Labour Regulations in Vietnam

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November 2, 2015

REGIONAL MINIMUM WAGE FROM 2016 ONWARDS

The Government is currently drafting a Decree which will replace Decree No. 103/2014/ND-CP dated 11 November 2014 on the increment of regional minimum wage from 2016 onwards. According to this draft, the estimated minimum wage would be:

Region I: VND 3.500.000
Region II: VND 3.100.000
Region III: VND 2.700.000
Region IV: VND 2.400.000

Thus, the range of regional minimum wage will be expected to be applied from 2016 and this will increase about 12.4% in average in comparison with the current wage stipulating in the Decree No. 103/2014/ND-CP.

CHANGE IN THE BASIS OF SOCIAL INSURANCE OBLIGATION CALCULATION

According to the amended Law on Social Insurance will come into effect on 1 January 2016, the social insurance contribution rate will not change but the base salary for social insurance contribution will be changed.

In particular:

  • From 1 January 2016 until the end of 2017, the monthly salary to calculate the social insurance contribution is the contractual salary and allowances indicated in the labor contract.
  • From 1 January 2018 onwards, the monthly salary to calculate the social insurance contribution is the contractual salary, allowances and other additional amount indicated in the labor contract.

For the foreign employees who have work permits or service certificate/service license granted by the Vietnam authorities will be allowed to participate in compulsory social insurance as stipulated by the Government.

  • However, it’s currently unclear whether the foreign employees must participate in the compulsory social insurance scheme or it will depend on their decision.

Source: http://www.gt.com.vn/download.php?info=publications&submenu=461

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