Regional Minimum Wages to Increase Across Vietnam 2024

Vietnam’s Ministry of Labor, War Invalids, and Social Affairs has drafted a decree to regulate minimum wages for employees working under employment contracts. In this draft, the Ministry proposes a six percent increase in the minimum wage, effective July 1, 2024. Employees will receive enhanced benefits once this regional minimum wage hike is officially implemented on the proposed date.

Minimum wage increase

When the minimum wage increases, employees receive a higher monthly salary and enjoy additional benefits. The Ministry of Labor, War Invalids, and Social Affairs has drafted a decree to raise the regional minimum wage by six percent, starting July 1, 2024.

According to Article 90 of the Employment Code (Number 45/2019/QH14), employee salaries encompass base pay, salary allowances, and other benefits. The base pay for any job or position must not exceed the minimum wage, while allowances and other benefits are discretionary. Therefore, the minimum compensation employees should receive is the regional minimum wage.

As reported by the Government Information, the Ministry is finalizing this draft decree to specifically set the minimum wages for employees working under employment contracts. The proposed monthly regional minimum wages are as follows:

• Region I: 4,960,000 VND (US$194) per month;
• Region II: 4,410,000 VND (US$173) per month;
• Region III: 3,860,000 VND (US$151) per month; and
• Region IV: 3,450,000 VND (US$135) per month.

Compared to the current rates, these proposed wages represent an increase ranging from 200,000 VND (US$7.84) to 280,000 VND (US$10.98) per month.

Increase in wages for laid-off workers

Here’s how employees are compensated when work stoppages occur. If the stoppage is due to the employee’s fault, they will not be paid. However, the pay structure changes if the stoppage is caused by factors beyond the employer’s control—such as power or water cuts, natural disasters, fires, disease outbreaks, enemy sabotage, or government-ordered relocations.

For stoppages lasting 14 working days or less, the pay must be at least the minimum wage, as agreed upon by both parties. If the stoppage extends beyond 14 working days, the pay rate for the first 14 days cannot be less than the minimum wage, with subsequent pay determined by mutual agreement.

 

Increase in the minimum wage when transferring jobs

When an employee is reassigned to a different job than specified in their contract, they will be paid according to the new job’s salary. If the new job pays less, the employee will retain their original salary for 30 working days. The new job’s salary must be at least 85 percent of the original salary and cannot be lower than the minimum wage.

When an employee transitions to a new role, they will receive the new job’s salary, which must meet or exceed the minimum wage. As the regional minimum wage increases, the minimum wage for transferred jobs must also be adjusted accordingly.

Compensation for damage to company property

According to Paragraph 1 of Article 129 of the 2019 Manpower Code, if employees damage tools, equipment, or cause any other damage to the employer’s property, they must compensate for the losses as per legal provisions or the employer’s regulations. If the damage is minor and valued at less than 10 months’ regional minimum wage for the area where the employee works, the compensation is capped at up to three months’ salary.

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