CIRCULAR

GUIDING THE IMPLEMENTATION OF REGION-BASED MINIMUM WAGE LEVELS FOR LABORERS WORKING FOR ENTERPRISES, COOPERATIVES, COOPERATIVE GROUPS, FARMS, HOUSEHOLDS, INDIVIDUALS AND OTHER AGENCIES, ORGANIZATIONS EMPLOYING LABORERS

Pursuant to the Government’s Decree No. 182/2013/ND-CP dated November 14, 2013, stipulating region-based minimum wage levels for laborers working for enterprises, cooperatives, cooperative groups, farms, households, individuals and agencies, organizations employing laborers;

Pursuant to the Government’s Decree No. 106/2012/ND-CP of December 20, 2012 defining the functions, tasks, powers and organizational structure of the Ministry of Labor, Invalids and Social Affairs;

At the proposal of Director of Labor and Salary Department;

The Minister of Labor - Invalid and Social Affair promulgates Circular guiding the implementation of region-based minimum wage levels for laborers working for enterprises, cooperatives, cooperative groups, farms, households, individuals and other agencies, organizations employing laborers,

Article 1. Scope of regulation and subjects of application

This Circular guides the implementation of region-based minimum wage levels for laborers working under the contract regime and managers of enterprises, cooperatives, cooperative groups, farms, households, individuals and other agencies, organizations employing laborers who are paid salary, including:

1. Enterprises established, organized management and operating under the Law on enterprises (including enterprises with foreign investment capital based in Vietnam that not implement procedures for re-registration as prescribed in point b, clause 2 Article 170 of  the Enterprise Law). 

2. Cooperatives, -UNION-s of cooperatives, cooperative groups, farms, households, individuals and other organizations of Vietnam that employ laborers.

3. Agencies, foreign organizations, international organizations and foreign individuals in Vietnam that employ laborers (except for international treaties which the Socialist Republic of Vietnam is a member otherwise provided for).

The enterprises, agencies, organizations and individuals specified in clauses 1, 2 and 3 of this Article hereinafter collectively referred to as enterprises.

Article 2. The region-based minimum wage level

1. Region-based minimum wage level specified at Clause 1 Article 3 of the Decree No. 182/2013/ND-CP dated November 14, 2013 (hereinafter abbreviated to the region-based minimum wage level) as follows:

a) The level of 2,700,000 VND/month applies to the enterprises operating in areas of region I.

b) The level of 2,400,000 VND/month applies to the enterprises operating in areas of region II.

c) The level of 2,100,000 VND/month applies to the enterprises operating in areas of region III.

d) The level of 1,900,000 VND/month applies to the enterprises operating in areas of region IV.

2. The areas applying region-based minimum wage level are specified in the Appendix issued together with the Government’s Decree No. 182/2013/ND-CP dated November 14, 2013.

3. The areas applying region-based minimum wage level in some specific cases are defined as follows:

a) The area that has the change of name or split, comply with the region-based minimum wage level for the area before changing the name or splitting; in case of areas newly established from the areas with the various region-based minimum wage levels the region-based minimum wage level upon area with the highest region-based minimum wage level shall be applied; in case of establishment of cities directly under provinces from an area or the areas of region IV, then comply with the region-based minimum wage level applying to area of region III.

b) Enterprises operating in the adjacent areas with the various region-based minimum wage levels shall apply the region-based minimum wage level upon area with the highest region-based minimum wage level; enterprises having units, branches operating in the areas with the various region-based minimum wage levels, the unit or branch operating in a certain area, shall apply the region-based minimum wage level of such area.

c) The industrial zone, export processing zone located in the areas with various regional minimum wage levels, enterprises operating in such industrial zone, export processing zone apply the region-based minimum wage level upon area with the highest region-based minimum wage level; where industrial zones, export processing zones having sub-zones located on the areas with the various region-based minimum wage levels, enterprise operating in a sub-zone of certain area, shall apply the region-based minimum wage level of such area.

Article 3. Application of the region-based minimum wage level

1. The region-based minimum wage level prescribed by the Government is the lowest wage level as the basis for enterprises and employees to agree salaries to pay to the employees, but the wage level calculated by month paid to employees who are untrained, do the simplest jobs in the normal working conditions, ensure adequate standard working days in month and complete the labor norms or the works agreed upon, is not less than the region-based minimum wage level stipulated by the Government.

2. The lowest wage level required to pay to the employees who have undergone vocational training (including laborers who are trained by enterprises) must be at least 7% higher than the region-based minimum wage level stipulated by the Government.

The employees who have undergone vocational training include:

- Those who have been granted vocational certificates, vocational diploma, vocational secondary diploma in accordance with provisions of the Decree No.90/CP of November 24, 1993 defining the framework structure of the national education system, system of education and training diplomas and certificates;

- Those who have been granted vocational certificates, vocational diplomas under the provisions of the 1998 Education Law and the 2005 Education Law;

- Those who have been granted certificates under the regular vocational training programs, certificates of vocational primary, vocational secondary diploma, vocational college diploma or have completed vocational training program under the vocational training contract specified in the Law on Vocational Training;

- Those who have been granted vocational diplomas and certificates of foreign training institutions;

- Those who have been trained by enterprises or self-study and examined by enterprises, arranged to do the jobs required to be trained.

3. The region-based minimum wage level prescribed by the Government used as a basis for formulating and adjusting the wage levels in the wage scales, payrolls of the enterprises and wage levels stated in labor contract of employees according to provisions of the labor law as follows

a) For the enterprises that have elaborated and promulgated the wage scales and payrolls shall be based on the region-based minimum wage level prescribed by the Government to review and adjust the wage levels in the wage scales, payrolls, but must satisfy the principles of formulating the wage scales, payrolls in accordance to labor law; to determine and adjust the wage levels, allowances in labor contracts and perform other regimes for the employees in conformable way.

b) For the enterprises that have not elaborated the wage scales and payrolls, shall be based on the region-based minimum wage level prescribed by the Government to calculate the wage levels when formulating wage scales and payrolls of the enterprises, and must satisfy the principles of formulating the wage scales, payrolls in accordance to labor law; to determine and adjust the wage levels, allowances in the labor contracts and perform other regimes for the laborers in conformable way.

c) The adjustment of wage levels in the wage scales and payrolls, or determination of wage levels upon formulating the wage scales and payrolls of enterprises, wage levels and allowances in labor contracts and other regimes for the laborers as prescribed in point a and point b clause 3 this Article shall be agreed by the enterprise, the grassroots trade -UNION- executive committee and employees, but must ensure a reasonably-balanced wage relationship between laborers who are untrained and laborers who have been trained, and laborers with high professional qualifications and high technical skills, between laborers who are recruited newly and laborers who have seniority of working in enterprises.

4. Upon applying the provisions of this Circular, the enterprises must not remove or cut the wage regimes when employees work overtime, work at night, wages or allowances to work in the heavy and hazardous labor conditions, regime of in-kind allowances for the heavy and hazardous occupational titles and other regimes as prescribed by labor law.

Allowances, subsidies, and bonuses provided by enterprises shall comply with the agreements in labor contracts or collective labor agreements or in the Regulation of the enterprises.

5. To encourage enterprises in agreement to apply a minimum wage level that is higher than the region-based minimum wage level prescribed by the Government for use as a basis for implementation of the regulations specified in clause 3 this Article; to pay salaries for employees at higher level in comparison with the provisions in clause 1 and clause 2 this Article.

Article 4. Effect

1. This Circular takes effect on February 01, 2014, the region-based minimum wage levels in Article 2 and regimes specified in this Circular are applied from January 01, 2014.

2. This Circular replaces the Circular No. 29/2012/TT-BLDTBXH of December 10, 2012 of the Ministry of Labor, Invalids and Social Affairs, guiding implementation of region-based minimum wage levels for laborers working for companies, enterprises, cooperatives, cooperative groups, farms, households, individuals and agencies, organizations employing laborers.

3. Funding for implementation of the region-based minimum wage as prescribed in this Circular shall be accounted into the price or cost of production and business of the enterprises.

4. Ministers, Heads of ministerial-level agencies, Heads of Governmental agencies, the chairpersons of the People’s Committees of central-affiliated cities and provinces shall direct, urge and inspect the enterprises for implementation in accordance with provisions of this Circular.

In the course of implementation, any arising problems should be reported to the Ministry of Labor, Invalids and Social Affairs for timely guidance and supplement.