salary (accounting for about 70% of the total salary budget) and allowances (accounting for about 30% of the total salary budget). Additional bonus (bonus fund equals about 10% of the year's total salary fund, excluding allowances).

Besides, according to Point d, Clause 3.1, Section II, Resolution 27-NQ/TW of 2018, in addition to cutting allowances, the salary reform policy also incorporates allowances and continues to apply a number of other allowances.

It is understandable that when implementing salary reform, allowances will not be completely eliminated. Instead, appropriate adjustments will be made, ensuring that allowances account for about 30% of the total salary budget.

At the same time, at point b, clause 3.1, subsection 3, Section II, Resolution 27-NQ/TW of 2018 stipulates:

Develop and promulgate a new payroll system based on job position, title, and leadership position to replace the current payroll system; change the old salary to the new salary, ensuring it is not lower than the current salary.

Accordingly, a new salary schedule for cadres, civil servants, and public employees is established as follows:

+ Develop a position salary table applicable to cadres, civil servants, and public employees holding leadership positions (elected and appointed) in the political system from central to commune level according to the principles:

(1) Position salary must reflect hierarchy in the political system; If a person holds a leadership position, he or she will receive a salary according to that position. If a person holds many positions, he or she will receive the highest salary for the position; those holding equivalent leadership positions will receive the same salary; The position salary of a superior leader must be higher than the position salary of a subordinate leader;

(2) Regulating a salary level for each equivalent position; Do not classify ministries, branches, departments, committees, and equivalents at the Central level when building the salary table for positions at the Central level; does not differentiate between different salary levels for the same leadership position according to the classification of local administrative units, but is implemented through allowances. The classification of equivalent leadership positions in the political system to design the position salary schedule is decided by the Politburo after reporting to the Central Executive Committee.

+ Develop a professional and professional salary table according to civil servant ranks and civil servant professional titles, applicable generally to civil servants and public employees who do not hold leadership positions; Each civil servant rank and professional title has many salary levels according to the principle:

The same level of job complexity means the same salary;

Working conditions are higher than normal, and job incentives are implemented through job-based allowances;

Rearrange the rank groups and number of ranks in civil servant ranks and civil servant professional titles, and encourage civil servants and public employees to improve their professional qualifications and skills.

Appointment to civil servant ranks or public employee professional titles must be linked to the job position and structure of civil servant ranks and public employee professional titles implemented by agencies, organizations, and units managing civil servants and public employees.

Thus, cutting some allowances when reforming wages will not reduce wages. This is just one of the ways to adjust the allowance fund to suit the new salary structure.

3. Expected time to implement salary reform in Vietnam?

It is expected that at the 6th session of the 15th National Assembly in October 2023, the Government will present a roadmap and salary reform plan to the National Assembly.

Recently, speaking at the closing of the Vietnam Socio-Economic Forum 2023, the Chairman of the National Assembly also emphasized the early implementation of fundamental wage policy reform in 2024. This is also a boost for the labor market, contributing to stimulating domestic consumption.

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