In Vietnam, for employees working in the state, i.e. cadres, civil servants and public employees, do they have the same minimum wage as employees working in the private sector?
In Vietnam, the regulation on regional minimum wages is only applied to the labor force working in the private sector, i.e. private enterprises, but not to the group of cadres, civil servants and public employees working in the public sector, that is, working for the state.
Pursuant to Article 91 of the Labor Code 45/2019/QH14, the subjects of application of the minimum wage are:
– Employees work under labor contracts in accordance with the provisions of the Labor Code.
– Employers according to the provisions of the Labor Code, including enterprises and agencies, organizations, cooperatives, households, and individuals that hire and employ employees to work for them according to the provisions of the Labor Code.
– Other agencies, organizations, and individuals related to the implementation of the minimum wage.
Pursuant to Article 2 of Decree 38/2019/ND-CP, employees working in the Vietnamese state will apply the base salary system. Specifically, the subjects applying the base salary coefficient in Vietnam are:
– Cadres and civil servants from central to district level;
– Commune-level cadres and civil servants;
– Officials in public non-business units;
– People who work under the salary-based labor contract regime;
– People working under the labor contract regime in agencies and units of the Party, the State, socio-political organizations;
– People working in the quota of staff in associations are supported by the state budget for operating expenses;
– Officers, professional soldiers, non-commissioned officers, soldiers and employees, defense officers, contract employees of the Vietnam People's Army.
– Officers, salaried non-commissioned officers, non-commissioned officers, conscripts, public security employees, and contract employees of the People's Police.
– People working in cipher organizations.
– Part-time employees at commune, village and residential groups.
The changes that affect the wages received by working class
For employees signing formal labor contracts working for private enterprises, when the regional minimum wage increases, if the employee is at the old region's minimum wage or lower than the new region's minimum wage, employers will have to increase wages for employees at least equal to the new regional minimum wage.
Currently, Vietnam has 4 different regional minimum wages, from high to low which are region 1 to region 4.
According to the provisions of Article 3 of Decree 38/2022/ND-CP, the regional minimum wage applied to employees in the private sector from July 1, 2022 is:
+ Region I: 4,680,000 VND/month.
+ Region II: 4,160,000 VND/month.
+ Region III: 3,640,000 VND/month.
+ Region IV: 3,250,000 VND/month.
For cadres, civil servants and public employees working in the state sector, because the mechanism of calculating the salary received is based on the salary coefficient, when the base salary increases, all cadres, civil servants and public employees will have their wages increased.
Currently, according to Article 3 of Decree 38/2019/ND-CP, the base salary is 1,490,000 VND/month. In the near future, the base salary will increase to 1,800,000 VND/month from the beginning of 2023 or until the adjustment period in July 2023, so when that Decree officially takes effect, employees in the public sector are expected to receive a significant increase in salary depending on the salary level they are receiving.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
