Joint Circular No. 39-TĐ/TC-LĐ guiding the reward system for outstanding achievement awards and end-of-year performance bonuses

JOINT CIRCULAR

Guidelines on incentive systems for commendation titles and annual task completion bonuses

All legitimate income of cadres, workers, civil servants, and laborers mainly comes from basic salary, piece-rate pay, product-based pay, which includes benefits based on actual level and productivity.

Commendation titles recognize outstanding labor achievements of workers. Commendation bonuses are additional distribution forms for those who have made contributions, based on their benefits created. The assessment of commendation titles must be strict, taking into account the benefits created, and should not be awarded indiscriminately.

To unify nationwide, with the agreement of the Vietnam General Confederation of Labor, the National Motivation Committee, the Ministry of Finance, and the Ministry of Labor provide guidelines for awarding commendation titles and annual task completion bonuses as follows:

1/ Source of bonus funds

Bonus funds for commendation titles in production and business units come from the approved annual reward fund of the unit.

Bonus funds for commendation titles in administrative and public service agencies are taken from 5% of the salary grade or position salary fund according to Article 7 of Decree 235-HDBT dated September 18, 1985, on improving the wage system for workers, civil servants, and armed forces.

Commendation bonuses for cooperatives and production groups come from the funds of these entities according to the resolutions of the member congresses.

Commendation bonuses must be used strictly for rewarding purposes and cannot be evenly distributed among all cadres, workers, and staff members.

Higher-level management agencies shall not use bonus funds from production and business units to reward their own cadres and staff, as these agencies already have bonus funds under state regulations.

2/ Usage and distribution of bonus funds:

Each unit bases its distribution on its own bonus fund capacity, with the head discussing with the trade union to allocate as follows:

- A small portion for the head to reward outstanding achievements

- A portion to reward advanced teams and socialist labor teams

- A large portion to reward individuals achieving advanced laborer and model worker titles according to Circular 115-TĐTV dated December 9, 1985, issued by the National Motivation Committee, and annual task completion bonuses according to the guidance circular of the Ministry of Labor

Bonuses for advanced teams and socialist labor teams are given to the collective, with the socialist labor team bonus being twice the amount of the advanced team bonus. The team will redistribute to individuals based on their achievement levels, decided by the collective but not equally.

Individual rewards follow the principle: A grassroots model worker receives a bonus equal to twice that of an advanced laborer each period, with a maximum of half a month's basic salary (grade or position salary) of the recipient.

3/ Model workers at the district level and above only receive commemorative gifts (in cash or kind). Therefore, the reward for higher-level model workers should not exceed that of grassroots model workers.

Gifts for district, provincial, city, and national-level model workers, if they are workers in production and business units, are funded from the unit's bonus fund according to the amount specified by the recognizing authority.

Gifts for district, provincial, city, and national-level model workers, if they are administrative and public service staff, are determined by the recognizing authority. If recognized by local authorities, the cost is covered by the local budget. If recognized by central ministries, it is funded from the ministry's fund. If there is no such fund, it is covered by the central budget, approved by the Ministry of Finance.

4/ Several points to note when selecting titles and granting awards:

- Commendation titles are awarded to those with outstanding achievements in labor or work, exceeding assigned tasks. Therefore, individuals who have been ill or on maternity leave for more than one month without special outstanding achievements (such as valuable initiatives, record-breaking productivity, bravery in protecting production and assets) are not eligible for awards.

- The distribution of bonuses for advanced workers should be conducted every six months to promptly motivate the competition spirit.

- Unit heads must establish internal rules for using the unit's bonus fund annually, presenting them at the beginning-of-year employee conference, specifying the allocation of various rewards, and planning the scope and levels of various commendation titles.