Circular No. 04/2003/TT-BLDTBXH guides the implementation of salary adjustments and allowances in enterprises.

CIRCULAR

Guidelines for Adjusting Wages and Allowances in Enterprises

 Pursuant to Clause 1, Article 1 of Decree No. 03/2003/NĐ-CP dated January 15, 2003 of the Government on wage adjustment, social allowances, and the first step towards reforming the wage management mechanism, after exchanging opinions with relevant ministries and sectors, the Ministry of Labor, Invalids, and Social Affairs hereby guides the implementation of wage and allowance adjustments in enterprises as follows:

 I. Scope of Application.

The subjects to which the provisions of this Circular apply are workers employed in the following organizations:

State-owned enterprises established and operating under the Law on State-Owned Enterprises;

State-owned limited liability companies holding 100% of the charter capital;

Enterprises of political organizations and political-social organizations;

State-owned corporations and state-owned enterprises transitioning to operate under the parent company-subcompany model;

Organizations, units, and entities not assigned personnel quotas belonging to administrative agencies, public service units of the State, the Party, mass organizations, and associations permitted to engage in production and business activities;

Joint stock companies, limited liability companies, partnerships, and private enterprises operating under the Law on Enterprises;

(The above organizations are referred to collectively as enterprises)

II. Method for Recalculating Wage Levels and Allowances.

1. For enterprises currently applying wage scales, salary tables, and allowances issued by the State, based on the wage level coefficients and allowance levels stipulated in Decrees No. 25/CP and 26/CP dated May 23, 1993, and Decree No. 110/1997/NĐ-CP dated November 18, 1997 of the Government, and the minimum monthly wage of 290,000 VND as prescribed in Clause 1, Article 1 of Decree No. 03/2003/NĐ-CP dated January 15, 2003 of the Government, to recalculate wage levels, salary allowances, unit labor costs, social insurance, health insurance, wages during work stoppages, holidays, annual leave, and other benefits according to the labor laws effective from January 1, 2003, specifically as follows:

a. Recalculating wage levels:

Wage Level = Minimum Monthly Wage x Current Enjoyed Wage Level / Minimum Monthly Wage Effective from January 1, 2003 290,000 VND

b. Recalculating allowance levels:

For allowances calculated based on the minimum wage:

Allowance Level = Minimum Monthly Wage x Current Enjoyed Allowance Level / Minimum Monthly Wage Effective from January 1, 2003 290,000 VND As Prescribed

For allowances calculated based on grade, position, specialty, and vocational wages:

Allowance Level = Current Enjoyed Allowance Level x Current Enjoyed Wage Level / Minimum Monthly Wage Effective from January 1, 2003 As Prescribed

c. Recalculating the wage amount of the retained differential coefficient:

Wage Amount of Retained Differential Coefficient = Minimum Monthly Wage x Current Enjoyed Retained Differential Coefficient (if applicable) / Minimum Monthly Wage Effective from January 1, 2003 290,000 VND

d. For enterprises where the State has specified bonus systems within the wage fund, the calculation should be based on the minimum monthly wage of 290,000 VND.

2. For state-owned enterprises when applying an additional adjustment factor not exceeding 1.5 or 2 times the general minimum wage set by the State (290,000 VND/month as of January 1, 2003) as the basis for calculating unit labor costs, they must ensure compliance with the conditions stipulated in Clause 1, Article 1 and Article 2 of Decree No. 03/2001/NĐ-CP dated January 11, 2001 of the Government amending and supplementing certain articles of Decree No. 28/CP dated March 28, 1997 of the Government and Circular No. 05/2001/TT-BLĐTBXH dated January 29, 2001 of the Ministry of Labor, Invalids, and Social Affairs guiding the establishment of unit labor costs and wage management, income in state-owned enterprises.

Specifically, for state-owned construction enterprises and state-owned enterprises engaged in public services, when applying the minimum wage of 290,000 VND/month, they shall not apply the additional adjustment factors of 0.4, 0.3, and 0.2 for the minimum wage as stipulated in Circulars No. 03/2002/TT-BLĐTBXH and No. 04/2002/TT-BLĐTBXH dated January 9, 2002 of the Ministry of Labor, Invalids, and Social Affairs but instead apply the additional adjustment factor for the minimum wage as stipulated in Circular No. 05/2001/TT-BLĐTBXH mentioned above to determine labor cost expenses, prepare construction project budgets, or labor cost expenses in product/service unit prices.

3. For enterprises establishing wage scales according to labor law regulations, based on the minimum monthly wage of 290,000 VND, enterprises should recalculate the wage levels recorded in labor contracts, salary unit prices, calculate social insurance, health insurance, wages during work stoppages, holiday pay, annual leave, and other benefits as prescribed by labor laws.

4. Meal allowances calculated based on working days in the month for workers and staff in state-owned enterprises as stipulated in Circular No. 15/1999/TT-BLĐTBXH dated June 22, 1999 of the Ministry of Labor, Invalids, and Social Affairs shall not exceed the minimum monthly wage of 290,000 VND starting from January 1, 2003.

III. Implementation Organization.

1. Ministries, ministerial-level agencies, government agencies, provincial People's Committees, municipal People's Committees directly under the central government, and the Chairman of the Board of Directors of State Corporations 91/TTg have the responsibility to direct, urge, and inspect enterprises to implement in accordance with the provisions of this Circular.

2. For state-owned enterprises, when determining unit labor costs and meal allowances in annual production and business plans, they need to adopt proactive measures to increase labor productivity, improve efficiency, link increases in workers' income with profit increases, and contributions to the State as stipulated in relevant documents.

3. This Circular takes effect 15 days after its publication in the Official Gazette, and the provisions of this Circular apply from January 1, 2003.

During the implementation process, if there are any difficulties, please report them to the Ministry of Labor, Invalids, and Social Affairs for consideration and resolution./.