Decree No. 141/2007/ND-CP on salary regulations for state-owned parent companies and subsidiaries within economic groups

DECREE

Regulations on wage systems for state-owned parent companies and subsidiaries within economic groups

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THE GOVERNMENT

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Pursuant to the Labor Code dated June 23, 1994; Law Amending and Supplementing Certain Provisions of the Labor Code dated April 2, 2002;

Pursuant to the State Enterprise Law dated November 26 2003, the Enterprise Law dated November 28, 2005;

Pursuant to Resolution No. 71/2006/QH11 dated November 29 2006 of the National Assembly, Session XI;

Considering the proposal of the Minister of Labor, Invalids, and Social Affairs,

DECREE:

Article 1. Scope of application

This Decree stipulates the wage system, salary allowances, and management of wages for state-owned parent companies (hereinafter referred to as parent company) and subsidiaries within economic groups.

Article 2. Applicability

1Workers employed under labor contracts in the parent company and subsidiaries shall comply with the provisions of the labor laws.

2. Members of the Board of Directors, members of the Board of Members (or Chairman of the Company), Supervisors, General Director, Deputy General Directors, and Chief Accountants of the parent company (excluding General Directors, Deputy General Directors, and Chief Accountants working under contracts).

3 .Members of the Board of Directors, members of the Board of Members (or Chairman of the Company), Supervisors, General Directors, Directors, Deputy General Directors, Deputy Directors, and Chief Accountants of subsidiaries.

4. Persons appointed to represent the contributed capital of the parent company in subsidiaries.

Article 3. The wage system for the parent company and subsidiaries within economic groups shall be implemented based on the following principles:

1. Wages must be linked to labor productivity, business efficiency, be consistent with market wages, and gradually integrate.

2. Ensuring the autonomy and responsibility of each company in determining wages and bonuses for workers.

3. The State establishes the wage system for the parent company and subsidiaries within economic groups. The parent company guides and manages the wages of subsidiaries in accordance with the economic group's policy and labor laws.

Article 4. Wage system for the parent company

1. Workers employed under labor contracts in the parent company shall be classified according to the following wage scales and allowances:

a) For state-owned parent companies, they shall implement the wage scales, pay tables, and allowance regulations as stipulated in Government Decree No. 205/2004/NĐ-CP dated December 14, 2004, which regulates the wage scale, pay table, and allowance system in state-owned companies;

b. For parent companies that are limited liability companies wholly owned by the State, they shall implement Government Decree No. 86/2007/NĐ-CP dated May 28, 2007, which regulates labor management and wages in limited liability companies wholly owned by the State.

2. Members of the Board of Directors, members of the Board of Members (or Chairman of the Company), Supervisors, General Directors, Deputy General Directors, and Chief Accountants and Heads of Departments, Deputy Heads of Departments shall be classified according to the following wage scales and allowances:

a) For parent companies within economic groups established by decision of the Prime Minister:

- Position salary coefficient:

+ Chairman of the Board of Directors, specialized Chairman of the Board of Members (or specialized Chairman of the Company): 8.80 - 9.10;

+ Specialized member of the Board of Directors, specialized member of the Board of Members: 7.90 - 8.20;

+ General Director: 8.50 - 8.80;

+ Deputy General Director: 7.90 - 8.20;

+ Chief Accountant: 7.60 - 7.90.

- Position allowance coefficient:

+ Head of Department, specialized Supervisor and equivalent: 0.8;

+ Deputy Head of Department and equivalent: 0.7.

- Responsibility work allowance coefficient:

+ Non-specialized Chairman of the Board of Members (or non-specialized Chairman of the Company): 0.8;

+ Non-specialized member of the Board of Directors, non-specialized member of the Board of Members: 0.7.

The position salary and allowance coefficients specified herein shall be calculated relative to the national minimum wage published by the Government, serving as the basis for calculating employee benefits as stipulated in Article 5 of Government Decree No. 205/2004/NĐ-CP dated December 14, 2004.

b) For parent companies within economic groups approved by the Prime Minister for establishment plans and assigned to Ministers, Heads of Ministries equivalent to the Government, Heads of Government agencies, Chairmen of provincial People's Committees directly under the Central Government to establish, shall be classified according to the special total company regulations stipulated in Government Decree No. 205/2004/NĐ-CP dated December 14, 2004.

3. Management of wages for workers employed under labor contracts and Deputy General Directors, Chief Accountants shall be carried out as follows:

a) For state-owned parent companies, they shall implement the provisions of Government Decree No. 206/2004/NĐ-CP dated December 14, 2004, which regulates labor management, wages, and income in state-owned companies, and Article 4 of Government Decree No. 94/2006/NĐ-CP dated September 7, 2006, adjusting the national minimum wage.

For companies meeting the conditions stipulated in Article 4 of Government Decree No. 206/2004/NĐ-CP dated December 14, 2004, and having planned profits at least 5% higher than the previous year's actual profits, they may apply an additional adjustment factor not exceeding twice the national minimum wage published by the Government as the basis for calculating the unit wage rate. The unit wage rate must be registered with the owner's representative before implementation. For parent companies within economic groups established by decision of the Prime Minister, registration shall be made with the Ministry of Labor, Invalids and Social Affairs, and the Ministry of Finance.

For parent companies that are limited liability companies wholly owned by the State, they shall implement Government Decree No. 86/2007/NĐ-CP dated May 28, 2007.

b) 4. The wage system, bonuses, and responsibility system for members of the Board of Directors, members of the Board of Members (or Chairman of the Company), Supervisors, General Directors shall be implemented as follows:

4. The wage system, bonus system, and liability regime for Board of Directors members, Members of the Member Council or the Company Chairman, Supervisors, and General Directors shall be implemented as follows:

a) For state-owned parent companies, implement according to the provisions of Decree No. 207/2004/NĐ-CP dated December 14, 2004 of the Government on wage and bonus systems and responsibility regimes for members of the Board of Directors, General Managers, and Directors of state-owned enterprises.

The planned wage fund of Board of Directors members and General Managers must be reported to the owner's representative for review before implementation. For parent companies within economic groups established by the Prime Minister's decision, they must register their planned wage funds with the Ministry of Labor, Invalids and Social Affairs and the Ministry of Finance.

b) For parent companies that are single-member limited liability companies wholly owned by the State, implement according to Decree No. 86/2007/NĐ-CP dated May 28, 2007 of the Government.

5. Production and business indicators to determine unit wage rates and planned wage funds as stipulated in Clause 3 and Clause 4 of this Article include activities from production and business operations; financial activities and other activities of the parent company as prescribed by law.

Article 5. Wage system for subsidiaries in economic groups

1. For independent accounting member companies during the period not yet converted as provided for in the Enterprise Law 2005; Holding Companies, companies operating under the parent-subsidiary model, and single-member limited liability companies owned by the parent company:

a) Workers employed under labor contracts, members of the Board of Directors, members of the Board of Members (or Company Chairmen), Supervisors, General Managers, Directors, Deputy General Managers, Deputy Directors, Chief Accountants shall be classified and paid wages and allowances according to Decree No. 205/2004/NĐ-CP dated December 14, 2004 and Decree No. 86/2007/NĐ-CP dated May 28, 2007 of the Government;

For companies meeting the following conditions, members of the Board of Directors, members of the Board of Members (or Company Chairmen), Supervisors, General Managers, Directors, Deputy General Managers, Deputy Directors, Chief Accountants shall be classified and paid wages and allowances according to Special Holding Companies or Holding Companies:

- Wages and allowances shall be classified according to Special Holding Companies for companies meeting the following conditions:

+ Playing a significant role in economic groups established by the Prime Minister's decision;

+ Having a charter capital of VND 700 billion or more; profits of VND 70 billion or more; paying VND 70 billion or more to the state budget;

+ Having at least 10 subsidiary units.

- Wages and allowances shall be classified according to Holding Companies for companies meeting the following conditions:

+ Having a charter capital of VND 500 billion or more; profits of VND 50 billion or more; paying VND 50 billion or more to the state budget;

+ Having at least five subsidiary units.

b) Management of wages and bonuses for members of the Board of Directors, members of the Board of Members (or Company Chairmen), Supervisors, General Managers, Directors, Deputy General Managers, Deputy Directors, Chief Accountants, and workers employed under labor contracts shall be carried out as follows:

- For independent accounting member companies, Holding Companies, and companies operating under the parent-subsidiary model, implement according to Decree No. 206/2004/NĐ-CP and Decree No. 207/2004/NĐ-CP dated December 14, 2004 of the Government;

- For single-member limited liability companies owned by the parent company, implement according to Decree No. 86/2007/NĐ-CP dated May 28, 2007 of the Government.

c) Unit wage rates and planned wage funds of members of the Board of Directors, members of the Board of Members (or Company Chairmen), Supervisors, General Managers, and Directors must be reported to the parent company for review before implementation.

2. For limited liability companies with two or more shareholders, joint-stock companies, and foreign joint ventures

The construction of wage scales, allowance tables, determination of wage funds, and bonuses shall be carried out according to Decree No. 114/2002/NĐ-CP dated December 31, 2002 of the Government detailing and guiding the implementation of certain provisions of the Labor Code regarding wages.

Specifically, for companies where the parent company holds over 50% of the charter capital, the wage plan must be registered with the parent company before implementation.

3 . For overseas companies

The construction of wage scales, allowance tables, determination of wage funds, and bonuses shall be carried out according to the laws of the host country.

Specifically, for overseas companies wholly owned by the parent company, the wage scale, allowance table, wage fund, and bonus plan must be reported to the parent company for review before implementation.

Article 6. Responsibilities of the parent company and subsidiaries

1.Responsibilities of the parent company:

a) Develop and issue labor policies and wage systems within economic groups;

b) Report to the Ministry of Labor, Invalids and Social Affairs for consideration and submit to the Prime Minister for approval the classification of wages and allowances according to Special Holding Companies or Holding Companies for subsidiaries meeting the conditions specified in Point a, Clause 1, Article 5 of this Decree;

c) Accept registration forms for unit wage rates and review planned wage funds of subsidiaries that are independent accounting member companies; Holding Companies, and single-member limited liability companies;

d) Direct representatives of equity interests to guide and require subsidiaries to develop wage scales, allowance tables, wage plans, and bonus schemes consistent with the economic group's policies and report to the parent company on the implementation status of subsidiaries they represent;

đ) By the first quarter of each year, report to the Ministry of Labor, Invalids and Social Affairs and the Ministry of Finance the implementation status of production and business targets, labor, and wages of the previous year and the plan for the current year for parent companies and subsidiaries classified as special categories within economic groups established by the Prime Minister's decision; remaining economic groups report to their respective owners represented by ministries, agencies equivalent to ministries, central government agencies, provincial people's committees, and municipal people's committees directly under the central government.

e) Establish plans for the payment of responsibility allowances and bonuses for individuals appointed to represent equity interests in subsidiaries according to the provisions of the law;

g) Determine the actual wage fund, bonus fund, and wages and bonuses paid to employees based on labor productivity and business efficiency according to the company's wage regulations and bonus regulations;

h) Inspect and supervise subsidiaries in implementing the provisions of this Decree;

2. Responsibilities of subsidiaries:

a) For independent accounting member companies; holding companies, companies under the parent-subsidiary model; single-member limited liability companies owned by the parent company:

Propose the parent company to report to the Ministry of Labor - Invalids and Social Affairs for the Prime Minister's decision on salary grading and allowance according to special holding companies or holding companies;

- In the first quarter of each year, report to the parent company on the implementation of production and business plans, profits, labor, wages, bonuses of the previous year, and the plan for the planning year as stipulated in Article 5 of this Decree and the Company Charter, while sending the local tax authority the unit price of wages and planned wage fund as the basis for calculating taxes;

- Determine the actual wage fund, bonus fund, and wages and bonuses paid to employees based on labor productivity and business efficiency according to the company's wage regulations and bonus regulations;

b) For limited liability companies with two or more members, joint-stock companies, foreign-invested joint ventures:

Develop wage scales, salary tables, allowance systems, and register with the provincial Department of Labor - Invalids and Social Affairs where the main office of the company is located;

In the first quarter of each year, report to the parent company on the implementation of production and business plans, profits, labor, wages, bonuses of the previous year, and the plan for the planning year as stipulated in Article 5 of this Decree and the Company Charter, while sending the local tax authority the unit price of wages and planned wage fund as the basis for calculating taxes;

- Determine the actual wage fund, bonus fund, and wages and bonuses paid to employees based on labor productivity and business efficiency according to the company's wage regulations and bonus regulations;

c) For companies abroad:

- Implement reporting systems on labor, wages, and bonuses according to the laws of the host country;

- In the first quarter of each year, report to the parent company on the results of production and business activities, profits, labor, wages, bonuses of the previous year, and the plan for the planning year;

Article 7. Responsibilities of Ministries, agencies at the ministerial level, government agencies, provincial People's Committees directly under the central government towards economic groups they represent as the owner:

1.Receive registration of labor usage plans, unit prices of wages, and planned wage funds of the parent company;

2. Coordinate with the Ministry of Labor - Invalids and Social Affairs, the Ministry of Finance to submit to the Prime Minister for salary grading and allowance according to special holding companies and holding companies for subsidiaries; inspect the determination of the wage fund for Board of Directors members, Board of Members members (or Company Chairmen), Supervisors, General Managers, and Directors of the parent company and subsidiaries that have been graded and allowed salaries according to special holding companies within economic groups decided by the Prime Minister to establish;

Article 8. Responsibilities of the Ministry of Labor - Invalids and Social Affairs:

1. Take the lead and coordinate with the Ministry of Finance and other Ministries, agencies at the ministerial level, government agencies, provincial People's Committees directly under the central government as stipulated in Article 7 of this Decree to submit to the Prime Minister for salary grading and allowance according to special holding companies or holding companies for subsidiaries meeting the conditions specified in point a, Clause 1. Article 5 of this Decree; inspect the determination of the unit price of wages and the planned wage fund for members of the Board of Directors, members of the Board of Members (or Chairman of the company), Supervisors, General Directors of the parent company and subsidiary companies under the Special Corporation.

2. Guide and inspect the implementation of the provisions of this Decree for State Economic Groups.

Article 9. Effectiveness

This Decree shall take effect fifteen days after its publication in the Official Gazette.

VThe determination of the unit price of wages and the planned wage fund for 2007 for members of the Board of Directors, members of the Board of Members (or Chairman of the company), Supervisors, General Directors, Directors of the parent company and subsidiary companies shall be carried out in accordance with the provisions of this Decree.

Article 10. Ministers, Heads of ministerial-level agencies, Heads of government agencies, Chairmen of provincial People's Committees under central cities, and Boards of Directors of State Economic Groups are responsible for implementing this Decree./.