Decree No. 07/1999/NĐ-CP Issuing the Regulation on Implementing Democracy in State-Owned Enterprises

DECREE

Issuing the Regulation on Implementing Democracy in State-Owned Enterprises

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THE GOVERNMENT

Pursuant to the Government Organization Law dated September 30, 1992;

Pursuant to Resolution No. 60/1998/NQ-UBTVQH10 dated August 20, 1998 of the Standing Committee of the National Assembly on issuing the Regulation on Implementing Democracy in State-Owned Enterprises;

At the proposal of the Minister, Head of the Organizational-Cadre Department of the Government, Head of the Central Enterprise Management Reform Board,

DECREE:

Article 1. This Decree promulgates the Regulation on Implementing Democracy in State-Owned Enterprises.

This Regulation shall be implemented in state-owned enterprises according to Article 1 and Article 2 of the Law on State-Owned Enterprises.

Article 2. This Decree takes effect 15 days from the date of issuance. Previous regulations that conflict with the Regulation issued together with this Decree are hereby abolished.

The Minister, Heads of Ministries equivalent to Ministries, Heads of agencies under the Government, Chairmen of provincial People's Committees directly under the central government are responsible for guiding and supervising the implementation of this Decree.

The Boards of Directors and General Directors of state-owned enterprises are responsible for implementing this Decree.

REGULATIONS
d.1. Amount of taxable income in Vietnam:Implementing democracy in state-owned enterprises

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(Issued together with Decree No. 07/1999/NĐ-CP dated February 13, 1999 of the Government)

Chapter 1:

GENERAL PROVISIONS

Article 1. Implementing democracy in state-owned enterprises aims at:

1. Specificizing the principle "people know, people do, people check", promoting democratic rights through trade union organizations and direct democracy of workers, stimulating creativity of collectives and individuals to enhance operational efficiency, preserve and develop state capital, practice thrift, combat waste, corruption, violations of democracy, discipline, internal disturbances, and promote the leading role of state-owned economy in the industrialization and modernization cause.

2. Creating a strong impetus for sustainable development of state-owned enterprises based on closely linking responsibilities between General Directors and workers in promoting production and business operations effectively, increasing revenue for the state budget, improving living standards, creating more jobs for workers; clearly defining authorities, responsibilities, obligations, and benefits of General Directors and workers regarding the results of production and business operations; fostering a favorable environment to strengthen solidarity, implement self-criticism and mutual criticism, supervision between General Directors and workers as well as within the worker community, and among management leaders; ensuring harmonious interests of the state, enterprises, General Directors, and workers corresponding to the results of production and business operations.

Article 2. Implementing democracy in enterprises must go hand in hand with enhancing the effectiveness of state management by state management agencies and enterprise management, implementing specific division of labor and authority in enterprises, encouraging and creating a favorable environment for the active and creative management activities of General Directors in accordance with market mechanisms; raising the level of understanding of laws, rights, obligations, and responsibility before the law of workers and enterprise managers; properly exercising the rights, obligations, and responsibilities of workers in implementing democracy in state-owned enterprises, while maintaining the confidentiality of production and business operations in compliance with legal provisions.

Article 3. Employers and workers in state-owned enterprises have the obligation to fulfill their assigned tasks, comply with labor contracts and collective agreements, adhere to enterprise rules and regulations; fully exercise democratic rights, maintain discipline, struggle against manifestations of corruption, abuse of democracy causing internal disunity; strive for the development of the enterprise during favorable and difficult times in business.

Article 4. Strengthening the leadership of the Party organization in state-owned enterprises over all workers, the Board of Directors (in state-owned enterprises with a Board of Directors), General Director, trade union, and Ho Chi Minh Communist Youth Union in implementing the Party's policies and state laws to enhance the effectiveness of enterprise operations and build a stronger Party.

Chapter 2:

MATTERS TO BE PUBLICIZED IN STATE-OWNED ENTERPRISES

Article 5. Matters that the Board of Directors and General Director must publicize in state-owned enterprises include:

1. Long-term, medium-term, and annual general directions and tasks concerning investment, production, and business development of the enterprise, advantages, difficulties, weaknesses; particularly production plans and work programs of workshops, teams (groups) of production, departments under the enterprise; major policies on changing enterprise management methods and transforming the enterprise.

2. Main state policies and enterprise regulations directly related to workers in the enterprise regarding labor restructuring, recruitment, termination of employment, training and retraining; wages and income, social insurance, health insurance, housing; profit distribution and establishment of enterprise funds; plans and implementation of recruitment and labor restructuring; training and upgrading the skills of workers.

3. Enterprise rules and regulations on recruitment and termination of employment; working hours, overtime, rest periods with pay, without pay; cost standards; wage payment, bonuses, gifts; promotion of cadres, training, and upgrading the skills of cadres; rewards, disciplinary actions, and material responsibilities; protection of assets, confidentiality of production and business operations, and enterprise reputation in compliance with legal provisions; operation procedures of machinery and equipment at workplaces; conservation of raw materials; implementation of occupational safety, environmental protection, and workplace hygiene; fire prevention; prevention of legal violations.

4. Financial transparency regarding:

Annual audit results and financial reports of the enterprise.

The situation regarding capital and the effectiveness of capital utilization by the enterprise, overdue and over-due debts and their causes; difficulties and measures to mobilize capital, improve the effectiveness of capital utilization.

Revenue sources of the enterprise from business activities and other activities such as revenue from investment outside the enterprise; revenue from bill buying and selling, bond, stock trading; revenue from leasing and asset contracting; revenue from the difference in the value of liquidated assets; revenue from state subsidies; revenue from joint ventures, joint operations, share capital contributions, interest income from deposits and loans.

Investment for development, expenses for training, upgrading and enhancing the skills of workers.

Regulations and implementation of expenses by the enterprise for management activities, hospitality, meetings, transactions, and brokerage commissions; fines that the enterprise must pay.

Fulfillment of tax obligations and contributions as prescribed by the State: social insurance, health insurance, trade union fees.

Profits and losses and their objective and subjective causes; measures to increase profits and reduce losses.

Income and average income of workers.

Establishment and use of funds of the enterprise from post-tax profits: development investment fund, financial reserve fund, unemployment assistance reserve fund, welfare fund, award fund. Expenses for humanitarian and social purposes.

Other revenues and expenditures.

5. Cadre standards, procedures, and分级授权晋升干部的程序，从生产班组及以上。

6. Plans for the activities of the Employee Inspection Committee and results of handling complaints and reports according to the laws on complaints and reports.

7. Resolutions of the Party organization at the grassroots level and relevant Party committees concerning production and business operations as decided by the enterprise's Party committee; resolutions of the Trade Union and the Communist Youth League within the enterprise.

Article 6. Based on the characteristics of the business industry, the Board of Directors and General Director agree with the Trade Union Executive Committee to specify and publicly announce throughout the enterprise which contents in Article 5 need to be regularly reported to key cadres' meetings (Party Committee Standing Committee, Chairperson and Deputy Chairpersons of the Trade Union, Secretary of the Communist Youth League, Heads and Deputy Heads of Departments (Offices), Workshops); which contents need to be reported to Departments (Offices); to Workshops, Production Teams (Groups) and to all workers. In addition to defining the right to receive information for each category within the enterprise, it is necessary to clearly define the responsibility to protect the enterprise's production and business secrets, especially production technology and product costs, in accordance with the provisions of the law. For matters involving state secrets and national defense-security secrets, dissemination must comply with the law on protecting state secrets.

Information recipients have the right to question the Board of Directors and General Director about the contents that have been publicly stipulated in Article 5 of this Regulation; the Board of Directors and General Director are responsible for explaining and clarifying any doubts and questions raised by organizations and workers in the enterprise and must fully bear legal responsibility for the truthfulness of the disclosed information; they are also responsible for reporting back on the adoption of suggestions and comments from organizations and workers regarding matters that should be disclosed in the enterprise.

Article 7. The Board of Directors and General Director closely cooperate with the Trade Union to ensure timely, appropriate, and targeted disclosure of information required to be disclosed in the enterprise through various suitable methods.

1. Workers' Congress (all members or representatives) held from Production Teams (Groups), Departments (Offices) up to the entire enterprise.

2. Announced in regular meetings of key cadres of the enterprise.

3. Publicized in enterprise meetings, or in Workshops, Production Teams (Groups), Departments (Offices) organized by professionals.

4. Announced at meetings of the Trade Union and other political-social organizations within the enterprise.

5. Announced in writing or through publications sent to each Production Team (Group), Workshop, Department (Office), or publicly posted at convenient locations within the enterprise.

6. Announced through the enterprise's public address system.

Chapter 3:

MATTERS IN WHICH WORKERS PARTICIPATE IN OPINION

Article 8. Matters in which workers participate in opinion before the Board of Directors and General Director of the enterprise make decisions include:

1. Directions, tasks, and plans for medium-term and long-term production and business operations of the enterprise, particularly the tasks and plans for production and work of Departments (Offices), Workshops, Production Teams (Groups); evaluation of the enterprise's operational situation and that of Departments (Offices), Workshops, Production Teams (Groups).

2. Measures to develop production and business operations, improve product structure, enhance competitiveness, reorganize production, and implement shareholding reform.

3. Formulation and implementation of internal regulations and rules as prescribed in Clause 3, Article 5 of this Regulation.

4. Measures related to: technological innovation, equipment upgrades, increasing labor productivity, product quality, reducing product costs, environmental protection; improving labor organization, labor protection, working conditions, labor reorganization, and training and upgrading the skills of workers; paying special attention to measures directly related to Workshops, Production Teams (Groups), Departments (Offices) where workers are employed.

5. Main contents of collective labor agreements to be signed between the General Director and the Trade Union Chairperson or representative, including commitments on employment and job security, rest time, wages, bonuses, allowances, economic-technical norms, occupational safety and hygiene, and social insurance, health insurance, and social welfare.

6. Main contents of individual labor contracts to be signed between workers and the General Director or the General Director's representative, including tasks to be performed, working hours, rest time, place of work, contract duration, wages, conditions for occupational safety and hygiene, and social insurance, health insurance for workers.

7. General policy on mobilizing and utilizing capital sources, fulfilling obligations to localities, setting up and using funds from post-tax profits, regulations on hosting guests, meetings, transactions, and brokerage commissions; contents of support programs for localities and humanitarian activities.

Article 9. Matters that employees participate in providing opinions for higher-level management agencies, Party organizations, and mass organizations within enterprises to consider before making decisions or handling include:

1. Introducing individuals who meet the criteria and trustworthiness standards for the positions of Director, Deputy Director, and Chief Accountant; conducting surveys to assess the performance, ability to gather and promote democracy, fairness, and moral character of the Chairperson of the Board of Management (for state-owned enterprises with a Board of Management), Directors, Deputy Directors, and Chief Accountants of the enterprise. Introducing representatives of trade union organizations who meet the criteria and trustworthiness standards to participate in the Board of Management and Supervisory Board (where there is a Board of Management) for relevant state authorities to consider and appoint.

2. Establishing the program of activities and evaluating the results of the People's Inspection Committee.

3. Organizational structure and content of the Workers' and Staff Congress at the production team level according to the Law on State-Owned Enterprises and guidelines from the Vietnam General Confederation of Labor.

4. Drafting resolutions of the grassroots Party Congress and Party committees on issues related to production and business operations of the enterprise.

5. Contents of activities of the grassroots Trade Union organization and the Ho Chi Minh Communist Youth Union.

Article 10. Based on the characteristics of the industry and production organization of the enterprise, the Board of Management and the Director shall agree with the Trade Union Executive Committee to clearly announce throughout the enterprise which matters require participation and opinions from all workers and staff, departments (offices), workshops, production teams, or certain experts inside and outside the enterprise.

The Board of Management, Director, Party organizations, and mass organizations within the enterprise have the responsibility to inform about the adoption of employee participation opinions as stipulated in Article 8 and Article 9. If the employee participation contents specified in Clauses 1, 2, 3, 4, and 7 of Article 8 are not accepted, employees must still strictly comply with the Director's decision (for the contents specified in these clauses). For the contents specified in Article 9, employees must comply with the decisions of higher-level management agencies, Party organizations, and mass organizations within the enterprise.

Article 11. Main forms for employees to provide opinions include:

1. Workers' and staff congresses of the enterprise, departments (offices), production teams.

2. Specialized meetings convened by the enterprise Director, heads of departments (offices), workshops, production teams.

3. Through organizational discussions and negotiations on the content of collective labor agreements and individual labor contracts.

4. Through receiving citizens according to the provisions of laws on complaints and denunciations.

5. Grassroots Party Committees and Trade Union Executive Committees organizing to collect opinions from workers and staff.

6. Direct contact between the Chairman of the Board of Management or the Director and workers and staff according to scheduled or urgent requests.

7. Setting suggestion boxes at convenient locations within the enterprise.

Chapter 4:

MATTERS DECIDED BY EMPLOYEES

Article 12. Matters decided by employees include:

1. Voting to approve collective labor agreements, or amendments and supplements for the Trade Union Chairman or representative and the Director to sign.

2. Signing labor contracts with the Director or his representative; unilaterally terminating labor contracts according to the provisions of the Labor Code.

3. Discussing and voting at the Workers' and Staff Congress to approve enterprise regulations and plans directly related to the rights and obligations of employees, in accordance with state guidance and the actual situation of the enterprise; focusing on regulations regarding the establishment and use of welfare funds, reward funds, and contingency funds for unemployment benefits.

4. Electing the People's Inspection Committee at the Workers' and Staff Congress.

Article 13. Employees decide on matters stipulated in Article 12 of this Regulation through:

1. Workers' and Staff Congress (all members or delegates).

2. Enterprise-wide meetings or department (office), workshop, production team meetings.

3. The enterprise trade union organization.

Chapter 5:

RIGHTS OF SUPERVISION AND INSPECTION BY EMPLOYEES

Article 14. Employees have the right to supervise and inspect all contents that have been publicly disclosed in the enterprise according to the provisions of Article 5 of this Regulation, and to self-supervise, inspect, and educate each other in the implementation of employee rights and obligations; particularly paying attention to supervising and inspecting:

1. Implementation of tasks and production and business plan targets of the enterprise.

2. Implementation of resolutions of the Workers' and Staff Congress.

3. Implementation of enterprise internal regulations and rules.

4. Implementation of collective labor agreements.

5. Implementation of labor contracts.

6. Implementation of state policies and systems, tax payment, and fulfillment of the enterprise's obligations to the state and society. Particularly the use of post-tax funds, especially welfare funds of the enterprise.

7. Results of resolving labor disputes.

8. Results of resolving citizen complaints and denunciations.

Article 15. Implementation of employees' supervision and inspection rights in the enterprise through main methods and organizations including:

1. Through the Workers' and Staff Congress of the enterprise and meetings of departments (offices), workshops, production teams.

2. Through leadership, inspection, and supervision by Party organizations and participation in management by the enterprise trade union organization.

3. Through the activities of the People's Inspection Committee.

4. Through auditing activities according to state regulations.

5. Through exercising the right to file complaints, denunciations, and reflections according to the law on complaints and denunciations.

Chapter 6:

IMPLEMENTING PROVISIONS

Article 16. State-owned Corporations apply this Regulation to establish specific regulations suitable for their corporations.

State-owned enterprises base this Regulation to establish enterprise internal regulations and rules, detailed down to each department (office), workshop, production team.

Article 17. The Board of Directors, General Director, Trade Union, Youth Communist League of Ho Chi Minh Corporation have the responsibility to protect and encourage, promptly reward those who struggle against negative practices; prevent and handle acts of repression, obstruction of struggles against negative practices, and actions that abuse democracy, cause division, disrupt internal stability, and negatively impact production and business operations of the corporation.

Any person violating the provisions of this Regulation shall be subject to disciplinary action, administrative violation handling, or criminal prosecution according to the nature and severity of the violation as stipulated by law.

Article 18. Under the leadership of the Party Committee, the Chairman of the Board of Directors and the General Director of the corporation are responsible for organizing the implementation of this Regulation and coordinating with the trade union organization within the corporation to implement it.

Article 19. The Minister, Head of a ministry-level agency, Head of an agency under the Government, and the Chairman of the People's Committee of a province or centrally governed city are responsible for directing the implementation and reporting periodically every six months to the Government on the situation regarding the implementation of this Regulation.

Article 20. The Head of the Central Enterprise Management Reform Board is responsible for monitoring, summarizing, and periodically reporting to the Prime Minister on the situation regarding the implementation of this Regulation.