Circular No. 01/LDTBHH guiding the implementation of Decision No. 217-HDBT of the Council of Ministers on labor, wages, and social affairs.

CIRCULAR

OF THE MINISTRY OF LABOUR - INVALIDS AND SOCIAL AFFAIRS NO. 01/LĐ-TBXH
DATE 9 OCTOBER 1988 GUIDING IMPLEMENTATION OF RESOLUTION 217/HĐBT OF THE STATE COUNCIL ON LABOUR WAGES AND SOCIAL ISSUES

Pursuant to Part VIII on labour - wages and social issues of the regulations on policies for socialist planning and business accounting reform for state-owned enterprises as stipulated in Decision No. 217/HĐBT dated November 14, 1987 of the State Council, the Ministry of Labour - Invalids and Social Affairs guides implementation as follows:

I- LABOUR CONTRACT REGIME (ARTICLE 47)

From now on, state-owned enterprises shall gradually implement the transition from the recruitment regime into state staff to the labour contract regime.

- For new recruits from now onwards (including university, college, vocational high school graduates, and management cadres), the labour contract regime shall be implemented.

- For workers currently employed under the old labour contract regime or temporary recruitment, if the enterprise still has a need for their services, they shall sign and implement the labour contract regime according to this circular.

- For current employees within the existing staff quota, the enterprise shall, based on specific conditions, implement the transfer of individuals, units, or the entire workforce (excluding directors, deputy directors, and chief accountants) to the labour contract regime.

In cases 2 and 3 mentioned above, the previous working time will be accumulated.

1- CONTENT OF LABOUR CONTRACT

A labour contract is a written agreement between the enterprise director and the worker regarding obligations and benefits, responsibilities and authorities of both parties during the labour process, signed by the director and the worker according to the model attached to this circular. In the contract, the worker commits to completing the work agreed upon in the contract in terms of quantity and quality, adhering to labour discipline, enterprise rules, safety procedures, and other regulations of the enterprise; the enterprise director commits to ensuring necessary conditions for the worker to complete the work agreed upon in the contract, ensuring workplace safety, hygiene, labour protection, and other state policies for workers.

2- FORM OF LABOUR CONTRACT

Depending on the nature of production and business, the enterprise director and the worker may agree to sign the following forms of labour contracts:

- Indefinite-term labour contract, applicable to stable long-term jobs that require workers with qualifications, technical expertise, skills, and experience accumulated through labour. This form mainly applies to those who have completed training courses or traditional trades (without formal education) with high technical skills and proficiency that the enterprise needs.

- Fixed-term labour contract, applicable to jobs with a defined completion time ranging from one to five years.

For these two types of labour contracts, the enterprise director and the worker shall review the contract's implementation annually to agree on its continuation or termination.

- Job-specific or project-based labour contract under one year.

3- STANDARDS FOR WORKERS TO SIGN LABOUR CONTRACTS

- Having citizen rights and voluntarily willing to work.

- Having qualifications suitable for the enterprise's job requirements.

- Being in good health and at least 18 years old.

It is prohibited to employ workers under 18 years old for heavy, hazardous work that affects physical and mental development; for other jobs, the enterprise may employ workers under 18 years old, but must obtain the consent of the People's Committee of the district where the enterprise is located.

4- PROCEDURE FOR SIGNING LABOUR CONTRACTS

- Before signing the labour contract, the enterprise director is responsible for:

+ Introducing the worker to understand the content and requirements of the job; situations where temporary reassignment to other jobs or locations may occur, the duration of the contract, working conditions, safety procedures, labour discipline, and enterprise rules; wage levels and payment methods, bonuses; other policies and benefits that the worker will enjoy.

+ Conducting a health check, assessing professional qualifications, organizing a trial period. The trial period shall not exceed thirty days. The wage during the trial period shall be agreed upon by the director and the worker.

- The worker is responsible for submitting to the enterprise an application for employment; a resume certified by the People's Committee of the commune, ward, town where they reside; a health certificate; academic or professional qualification certificates. For those already holding a labour record, only the employment application and health certificate need to be submitted to the enterprise.

- The labour contract shall be signed according to the prescribed model, bearing signatures of both parties, creating two copies, one retained by the enterprise director and one by the worker.

5- POLICIES AND REGIMES FOR WORKERS EMPLOYED UNDER THE LABOUR CONTRACT REGIME:

a) Workers employed under indefinite-term and fixed-term labour contracts of one year or more shall enjoy wage, bonus, allowance, subsidy, labour protection, social insurance, collective welfare, food purchase... rewards, salary promotion, annual leave, personal leave, study... according to the regime for state employees. They shall be issued a labour record as the basis for implementing policies and regimes for workers. When retiring or losing work capacity, the previous working time in state agencies and enterprises shall be accumulated to calculate social insurance benefits (except in cases specified in Point 4, Section III of this circular).

b) Workers employed under job-specific or project-based labour contracts under one year shall enjoy:

- Wage agreed upon by both parties, but the wage level shall not be lower than the minimum wage set by the state.

- The basis for calculating the wage rate includes rank-based salary, allowances: price difference for living expenses according to region (if applicable) like workers and civil servants; social insurance and other additional fees, which are determined based on the state's rank-based salary and allowances; the price difference is determined based on the business trade prices of each locality, excluding the part already included in the salary. Social insurance and other additional fees are calculated from 25% to 30% of the rank-based salary. If the salary is paid based on production, this wage rate will be divided by the production quota or time quota to determine the wage rate per unit of production. The wage rate is accounted for in the product cost.

- In addition to wages, employees also enjoy bonus systems, night shift allowances, meal allowances during shifts, overtime allowances, and allowances in kind (if applicable). The enterprise has the responsibility to equip work tools and personal protective equipment for employees. When terminating the contract, employees must return to the enterprise any equipment that was provided. If employees provide their own equipment, the enterprise shall settle depreciation costs as agreed upon by both parties.

II- SELECTION OF LABOR (ARTICLE 45, 46).

1- During each planning period, enterprises base on production and business tasks and labor quotas, staffing standards to determine labor needs. On this basis, enterprises determine additional labor needs and develop plans to recruit additional labor through three forms of labor contracts. Recruitment plans are simultaneously with the complete plan scheme prescribed in Article 4 of the attached regulation under Decision No. 217/HĐBT dated November 14, 1987 of the Council of Ministers to guide recruitment sources and establish balance plans for essential needs for employees at provincial, city, and central special zone People's Committees (through the Department of Labor, Invalids, and Social Affairs) where the enterprise is located. One month after receiving the report, if the Committee does not respond, the enterprise can implement the recruitment plan reported. The results of recruitment must be reported to the provincial, city, and central special zone People's Committees (through the Department of Labor, Invalids, and Social Affairs) to resolve employee benefits such as household registration, food rations...

During the planning period, if there is an urgent need for additional labor under a temporary or specific task labor contract.

2- Following the guidance of the labor management agency regarding the recruitment area, enterprises directly recruit or sign contracts with the labor management agency to recruit according to the enterprise's requirements. Enterprises have the right to refuse to accept individuals introduced by various sectors, levels, including the labor management agency, if they do not meet the criteria or the enterprise does not have a need. Before recruiting additional labor, enterprises need to publicly post the number and criteria so that the workforce within the enterprise is aware. When signing indefinite-term or fixed-term labor contracts of one year or more, the enterprise must seek the opinion of the Enterprise Council.

Regarding the recruitment area, for general labor, local residents should be primarily recruited; in cases requiring technical labor, skilled labor, highly specialized labor, or occupations that the local area cannot meet, enterprises may recruit from other areas. Enterprises located in northern mountainous provinces, Central Highlands, and new economic zones may recruit spouses or children from other provinces, including agricultural workers.

Regarding the target group, based on the criteria, enterprises select in the following order:

- Employees currently working under a labor contract at the enterprise.

- Personnel transferred from other places.

- Graduates from regular training schools, graduates from training classes organized by the enterprise, and foreign cooperative workers who have completed their tasks.

- Children of employees in the enterprise.

- Other general laborers.

Among these groups, priority is given to recruiting disabled veterans still capable of working, spouses and children of martyrs or severely injured veterans, families with meritorious service to the revolution, soldiers and volunteers who have completed their tasks and returned.

For labor in cities and towns, particular attention should be given to those who are unemployed and have registered for job placement.

3- When enterprises frequently change their operating locations such as construction, transportation, geological surveys... when relocating a portion of the workforce to work outside the enterprise's location, the enterprise must report in advance to the provincial, city, and central special zone People's Committees (through the Department of Labor, Invalids, and Social Affairs) about the number of people and duration of work so that the Committee can balance essential needs for the workforce. During relocation, enterprises can bring technical workers along; for general laborers, recruitment should be done locally, and if local recruitment is insufficient, the enterprise may bring general laborers from elsewhere.

The local area where the enterprise operates has the responsibility to resolve all systems for the enterprise's workforce, such as temporary residence registration, sale of foodstuffs, consumer goods for these workers and their family members (if any) after moving from another place.

III- TERMINATION OF EMPLOYMENT AND CONTRACTS (ARTICLES 48, 49)

1- The enterprise director has the authority to terminate employment or terminate labor contracts with employees working under a labor contract system when they violate any of the following situations but have not reached the level of disciplinary dismissal or are under criminal investigation:

a. Failure to complete assigned tasks due to personal reasons, despite warnings and continued recurrence.

b. Stealing socialist property, despite education and failure to correct behavior.

c. Employees voluntarily leaving work at the enterprise for three days in a month (cumulative), ten days in a year (cumulative) without valid reasons.

d. Not adhering to the enterprise's internal regulations, causing damage to production and the lives of employees. Refusal to comply with the director's reasonable and recognized dispatch orders.

e. Serious violation of other terms in the signed labor contract.

In cases where production must be reduced, the enterprise shall take all measures to resolve employment for workers; if such resolution cannot be achieved, then termination of work or termination of the labor contract shall be implemented, and the worker shall enjoy the benefits stipulated in Point 4 below.

The Director shall not terminate work or terminate the labor contract when the worker is undergoing treatment or convalescence at a hospital or convalescent home; pregnant workers on maternity leave.

2\. Workers within the establishment have the right to request termination of work, or workers under a labor contract regime have the right to request early termination of the labor contract in the following circumstances:

a\. Need to change the place of work when the current job does not match their ability and health.

b\. When admitted to technical vocational schools... not dispatched by the enterprise.

c\. When family circumstances are truly too difficult.

d\. When the enterprise seriously violates the terms agreed upon in the labor contract.

3\. When the director terminates work or the worker requests termination of work or early termination of the labor contract, the party must notify the other party in writing at least 30 days in advance for indefinite-term and fixed-term contracts; at least 7 days in advance for contracts for specific tasks or projects lasting less than one year, from the date of receipt of the written notice.

Before the director decides to terminate the worker's employment or terminate the labor contract, the opinion of the Enterprise Trade Union Executive Board must be sought. If the Trade Union Executive Board has not reached an agreement, the director has the right to make the decision and bear responsibility for it.

4\. When there is a decision to terminate work or terminate the labor contract, the worker shall be entitled to a one-time allowance as follows:

- For each year of service, a one-month salary allowance including allowances and price subsidies (if applicable), and the purchase of 13 kilograms of food per month for six months at the guaranteed trading price, with the difference between the calculated price and the actual price (paid by the enterprise), if the worker terminates work or terminates the labor contract due to production reduction or dissolution of the enterprise and the cases specified in Point 2, Section III above.

- For each year of service, a half-month salary allowance including allowances and price subsidies (if applicable), and the purchase of 13 kilograms of food per month for six months at the guaranteed trading price, with the difference between the calculated price and the actual price (paid by the enterprise), if the worker terminates work or terminates the labor contract in the cases specified in Point I, Section III above.

- Reimbursement for travel expenses, baggage fees, and food expenses during travel for themselves and their family (if the family travels together) back to their place of residence according to the current regulations.

Accompanying persons shall continue to purchase food for six months according to the standard and receive price subsidies (if applicable) for one accompanying person, while other accompanying persons shall be provided with hardship allowances according to the current regulations.

Those who have received the one-time allowance as mentioned above, if they return to work in state enterprises, will not accumulate previous working time for social insurance purposes.

In cases where the labor contract is terminated here to continue working elsewhere, the previous working time will be accumulated, and they will not receive the aforementioned termination allowance.

5\. Workers have the right to lodge complaints when their rights are violated according to the Law on Examination and Resolution of Complaints and Accusations of Citizens issued by the State Council on November 27, 1981, and Decree No. 58/HĐBT dated March 29, 1982, of the Council of Ministers guiding the implementation of the law. The resolution of labor disputes in cases of forced termination of work shall still be carried out according to Decision No. 13/HĐBT dated January 14, 1985, of the Council of Ministers and Circular No. 02/TT-LN dated October 2, 1985, of the joint agencies of the People's Court, the People's Procuracy, the Ministry of Justice, the Ministry of Labor, and the General Department of Vocational Training.

6\. Workers employed at enterprises, when called up for military service, shall have their labor contracts temporarily suspended; after completing their military service, they shall resume work at the enterprise.

IV- SALARY AND INCOME (ARTICLE 50)

1\. The enterprise director has the authority to use the following funds to pay salaries and bonuses to workers in the enterprise:

a\) The wage fund is determined corresponding to the volume of products produced in the planned period and the unit cost (wage rate) in the product. The unit cost of wages in the product is determined based on the wage scale, salary table, and allowances prescribed by the State and reasonable and strict labor norms. The unit cost of wages shall be adjusted when there are changes in labor norms or factors included in the unit cost of wages, and fluctuations in prices over different periods. "5. The pre-tax weighted average cost of capital i (%) is determined according to the formula below:The method of determining labor norms and unit costs of wages shall, for the time being, be implemented according to the guidelines set forth in Circular No. 03/TT-LB dated February 22, 1986, of the Ministry of Labor - State Planning Commission.

b\) The bonus fund includes:

- Bonuses extracted from the profits earned by the enterprise (main production profits, secondary production profits, savings in material consumption, application of scientific and technological progress, improvement in product quality...).

- Bonuses for encouraging export production.

- Bonuses for products awarded quality marks by authorized agencies.

- Bonuses from higher-level agencies.

- Bonuses from partner units for successfully implementing economic contracts.

- Other existing bonus systems if applicable.

c\) Remaining wage and bonus funds from the previous period.

2- On the basis of the wage fund determined above, the director of the enterprise has the right to proactively choose various forms of payment (time-based wages, piece-rate wages, contracted wages) and appropriate wage systems for each group or individual employee within the enterprise who is classified and promoted according to technical grade standards for workers and job standards for officials based on production requirements and the hierarchical management level of cadres from the immediate superior; decides the wage level according to the current system for employees when temporarily transferred to other jobs; adjusts reasonably the incentive ratio for piece-rate wages for each main and auxiliary workshop, important products... to avoid averaging and achieve high economic efficiency. For cadres and managerial staff of the enterprise, their salaries and bonuses are linked to the production and business performance of the enterprise.

3- With the total bonus fund obtained from the aforementioned sources, the director of the enterprise has the right to proactively choose the form of distribution of bonuses and stipulate appropriate criteria, conditions, and bonus levels for groups and individuals to promote production and avoid averaging.

4- The director of the enterprise has the right to allocate a portion from the funds specified in Point 1, Section IV of this Circular to encourage employees who take on additional work, perform more difficult tasks, or have many outstanding contributions to the enterprise such as:

- Allowance for兼任多种职业或工作的补贴。

- Paying higher wages to those workers and officials with special talents of the enterprise, those people working in other units who have signed contracts with the enterprise as experts, consultants, and collaborators and who have made significant contributions bringing about high efficiency for the enterprise.

- Paying wages for additional days off granted by the enterprise director beyond the annual leave entitlement for those identified as advanced and outstanding workers, model workers, and labor heroes.

- Awarding bonuses to those who find new sources of materials, raw materials, or new markets for products that bring about efficiency for the enterprise.

- Awarding bonuses to units and individuals who excel in occupational safety and health work.

5- The director of the enterprise is responsible for clearly and accurately accounting for all financial resources generated as mentioned above; is responsible for establishing regulations and paying wages and bonuses. These regulations must be publicly announced within the enterprise.

6- The income level of each person in the enterprise depends on their productivity, quality, and effectiveness of work and that of the entire unit, without controlling the maximum income level. Income includes wages, bonuses, and allowances as stipulated in Points 2, 3, and 4 of Section IV of this Circular.

V- WORKING CONDITIONS AND OCCUPATIONAL SAFETY (ARTICLE 54)

1- The plan for labor safety, hygiene, and improvement of working conditions is an inseparable part of the production, technical, financial, and social plans of the enterprise. The enterprise is responsible for developing and organizing the implementation of such plans.

2- The enterprise is obligated to comply strictly with laws, regulations, standards for labor protection, safety, hygiene, working conditions, and technical safety norms; must ensure the good operational status of production machinery and equipment, safety devices, and hygiene facilities. When modernizing technological processes, machinery, and equipment, constructing new or expanding workshops..., it must ensure requirements for safety and hygiene.

3- The enterprise director is responsible for organizing training and education for managers, technical staff, and workers to understand and comply with labor protection regulations, safe and hygienic working methods, and their duties and authorities regarding labor protection; must regularly organize inspections of compliance with these regulations throughout the enterprise.

4- The enterprise shall not assign workers to work under conditions posing a risk of fatal accidents or acute poisoning; workers have the right to refuse work under such conditions without being considered a violation of labor discipline. In cases where safety is not ensured leading to labor accidents, the enterprise director shall bear responsibility.

5- The enterprise must implement the system of providing personal protective equipment and material benefits for those engaged in hazardous and toxic work.

The enterprise has the right to purchase personal protective equipment to ensure quality, specifications, and usage time requirements.

6- The implementation of labor protection regulations and safe and hygienic working methods must be concretized into specific indicators in the regular competition content for everyone from leaders to workers, with strict rewards and penalties.

7- The enterprise director is responsible for reporting and ensuring the accuracy of reports on labor safety, hygiene, and labor accidents, occupational diseases to the superior management agency and the local Labor, Invalids, and Social Affairs Department.

VI- SOCIAL INSURANCE (ARTICLE 32).

The enterprise is responsible for fully and timely contributing to the social insurance fund and implementing the state's social insurance system, and has the right to use collective welfare funds for purposes of improving the spiritual and material living standards of workers.

VII- IMPLEMENTATION

1- The Ministry of Labor, Invalids, and Social Affairs requires sectors and localities to guide subordinate units in implementing this Circular; if there are different provisions, they must be agreed upon by the Ministry of Labor, Invalids, and Social Affairs.

2- The Director of the Provincial Department of Labor, Invalids, and Social Affairs is responsible for assisting the People's Committee of provinces, cities, and centrally-administered municipalities, and the heads of departments and general administrations under their jurisdiction, in guiding, urging, inspecting, and periodically reporting on the implementation of this Circular to the Ministry of Labor, Invalids, and Social Affairs.

3- This Circular is disseminated to all workers in the enterprise and takes effect from the date of signature. Previous provisions contrary to this Circular are abolished.

SOCIALIST REPUBLIC OF VIETNAM

Independence - Freedom - Happiness

MODEL LABOR CONTRACT

(Annexed to Circular No. 01/LDTBXH-TT
January 9, 1988 of the Ministry of Labor, Invalids, and Social Affairs)

We, one party being Mr./Mrs.:

Position:

And the other party being Mr./Mrs.:

Occupation:

Residing at commune, district, province, or equivalent:

Holding identification number: day month year 19

The agreement to conclude the labor contract and commit to comply with the following terms:

Article 1: Work, working hours, and place of work:

- Job title and workload:

- Contract form:

- Place of work:

Article 2: 1. The Steering Committee operates on a part-time basis and has a permanent office at the Ministry of Health.

- Working hours:

- Tools for work:

- Occupational safety and health conditions

Article 3: Duties, rights, and benefits of the worker

1- Duties:

- Fulfill the assigned tasks in quantity and quality.

- Have the responsibility to protect the property of the enterprise.

- Adhere fully to the internal regulations, rules, labor discipline, and occupational safety of the enterprise.

- Train and improve vocational skills to serve the enterprise's operations.

2. Powers:

Has the right to terminate the labor contract before the term according to the provisions at point 2, Section III of Circular No. 01/LDTBXH-TT dated January 9, 1988, issued by the Ministry of Labor, War Invalids, and Social Affairs.

3- Benefits:

- Wages and bonuses;

- Allowances;

- Occupational protection;

- Leave for holidays, annual leave, personal matters;

- Social insurance;

- Collective welfare;

- Severance pay in specific cases, etc.

Article 4: Duties and authorities of the enterprise director.

1- Duties:

- Prepare all aspects for production, living conditions, and occupational safety for workers.

- Ensure employment for workers.

- Ensure full implementation of all systems and benefits for workers as stipulated in Articles 1, 2, and 3 above.

- Reasonably arrange and utilize the capabilities of workers in accordance with job requirements.

2. Powers:

Has the right to terminate the labor contract before the term according to the provisions at point 1, Section III of Circular No. 01/LDTBXH-TT dated January 9, 1988, issued by the Ministry of Labor, War Invalids, and Social Affairs.

Article 5: General Provisions

Resolution of special cases that may occur such as changes in production plans, construction; relocation due to lack of raw materials, energy, equipment failure, natural disasters, enemy attacks requiring cessation of production at the current location when workers are on military service and upon their return.

The validity of the contract begins from the date... and remains valid until the end of the date...

Article 6: This contract is made in two copies:

- One copy kept by the enterprise director,

- One copy kept by the worker.

Made in...