VN govt to hike minimum monthly wage on January 1
A new decree issued by the Vietnamese government will lead to an increase in the monthly minimum wage from January 1.
Decree 182 will raise the minimum as high as 2.7 million dong (Bt40,700) per month, depending on region, and will apply to enterprises, cooperatives, household businesses, foreign companies and international organisations operating in Vietnam.
The new arrangement replaces the current decree applied from last December, which also stipulated minimum payments for Vietnamese staff.
The minimum wage will be applied in four different regions in Vietnam with four separate benchmarks determined by living standards in each area.
The thresholds will be 1.9 million dong, 2.1 million dong, 2.4 million dong and 2.7 million dong, accounting for an increase of 250,000-350,000 dong compared with the current minimum wage.
The regulation also stipulates that skilled workers who have received vocational training or a higher level of training must be paid at least 7 per cent more than the regional minimum wage for labourers.
The decree also encourages enterprises to pay their employees more than the region-based minimum wages.
The new decree will take effect on December 31.
Significant jump
Salaries in Vietnam are set to rise 11.5 per cent in 2014, equivalent to 4.9 per cent after inflation, according to a forecast from professional services company Towers Watson Vietnam.
The forecast was based on a survey conducted from June to September by the company, which collected information from about 110,320 incumbents from 312 companies in Vietnam.
According to Towers Watson’s forecast, pay rises in Vietnam and China will be the highest in East Asia after inflation, with salaries across the Asia-Pacific region set to rise by an average 7 per cent next year.
The company predicts that salaries in Hong Kong and Singapore will rise 4.5 per cent, while India will see 11-per-cent increases and Japan 2.3 per cent.
The forecast pay rise for Vietnam next year, however, is still slightly lower than this year’s actual salary increase at 11.7 per cent.
“Given the fact that inflation is expected to be under control, there would be no room for a significant jump in salary increases in 2014,” said Trang Vu, global data services manager at Towers Watson Vietnam.
While the retail sector in Vietnam is expected to see the biggest pay rises at 14.5 per cent next year, the financial-services sector, for the first time in recent years, will see a rise of only 10 per cent, lower than this year’s average increase, the company predicted.
