The Regulation of the minimum wage for employees working under labor contracts

Published on 14 - 06 - 2022
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On 12/6/2022, the Government issued the Decree No. 38/2022/ND-CP stipulating the minimum wage for employees working under labor contracts.

The subjects of application include: Employees working under labor contracts in accordance with the provisions of the Labor Code. Employers under the provisions of the Labor Code include: Enterprises under the provisions of the Enterprise Law; agencies, organizations, cooperatives, households and individuals that hire or employ employees to work for them as agreed. Other agencies, organizations and individuals involved in the implementation of the minimum wage as specified in this Decree.

The minimum wage has increased by 6% on average (equivalent to an increase of VND 180,000 - VND 260,000) as compared to the current minimum wage. Specifically, the Decree stipulates the minimum monthly wages in four regions: Region I will increase by 260,000 VND, from 4,420,000 VND/month to 4,680,000 VND/month. Region II increases by 240,000 VND, from 3,920,000 VND/month to 4,160,000 VND/month. Region III increases by 210,000 VND from 3,430,000 VND/month to 3,640,000 VND/month. Region IV increases by 180,000 VND from 3,070,000 VND/month to 3,250,000 VND/month.

Regarding the minimum hourly wage, the Decree also stipulates the minimum hourly wages according to 4 regions: Region I is 22,500 VND/hour, region II is 20,000 VND/hour, region III is 17,500 VND/hour, region IV is 15,600 VND/hour.

The application of the geographical area is determined by the place of operation of the employer.

The Decree also clarifies that the minimum monthly salary, which is the lowest salary as a basis for negotiating and paying salaries for employees applied the monthly salary form, ensuring the salary according to the job or title of the employees who work full normal working hours in a month and complete the agreed labor norms or work, must not be lower than the monthly minimum salary.

The minimum hourly wage is the lowest wage as the basis for negotiating and paying wages to employees who are applied the form of hourly payment, ensuring the salary according to the job or title of the employee working in an hour and complete the agreed labor norm or work, that is not less than the hourly minimum wage.

For employees who are applied the form of weekly or daily wage or product or contractual wage, the wage of these forms of payment, if converted by monthly or hourly, must not be lower than the monthly or minimum hourly wage.

This Decree takes effect from July 1, 2022.

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