Labour federation calls for higher wages

The federation stood firm by the argument that the country's workers were entitled to a minimum wage increase at least equal to the previous year, roughly 14%. They said that, especially with positive signs in the economy's first nine months of this year, wages should reflect next year's promising outlook.

The 14.4% increase was also justified by pointing to this year's 0.5% year-on-year increase in GDP growth, projected to be 6.5%. VGCL argued that wages should increase along with the GDP. For comparison, in 2013, GDP grew only by 5.4% and yet wages increased by 17.3%.

In addition, 19.9% of the country's workers said they could not meet basic living standards with their current wages, 72% said they could barely make ends meet and 8.0% said they managed very little savings.

The survey also pointed out that 62% of workers had to work over-time shifts to afford basic living needs and that it prevented them from participating in cultural, relaxation and self-improvement activities.

Regarding employers' ability to pay, VGCL said tax agency reports indicated that a majority of employers across the country were already paying wages at 20-40% higher than the minimum wage. Many, they argued, therefore wouldn't be affected by the increase.

"A large number of employers were already paying workers between VND4.4 million to VND4.9 million (US$195-220) in monthly wages in big cities such as Ha Noi and HCM City- that's higher than our proposed increase," said VGCL Vice President Mai Duc Chinh at a VGCL meeting in August.

VGCL also urged businesses to invest in technology and improve management capacity to increase productivity, rather than using low-productivity as an excuse to delay minimum wage increases.

"While workers do play a key role in improving productivity, it's not reasonable to expect them to help if minimum wage does not allow them to meet minimum living standards," said VGCL's proposal submitted to the Prime Minister.

The proposal also said that the 14.4% increase would help the VGCL and the Ministry of Labour, Invalids and Social Affairs honour agreements with the International Labour Organisation.

The National Wage Council must resettle the matter after the VGCL and the Vietnam Chamber of Commerce and Industry (VCCI), which represents the business sector's interests, failed to reach a consensus after multiple meetings.