2019 regional minimum wage discussed

The change will affect about ten million people who are working with labour contracts in non-State enterprises. 

At the meeting, the Vietnam General Confederation of Labour (VGCL), which represents employees, proposed an increase of 8 percent in the regional minimum salary while the Vietnam Chamber of Commerce and Industry, reprsentating businesses, asked for the wage to remain unchanged in 2019.

Addressing the event, Deputy Minister of Labour, Invalid and Social Affairs cum Chairman of the council Doan Mau Diep said that according to Resolution 27-NQ/TW on salary reform that the Communist Party of Vietnam Central Committee issued in May 2018, the State would gradually not intervene in the wage policy of enterprises but promote negotiations between employers and employees.

He said that from now until 2020, regional minimum wage must be adjusted to ensure minimum living conditions for employees, especially those who are paid the least.

“When negotiating minimum wage changes, factors such as GDP, labour productivity, salary on labour market and employers’ budget must be taken into account,” he said.

According to VCCI Vice Chairman Hoang Quang Phong, most domestic and foreign employers told the chamber that next year is not the right time to adjust the minimum wage as they want to increase their financial capacity or spend funds – which they can arrange – on training and improving employees’ skills to better meet job requirements and increase productivity.

“The minimum wage should be increased then, in the further future,” Phong said.

Meanwhile, VGCL Vice President Mai Duc Chinh said the 8-percent increase proposed by his agency is suitable as Vietnam’s gross domestic product (GDP) in the first half of this year grew more than 7 percent compared with the same period of last year.

“The economic growth is notable and labourers deserve benefiting from the economic development,” he said.

He also said that Government decided the 7-percent increase for employees working in State organisations and enterprises this month, despite its tightened budget.

A recent survey by the VGCL showed that the monthly minimum wage could cover about 92 percent of minimum living conditions for employees while Vietnam targeted that by 2020, the minimum wage could ensure their minimum living conditions.

Currently, the minimum wage is applied for four different regions in Vietnam as follows: Region I:  3.98 million VND (189 USD); Region II: 3.53 million VND (168 USD); Region III: 3.09 million VND (147 USD) and Region IV: 2.76 million VND (131 USD). The highest rate covers urban parts of Hanoi, Hai Phong, HCM City, Dong Nai and Ba Ria - Vung Tau.

The 2018 regional minimum wage is 6.5 percent higher than that of 2017, equal to 180,000-230,000 VND (8-10 USD) a month.