Circular No. 14/2003/TT-BNV guiding the application of the minimum wage when implementing quota staffing and administrative management expenses; reduction policies for staffing quotas; financial systems applicable to units with income.

 CIRCULAR

Guidelines for applying the minimum wage when implementing quota staffing and administrative management expenses; reduction policy for staffing quotas; financial regime applicable to units with income

Implementing Clause 1, Article 4 of Decree No. 03/2003/NĐ-CP dated January 15, 2003 of the Government on adjusting salaries, social allowances, and reforming the salary management mechanism; after receiving the opinion of the Ministry of Finance in Circular No. 2860/TC-CSTC dated March 28, 2003, the Ministry of Home Affairs guides the application of the adjustment of the minimum wage during the implementation of quota staffing and administrative management expenses; implement the policy of reducing staffing quotas and the financial system for units with income as follows:

I. APPLICATION OF THE MINIMUM WAGE FOR ADMINISTRATIVE ORGANIZATIONS OF THE STATE IMPLEMENTING THE EXPANSION OF EXPERIMENTAL STAFFING QUOTA AND ADMINISTRATIVE MANAGEMENT EXPENSES ACCORDING TO DECREE NO. 192/2001/QĐ-TTG DATE December 17, 2001 OF THE PRIME MINISTER.

1. The annual salary fund of administrative organizations implementing the experimental staffing quota and administrative management expenses before January 1, 2003 shall be implemented according to the provisions at Point 7.2.2 Section 7 Part II of Joint Circular No. 17/2002/TTLT-BTC-BTCCBCP dated February 8, 2002, calculated based on a minimum wage of 210,000 VND/month and stabilized for three years from the date of implementation. From January 1, 2003, due to the State's regulation of a minimum wage of 290,000 VND/month, in addition to the salary fund mentioned above, the following additional amounts will also be supplemented:

a) The supplementary salary fund is calculated using the following formula:

QTL_bs = L_cl x (K₂ + signing and implementing Agreements₃) x L x 12 months.

Where:

- QTL_bs: Supplementary salary fund.

-_cl: The difference between the new minimum wage of 290,000 VND/month and the old minimum wage of 210,000 VND/month (80,000 VND/month).

- K₂: Average grade coefficient of the unit

- K_a: Average allowance coefficient of the unit

- L: Number of staff and indefinite-term contract workers rearranged according to the approved plan (this number must be less than or equal to the allocated quota).

b) The amount deducted for social insurance, health insurance, and trade union fees is calculated using the following formula:

TN = QTL_bs x TL%

Where:

- TN is the total amount supplemented for social insurance, health insurance, and trade union fees for officials and civil servants.

- TL% is the percentage calculated based on the supplementary salary fund to deduct 15% for social insurance, 2% for health insurance, and 2% for trade union fees.

Example: Organization X was assigned to implement the staffing quota and administrative management expenses from January 1, 2002 to December 31, 2004, with a quota of 200 people, average grade coefficient of 3.4, and average allowance coefficient of 0.2. In 2002, it reduced 20 people. Therefore, the supplementary salary fund of Organization X from 2003 is:

80,000 VND/month x (3.4+ 0.2) x 180 people x 12 months = 622,080,000 VND.

- The amount deducted for social insurance, health insurance, and trade union fees is supplemented.

622,080,000 VND x 19% = 118,200,000 VND.

- The total salary fund and deductions from 2003 is:

210,000 VND/month x (3.4+ 0.2) x 200 people x 12 months+ 622,080,000 VND+ 118,200,000 VND = 2,554,680,000 VND.

2. Administrative organizations of the state, party, and mass organizations authorized to implement the experimental quota from January 1, 2003 shall apply the minimum wage of 290,000 VND/month for their salary funds.

3. The source for supplementing the salary fund shall be implemented according to Clause 1, Clause 3, Clause 4, Article 2 of Decree No. 03/2003/NĐ-CP dated January 15, 2003 of the Government and Circular No. 16/2003/TT-BTC dated March 14, 2003 of the Ministry of Finance guiding the sources for implementing the salary adjustment and social allowance for 2003.

II. APPLICATION OF THE MINIMUM WAGE WHEN IMPLEMENTING THE POLICY OF REDUCING STAFFING QUOTAS IN ADMINISTRATIVE ORGANIZATIONS AND UNITS WITH INCOME ACCORDING TO RESOLUTION NO. 16/2000/NQ-CP DATE October 18, 2000 OF THE GOVERNMENT.

1. The minimum wage for calculating the monthly salary for severance pay based on the number of years of social insurance contributions for those who leave work due to reduction in staffing quotas is specified as follows:

1.1. A minimum wage of 210,000 VND/month for calculating the monthly salary for severance pay based on the number of years of social insurance contributions prior to January 1, 2003.

1.2. A minimum wage of 290,000 VND/month for calculating the monthly salary for severance pay based on the number of years of social insurance contributions from January 1, 2003.

Example: Mr. Tran Van D, subject to reduction in staffing quotas, has a basic salary coefficient of 2.5 and a regional allowance coefficient of 0.3 until the day he left work in November 2003, he had 10 years and 2 months of social insurance contributions. His severance benefits are calculated as follows:

- The monthly salary and allowances that Mr. D enjoyed before January 1, 2003 to calculate severance pay.

210,000 VND x (2.5+ 0.3) = 588,000 VND/month.

- The monthly salary and allowances that Mr. D enjoyed from January 1, 2003 to calculate severance pay.

290,000 VND x (2.5+ 0.3) = 812,000 VND/month.

a) The amount of severance pay under Decree No. 96/1998/NĐ-CP.

- Job-seeking allowance.

812,000 VND x 3 months = 2,436,000 VND

- Severance pay.

588,000 VND x 9 months+ 812,000 VND x 1 month = 6,104,000 VND

b) The amount of severance pay under Resolution No. 16/2000/NQ-CP is:

588,000 VND x 9 months+ 812,000 VND x 1 month = 6,104,000 VND

The total amount Mr. D received upon leaving work is (a+b)

2,436,000 VND+ 6,104,000 VND+ 6,104,000 VND = 14,644,000 VND.

2. The allowance for early retirement; allowance for being assigned to work in semi-public institutions; job-seeking allowance; payment of salary during the period of study to find work and six-month allowance for cases of studying to change professions before leaving work shall be applied at a minimum wage of 290,000 VND/month.

3. The method of calculating the level of salary grades and allowances according to salary (if any) is stipulated in Joint Circular No. 73/2000/TTLT-BTC-BTCCBCP dated December 28, 2000 guiding the implementation of Resolution No. 16/2000/NQ-CP on the policy of reducing staffing quotas in administrative organizations and units with income.

4. Additional funds resulting from the adjustment of the minimum wage to pay subsidies for implementing the policy of streamlining the workforce pursuant to Resolution No. 16/2000/NQ-CP of the Government shall be provided from the state budget.

III. APPLICATION OF THE MINIMUM WAGE FOR IMPLEMENTING THE FINANCIAL REGIME FOR PUBLIC SERVICE UNITS WITH REVENUE PURSUANT TO DECREE NO. 10/2002/NĐ-CP ON JANUARY 16, 2002 OF THE GOVERNMENT

1. Public service units with revenue that operate on a self-financing basis and are responsible for their own finances, staffing, salary fund, and income shall implement according to the guidelines set forth in the following Circulars:

- Joint Circular No. 20/2003/TTLT-BTC-BVHTT-BNV dated March 24, 2003, issued jointly by the Ministry of Finance, the Ministry of Culture, Sports and Tourism, and the Ministry of Home Affairs, guiding the financial management regime for public service units with revenue operating in the cultural and information sectors.

- Joint Circular No. 21/2003/TTLT-BTC-BGDĐT-BNV dated March 24, 2003, issued jointly by the Ministry of Finance, the Ministry of Education and Training, and the Ministry of Home Affairs, guiding the financial management regime for public educational and training institutions with revenue.

- Joint Circular No. 22/2003/TTLT-BTC-BKHCN-BNV dated March 24, 2003, issued jointly by the Ministry of Finance, the Ministry of Science and Technology, and the Ministry of Home Affairs, guiding the financial management mechanism for public scientific and technological organizations with revenue.

- And other joint circulars guiding the implementation of Decree No. 10/2002/NĐ-CP dated January 16, 2002 of the Government.

2. Public service units that fully self-fund their regular operational expenses shall apply a minimum wage of 290,000 VND/month to determine the salary fund of the unit and pay salaries to each employee. The difference between the increased minimum wage shall be covered by the unit from its revenue, savings, and funds according to the guidance of the Ministry of Finance.

3. Public service units that partially self-fund their regular operational expenses shall apply a minimum wage of 290,000 VND/month to determine the salary fund of the unit and pay salaries to employees.

a) For public service units that have implemented a minimum wage of 290,000 VND/month or higher before January 1, 2003, the unit shall cover the difference itself, and the state will not provide supplementary funding for the increase in the minimum wage. The additional difference in the minimum wage shall be funded from the unit's revenue, savings, and funds according to the guidance of the Ministry of Finance.

b) Public service units that partially fund when implementing a minimum wage of 290,000 VND/month must use sources as guided by Circular No. 16/2000/TT-BTC dated March 14, 2003, of the Ministry of Finance regarding the adjustment of wages and social allowances for 2003. If there is a shortfall, the state budget will supplement the additional salary fund.

IV. IMPLEMENTATION

1. Based on the provisions of Decree No. 03/2003/NĐ-CP dated January 15, 2003 of the Government and the provisions of this Circular, the Ministers, Heads of ministerial-level agencies, Heads of agencies under the Government, and Chairmen of People's Committees of provinces and centrally-administered cities shall be responsible for directing and guiding the implementation thereof.

2. Administrative agencies and public service units shall be responsible for developing plans to implement regulations on staffing and wages to apply the new minimum wage rate in a transparent and democratic manner as prescribed by law, and submit them for approval by competent authorities prior to implementation.

3. Ministries, sectors, provincial People's Committees shall organize reviews of the plans and decide in writing within their authority for agencies and units to implement; guide, inspect, and resolve any issues arising during the implementation process for agencies, units, and individuals under their jurisdiction.

V. IMPLEMENTATION PROVISIONS

This Circular shall take effect concurrently with the effectiveness of Decree No. 03/2003/NĐ-CP dated January 15, 2003 of the Government.

Salaries and wages of civil servants, public officials, and employees in administrative agencies and public service units subject to this Circular shall be effective from January 1, 2003.

Any difficulties encountered during the implementation should be reported to the Ministry of Home Affairs for study and resolution.