Circular No. 4-LDTT temporarily establishes principles, contents, and explanations guiding the implementation of the piece-rate wage system.

CIRCULAR

PROVISIONALLY ESTABLISH THE PRINCIPLES, CONTENTS, AND GUIDANCE FOR IMPLEMENTING THE SYSTEM OF WAGES BASED ON OUTPUT

THE MINISTER OF LABOR

ARTICLE 13 OF DECREE NO. 182-TTg DATED APRIL 7, 1958, ISSUED BY THE PRIME MINISTER REGARDING IMPROVEMENT AND INCREASE OF WAGES IN 1958 PROVIDES THAT "THE MINISTRY OF LABOR WILL ADJUST AND EXPAND GRADUALLY THE IMPLEMENTATION OF THE SYSTEM OF WAGES BASED ON OUTPUT STEP BY STEP UNDER LEADERSHIP."

NOW THE MINISTRY OF LABOR ISSUES THIS CIRCULAR TO GUIDE THE IMPLEMENTATION OF THE ABOVE MENTIONED TASK.

I. OBJECTIVES AND SIGNIFICANCE OF PAYING WAGES BASED ON OUTPUT

DURING THE IMPROVEMENT OF THE WAGE SYSTEM AND INCREASE OF WAGES IN 1958, THE PARTY AND THE GOVERNMENT DECIDED TO ADJUST AND EXPAND GRADUALLY THE IMPLEMENTATION OF THE SYSTEM OF WAGES BASED ON OUTPUT STEP BY STEP UNDER LEADERSHIP.

THE DISTRIBUTION PRINCIPLE OF MATERIAL WEALTH IN SOCIALISM IS DISTRIBUTION ACCORDING TO LABOR; WAGES BASED ON OUTPUT IS A FORM OF WAGES APPLIED ACCORDING TO THIS PRINCIPLE. CURRENTLY IN OUR COUNTRY, PRODUCTIVITY IS STILL VERY LOW, LABOR DISCIPLINE IS POOR, ENTERPRISE MANAGEMENT IS INEXPERIENCED, AND WORKER EDUCATION IS STILL AT AN EARLY STAGE; THEREFORE, THE FORM OF CONTRACTUAL WAGES (WAGES BASED ON OUTPUT) NEEDS TO BE MAINTAINED AND STRENGTHENED WHERE IT HAS BEEN IMPLEMENTED, WHILE ALSO NEEDING TO BE DEVELOPED WHERE CONDITIONS PERMIT AND ARE NECESSARY. THIS WILL HAVE SEVERAL ADVANTAGES:

- HELP ENTERPRISE MANAGEMENT TO BEGAN TO BE REGULARIZED MORE QUICKLY.

- ENCOURAGE WORKERS TO BE MORE ENTHUSIASTIC IN PRODUCTION AND ATTENTIVE TO IMPROVING TECHNICAL SKILLS.

CORRECT IMPLEMENTATION OF WAGES BASED ON OUTPUT WILL ENCOURAGE THE MOVEMENT OF COMPETITION TO IMPROVE TECHNOLOGY AND ORGANIZE LABOR, TRAIN OCCUPATIONS, AND IMPROVE THE LIVING STANDARDS OF WORKERS AND EMPLOYEES.

TO IMPLEMENT WAGES BASED ON OUTPUT, FIRSTLY, IT IS NECESSARY TO PAY ATTENTION TO THE EDUCATION OF SOCIALIST IDEAS SO THAT EVERYONE VOLUNTARILY AND CONSCIOUSLY ENGAGES IN SOCIAL LABOR FOR THE BENEFIT OF BUILDING SOCIALISM AND UNIFYING THE COUNTRY, CONTINUOUSLY IMPROVING PRODUCTIVITY, QUALITY, REDUCING COSTS TO IMPROVE THE LIVING STANDARDS OF THE PEOPLE AND EXPANDING PRODUCTION.

IMPLEMENTING WAGES BASED ON OUTPUT MUST FOLLOW THE POPULAR LINE, BE APPROVED BY THE POPULARITY, AND ACTIVELY PARTICIPATE. THIS IS A CRITICAL FACTOR.

HOWEVER, ON THE OTHER HAND, IT IS ALSO NECESSARY TO ORGANIZE CAREFULLY, GO DEEP INTO PRODUCTION, UNDERSTAND THE PRODUCTION SITUATION, PUBLIC OPINION, CALCULATE SPECIFICALLY, CAREFULLY CONSIDER THE ADVANTAGES AND DISADVANTAGES, CONDITIONS, AND LONG-TERM CAPABILITIES BEFORE APPLYING WAGES BASED ON OUTPUT, WHICH CAN PROMOTE PRODUCTION AND SIMULTANEOUSLY STRENGTHEN INTERNAL UNITY AMONG WORKERS AND EMPLOYEES.

IT IS NECESSARY TO ACTIVELY CREATE CONDITIONS AND RESOLVE DIFFICULTIES TO EXPAND THE SYSTEM OF WAGES BASED ON OUTPUT WHERE POSSIBLE. BUT IT IS ALSO NECESSARY TO BE CAUTIOUS, NOT TO EXPAND WITHOUT PLANNING, WHICH COULD LEAD TO WASTAGE, INAPPROPRIATE USE OF RAW MATERIALS, AND PRODUCTION OF SUBSTANDARD PRODUCTS.

THE ADVANTAGES OF PAYING WAGES BASED ON OUTPUT ARE CLEAR:

1. PAYING WAGES BASED ON OUTPUT REQUIRES A RELATIVELY RATIONAL ORGANIZATION OF LABOR TO BE EFFECTIVE, WITH FULL AND TIMELY EQUIPMENT AND RAW MATERIALS. ANY SHORTCOMINGS IN ENTERPRISE MANAGEMENT (SUCH AS MACHINE BREAKDOWNS, LACK OF TOOLS, INADEQUATE SUPPLY OF RAW MATERIALS, ETC.) THAT HINDER PRODUCTION WILL AFFECT THE PRODUCTIVITY AND WAGES OF WORKERS. THEREFORE, WAGES BASED ON OUTPUT ENCOURAGE MANAGERS TO IMPROVE MANAGEMENT AND WORKERS TO ACTIVELY PROVIDE FEEDBACK TO MANAGERS TO QUICKLY ADDRESS SHORTCOMINGS. AT THE SAME TIME, WORKERS MUST SUPPORT EACH OTHER TO ENSURE THAT THE PRODUCTION LINE IS NOT INTERRUPTED.

2. WAGES BASED ON OUTPUT SETS A TARGET FOR WORKERS TO STRIVE FOR, MAKING IT A STANDARD FOR COMPETITIVE PERFORMANCE, WHICH STIMULATES WORKERS TO ENTHUSIASTICALLY ENGAGE IN LABOR, SHOW CREATIVITY IN PRODUCTION, AND BE ENTHUSIASTIC ABOUT LEARNING NEW PRODUCTION METHODS, EXCHANGING OCCUPATIONS, AND IMPROVING THEIR TECHNICAL AND CULTURAL LEVELS. THEREFORE, WAGES BASED ON OUTPUT PROMOTES THE DEVELOPMENT OF THE COMPETITIVE PRODUCTION MOVEMENT, ENABLING WORKERS' ABILITIES TO DEVELOP MORE COMPREHENSIVELY.

3. ADDITIONALLY, WAGES BASED ON OUTPUT ENSURES THE IMPLEMENTATION OF THE SOCIALIST WAGE PRINCIPLE "DISTRIBUTION ACCORDING TO LABOR," ALLOWING WORKERS' INCOME TO INCREASE DIRECTLY WITH PRODUCTIVITY, WHICH PROMOTES THE TIMELY REWARD OF ACTIVE AND HIGH-PERFORMING WORKERS.

THE NORTH OF OUR COUNTRY HAS ENTERED THE TRANSITIONAL PERIOD TO SOCIALISM AND BEGUN ECONOMIC CONSTRUCTION ACCORDING TO THE LONG-TERM PLAN. THE IMMEDIATE TASK IS TO STRIVE TO PRODUCE AND SAVE, TO STRENGTHEN PRODUCTION, IMPLEMENT THE STATE PLAN, AND IMPROVE THE LIVING STANDARDS OF THE PEOPLE. THE IMPLEMENTATION OF THE SYSTEM OF WAGES BASED ON OUTPUT HAS A SIGNIFICANT MEANING. WITH THE ABOVE ADVANTAGES, IT IS ONE OF THE KEY FACTORS GUARANTEEING THE CONTINUOUS IMPROVEMENT OF LABOR PRODUCTIVITY, THE CONTINUOUS DEVELOPMENT OF PRODUCTION, THE SLOW REDUCTION OF COSTS, AND ON THIS BASIS, THE IMPROVEMENT OF THE LIVING STANDARDS OF WORKERS.

IN THE PAST PERIOD, IN SOME ENTERPRISES AND CONSTRUCTION SITES, THE IMPLEMENTATION OF THE SYSTEM OF WAGES BASED ON OUTPUT HAS HAD A CERTAIN EFFECT IN ENCOURAGING WORKERS TO INCREASE PRODUCTIVITY, EXERT INITIATIVES, ENSURE THE COMPLETION OF THE STATE PLAN, AND INCREASE WORKERS' INCOME. HOWEVER, DUE TO INADEQUATE LEADERSHIP, MANY DIFFICULTIES AND COMPLEX SITUATIONS SUCH AS INEXPERIENCE IN ENTERPRISE MANAGEMENT, INAPPROPRIATE WAGE RATES, INSUFFICIENT SPECIALIZED STAFF, AND INACCURATE STANDARDS, THE IMPLEMENTATION OF THE SYSTEM OF WAGES BASED ON OUTPUT HAS INCURRED SOME SHORTCOMINGS.

TO TIMELY ENCOURAGE WORKERS TO ENTHUSIASTICALLY ENGAGE IN LABOR, INCREASE PRODUCTIVITY, LOWER PRODUCTION COSTS, ENSURE THE COMPLETION AND EXCEEDANCE OF THE STATE PLAN, WITH THE EXPERIENCES GAINED AND BASED ON THE IMPROVED WAGE SCALE, IT IS NOW NECESSARY TO PROGRESSIVELY ADJUST AND EXPAND THE SYSTEM OF WAGES BASED ON OUTPUT IN A PLANNED AND LED MANNER.

II. CONDITIONS FOR PREPARING THE IMPLEMENTATION OF PIECEWORK PAY SYSTEM

Circular No. 197-TTg dated April 17, 1958 of the Prime Minister (Part III, Section 4) provides: "State enterprises need to study and adjust gradually to apply the piecework pay system carefully; for those enterprises and construction sites that have sufficient necessary conditions, implement the piecework pay system; for those places that do not yet have sufficient conditions, they must prepare thoroughly before implementing the piecework pay system; for those places where it has been implemented but there are deviations, they must be corrected and adjusted appropriately..." The piecework pay system has many advantages, but it must be suitable with the characteristics, production requirements, and demand specific conditions. There are two main conditions:

1. Production organization must be relatively stable and production requires an increase in quantity or a reduction in time to complete and exceed the plan.

2. The nature of production can determine the level and monitor the quantity and quality of products.

Without one of the above two conditions, the piecework pay system cannot be implemented. Having the basic conditions mentioned above, it is still necessary to prepare carefully in terms of ideology, organization, and standards to ensure the successful implementation of the piecework pay system.

1. Preparation in terms of ideology:

It is necessary to attach importance to education on policy, ideological leadership to make cadres and workers understand the purpose, significance, principles, and content of the piecework pay system, distinguish the fundamental differences from the imperial wage system, recognize the main purpose of the piecework pay system is to improve labor productivity, reduce costs, and develop production. On this basis, the income of workers will increase reasonably. It is necessary to make cadres clearly see that implementing piecework pay is an important task in leading production and managing enterprises, avoiding viewing it solely as a means to increase workers' income, thus simplifying it without strict leadership. Conversely, it is also necessary to avoid perfectionist thinking, fear of difficulties, lack of determination to overcome difficulties, creating conditions for the implementation of the piecework pay system; at the same time, guard against the idea that the piecework pay system itself has many advantages while neglecting political work and organizational work, emphasizing only the material incentive effect of wages while neglecting political education and ideological work for the masses.

For workers, it is necessary to attach importance to propaganda and education on socialism to raise their awareness of socialist labor and their sense of ownership, making them understand that individual interests cannot be separated from national interests, short-term benefits must yield to long-term benefits. Prioritize collective interests first, linking with personal interests, have a working attitude of the class in charge of society, emphasize a sense of responsibility for the task of building the northern region towards socialism and unifying the country, striving to increase labor productivity, producing more, faster, better, cheaper, and completing the state plan well. Based on good socialist ideological education, the implementation of the piecework pay system will have the conditions to improve labor productivity, increase product quality, and reduce costs. Thinking only about short-term interests, working carelessly, producing more without ensuring technical standards and product quality, or wanting to lower levels to make it easier to exceed targets is contrary to the purpose, significance, and principles of the piecework pay system.

2. Preparation in terms of organization:

In the enterprise management team, one person must be assigned to directly oversee the implementation of the piecework pay system to assist the management team in leading its implementation effectively. Additionally, in bureaus, departments, companies, enterprises, and construction sites, there must be specialized staff responsible for the piecework pay system. Depending on the size of the unit, train a number of necessary staff with policy and professional knowledge to regularly support the enterprise management team in leading the implementation of the piecework pay system.

In addition, the organizational tasks that need to be prepared include:

- Adjusting the labor organization reasonably, using workers according to their skills, closely matching the requirements of each department, avoiding surplus or shortage.

- Improving the use and supply of machinery, tools, raw materials reasonably, timely, and adequately to ensure continuous production.

- Establishing clear responsibilities for each person and department, strictly implementing statistics, inspection, and acceptance of product quantity and quality, planning close cooperation between departments, strengthening labor protection and safety technology work.

- Planning to improve living conditions, political, professional, technical, and cultural training for workers and staff.

3. Preparation in terms of standards and wage rates:

Accurate standards are the basis for the reasonable implementation of the piecework pay system. Standards are also a difficult and complex task. Therefore, staff must delve deeply into production conditions and worker proficiency to research standards well before implementing the piecework pay system.

Based on good standards and relatively reasonable worker grading, the determination of piecework wage rates will be accurate.

In summary, it is necessary to analyze production characteristics and conditions and do preparatory work well. The more comprehensive the preparation in terms of ideology, organization, standards, and wage rates, the more results the implementation of the piecework pay system will achieve. However, it should not be overly cautious, waiting for all conditions to be fully met before implementing. Leading according to the mass line, the process of implementing the piecework pay system will create favorable conditions for successful implementation.

III. CONTENT AND METHODS OF IMPLEMENTATION

1. Standards:

a) To implement the piecework pay system well, it is necessary to set standards accurately and reasonably grade wages. Wage grades represent the quality of labor, and levels represent the quantity of labor.

a) To implement a piece-rate wage system effectively, it is necessary to set standards accurately and to establish wage grades reasonably. Wage grades represent the quality of labor, and standard levels represent the quantity of labor.

Standards are a significant issue, affecting labor productivity improvement, labor organization and distribution, wage distribution, and workers' income.

Standards can be time standards or output standards:

- Time standards define the necessary time for a worker to complete a specified product according to predetermined technical specifications.

- Output standards define the quantity of products a worker must complete within a specified period.

b) Output standards for wage payment must be advanced average levels, meaning finding the average level achieved by most workers and then raising it to an advanced level. Outdated standards or those based on the majority's already achieved levels cannot be used, nor should they be set at the exceptionally high level of the most advanced worker. Standards must reflect progressive factors in production (technical aspects, innovations, machinery, tools, new labor organization) to stimulate latent production capacity in enterprises, making them targets for workers' efforts during production struggles. The level established should be such that the majority of workers, with consistent effort and mastery of new techniques, can achieve and exceed it.

At the same job level, performing the same work with identical production means and conditions, the standards must be the same.

Since 1958, wages have gradually been incorporated into plans. Therefore, standards must also align with the state's wage plan, ensuring appropriate proportional relationships between production plans and wage increases. High or low standards affect labor productivity and average wage targets. Low standards make it too easy for workers to exceed them, not only failing to encourage workers'积极性和创新，而且会导致劳动生产率计划未完成而工资却超额的情况，造成不同工种工人之间工资关系不良。相反，标准过高会影响工人的收入和工作热情，同时导致不合理的情况：劳动生产率计划、生产计划完成或超额完成，但工资计划未完成，工人工资没有得到适当的增加。

c) Regarding the method of setting advanced average standards based on technical grounds, depending on the specific situation of each place, the method guided by Circular No. 24-LD-TT dated November 30, 1957, of the Ministry of Labor shall be applied:

The best method of setting standards is to:

a) Fully study and examine the workplace location, working conditions and environment, machine capacity utilization, workers' working methods, labor force distribution and usage, raw material and tool supply... to see if they are reasonable.

b) Based on the analysis results and the advanced experience of workers, improve the work system, more effectively utilize machine capacity and equipment, and rationally organize workplace locations and working methods.

c) On the basis of improved work systems, new arrangements for using machines and equipment, and new working methods, calculate and analyze to determine time or output standards.

Such standards set through the technical quota method ensure that, with assistance from cadres, the majority of workers grasp the new techniques of their jobs and can achieve and exceed the standards with effort.

Before determining standards according to the aforementioned method, temporarily apply the statistical experience method combined with careful consideration of progressive factors that can enhance standards.

Setting standards based on statistical experience involves basing standards on production statistics and experiences of each skill level, but it is necessary to focus on analyzing labor organization and working methods to identify unreasonable points needing correction to establish standards. Avoid simply relying on statistical data and using a fixed formula for calculation without thorough research and analysis.

Standard setting is proposed by the enterprise director, submitted to workers for comments,试行一段时间，修正不准确的标准后，再正式决定并公布。避免采用民主评议的方法来确定标准。工会和青年团有责任领导和鼓励工人广泛参与意见，以建立良好的标准。

Standards must go hand in hand with the dissemination of advanced experiences. Once new standards are established, cadres have the responsibility to create conditions, provide adequate means, and assist workers in achieving and exceeding the standards.

2. Changing standards:

For regular and long-term tasks in industrial enterprises, the review period for standards is temporarily set from three months to one year.

Within the range of three months to one year, each enterprise may specify the appropriate review period based on its specific circumstances. If the initial standards are relatively accurate and based on technical grounds, the review period can be extended to one year. In cases where standards are based on statistical experience and are not yet accurate, the review period may be shorter (for example, six months).

As production technology and equipment in enterprises are constantly improving, workers' technical skills and cultural levels are continuously rising, and their creative abilities are being further unleashed, labor organization and production organization are always being reasonably improved, so even initially accurate standards need periodic reviews. However, it is not necessary to change all standards just because the review period has arrived. After reviewing the standards, if some old standards still retain their advanced nature and there are no factors affecting the old standards, they can continue to be implemented.

The adjustment of levels must avoid changing too quickly, which would cause workers to lose enthusiasm and confidence, always pursuing new levels while affecting workers' income. Conversely, levels should not remain unchanged for too long, becoming outdated and ineffective in encouraging workers to improve their positivity and creativity to achieve and exceed levels, leading to wastage of wage funds.

For basic construction sites, agricultural farms, and forestry farms, due to the nature of mobile and scattered work and the influence of natural conditions and weather, level adjustments need to be flexible and timely, with review periods possibly shorter than those of industrial enterprises and will be regulated by the relevant ministry.

In the following cases, levels may be adjusted even before the scheduled review period:

a) Changes in working conditions (becoming more convenient or difficult than before).

b) Changes in production technology and work methods according to the guidance of the enterprise management board. When innovative ideas or inventions have been widely promoted and applied by workers, levels will be adjusted.

c) Changes in machinery, tools, and raw materials.

d) Changes in production organization and labor organization.

e) Changes in technical specifications and product quality standards.

g) When there are significant errors in determining the levels.

Adjustments to levels must also follow the method mentioned above in Section 2, that is, observing all aspects of production, analyzing thoroughly, and considering progressive factors that enhance productivity levels, in summary, it must be based on technical grounds.

After adjusting levels, staff must provide in-depth assistance and guidance to workers to apply advanced experiences, grasp new techniques, and achieve and surpass new levels, thereby increasing workers' income in line with the pace of labor productivity growth.

3. Reviewing Levels:

To move towards strict management of levels based on which to advance towards strict management of wage funds and staffing, from now on, levels established by enterprises and construction sites must be reviewed by leadership, depending on the level of management authority over levels. If the enterprise or construction site is under the management of a local administrative committee, then the levels will be reviewed by the administrative committee.

For levels announced and implemented by the State Planning Commission, Ministries, or Bureaus, enterprises and construction sites must base their application on their specific production conditions, ensuring appropriate measures are taken to meet or exceed the prescribed levels.

4. Calculation of Wage Rate per Unit of Product (referred to as unit price):

To calculate wages paid based on products, first, the cost of labor producing each unit of product (unit price) must be calculated. A unit of product can be meters, cubic meters (m³), square meters (m²), kilograms, tons, or one piece... After obtaining the unit price, wages will be calculated based on the quantity of qualified products.

In the case of direct quotas assigned to individuals, the method of calculating the unit price is as follows:

a) If the quota is output-based, divide the time-based wage rate (daily or hourly) of the job grade by the output quota (per day or hour) to calculate the unit price:

Example: The output quota for a job is 40 units per day, and the daily wage rate for that job grade is 2,000 VND, so the unit price will be: 2,000 VND ÷ 40 = 50 VND.

b) If the quota is time-based, multiply the time-based wage rate (daily or hourly) of the job grade by the time quota of the unit product:

Unit Price = Time-Based Wage Rate × Time Quota.

Example: The time quota for a unit is 3 hours, the daily wage rate for that job grade is 1,800 VND, and the standard working hours per day are 8 hours, the unit price will be calculated as follows:

Hourly Wage Rate: 1,800 VND ÷ 8 = 225 VND

Unit Price: 225 VND × 3 = 675 VND

While calculating the unit price, it is necessary to note that regardless of the calculation method used, the principle "the same product produced under the same production conditions and with the same means shall have the same unit price" must be ensured. Therefore, the unit price must be calculated based on the job grade wage rate rather than the individual worker's wage rate. In cases where multiple workers of different grades (due to unreasonable labor organization or urgent needs requiring temporary reassignment) work on the same job, it is necessary to determine in advance which grade of worker is primarily needed for the job and use the wage rate of that grade to calculate the unit price.

If a worker's job grade wage rate is higher than the wage rate of the job they are reassigned to, they will receive a differential allowance between the two grades during the specified period, similar to workers receiving daily wages under the wage system when reassigned. Every effort must be made to rationally arrange and utilize workers. Such reassignments and differential allowances must be considered exceptional and temporary situations and should not lead to wasteful use of manpower due to guaranteed wage differentials.

Example: To produce a certain product, it requires a Grade 4 mechanic. In a temporary arrangement where a Grade 5 mechanic is reassigned to produce the same type of product, the unit price will be calculated based on the Grade 4 wage rate rather than the Grade 5 wage rate or the average wage rate of Grades 4 and 5. Additionally, the aforementioned Grade 5 mechanic will receive the difference between Grades 4 and 5 during the specified period.

Where regional allowances exist, these will be added to the job grade wage rate to calculate the unit price.

In the case of quotas for an entire team of workers (team, group, etc.) collectively completing a task, the unit price will be calculated as follows:

Example: A team has 4 workers, with daily wages of 2,400 VND for one worker, 2,000 VND for two workers, and 1,800 VND for one worker. The daily wage rate for the team is 8 units of product, so the unit price will be:

The distribution of wages according to products for each worker in the unit shall be selected based on specific circumstances at each place, but must avoid equal division, and should be based on salary grade, actual working time, productivity, and effort of each person to distribute reasonably according to the principle of earning more for doing more and earning less for doing less.

To determine the quota and unit price for a group of workers reasonably, it is necessary first to determine the number of people and the level of craftsmen arranged in the unit closely with production requirements, without excess personnel or capacity, or vice versa. For example, in a forging team producing a certain type of product, only one master craftsman of grade 5 and two apprentice craftsmen of grade 1 are needed; therefore, using one craftsman of grade 5, one of grade 4, and one of grade 2 would not be appropriate.

Quota and unit price are two closely related issues. When the quota changes, the unit price will also change, thereby affecting the income of workers. Therefore, when the quota becomes outdated, it needs to be raised, and staff must take concrete measures to guide and assist workers in mastering new techniques to quickly reach and exceed the quota. On the other hand, when setting a new unit price, attention should be paid to how the income of workers when reaching the old quota is slightly higher than before (except in cases where the quota is incorrect, which should not be set). In such cases, a bonus ratio can be added to the basic salary grade and then divided by the quota to calculate the unit price. The percentage increase and the types of work to which this applies will be proposed by the enterprise or construction site and decided by the competent ministry after consultation with the Ministry of Labor.

5. Monitoring, statistics, inspection, and acceptance of products during the implementation of the wage system based on production:

During the implementation of the wage system based on production, statistical inspection, and product acceptance have extremely important significance. Enterprises and construction sites must actively perform these tasks well to:

- Understand the implementation of the quota, grasp the quantity of products produced, identify those who fail to meet the quota, and find out the reasons why they cannot achieve the quota.

- Understand the quality assurance situation, the amount of raw materials consumed, the scrap rate, and find ways to eliminate or reduce the scrap rate and stipulate the wage for substandard products (defective goods).

- Identify advanced workers to summarize and disseminate their experiences widely within the unit and discover potential to raise production levels.

- Identify excessively high or low quotas that hinder the improvement of labor productivity and affect the reasonable wage relationship among workers.

- Identify shortcomings in quota setting and phenomena deviating from wage policy.

To carry out these tasks effectively, it is necessary to establish a system and improve the statistical, inspection, and product acceptance departments.

IV. IMPLEMENTATION OF LABOR REGIMES FOR WORKERS RECEIVING WAGES BASED ON PRODUCTION:

Paying wages based on production is merely one form of payment, so workers receiving wages based on production, like those receiving daily or monthly wages, must comply with the same labor regimes prescribed by the State for each type of worker (whether in the regular establishment or temporarily hired). Workers' rights regarding wages on holidays, allowances (excluding regional allowances already included in the unit price), social benefits (such as child allowances, sickness, maternity benefits, etc.), labor protection, and all other benefits of workers receiving wages based on production must be fully guaranteed, just as for workers receiving daily or monthly wages.

During actual production days, wages will be calculated based on the unit price and the quantity of products produced. In cases of job transfer, attending meetings, conferences, or being off work due to rain, storms, floods, lack of raw materials, machine breakdowns, or illness, wages will be paid according to the job transfer wage regime, study leave wage regime, and sick leave wage regime, similar to those for workers receiving daily wages.

On public holidays, if workers receiving wages based on production are required to work, in addition to the wages earned based on the products produced on that day, they will also receive a day's wage based on their salary grade.

If working on Sundays, wages will be based on the quantity of products produced.

For products that do not meet quality standards but are still usable (defective goods), the wage will be determined based on a lower unit price than the general unit price, depending on the specific circumstances of the enterprise or construction site.

Alongside the implementation of the wage system based on production, there must be plans to implement suitable wage systems, particularly focusing on key groups of workers whose nature of work does not provide sufficient conditions for implementing the wage system based on production.

The implementation of adjustments to gradually expand the wage system based on production, as decided by the enlarged Central Committee Meeting No. 13 and the Government, has significant importance for improving the wage system and motivating workers to strive to complete and exceed state plans. On the other hand, implementing the wage system based on production is a complex and challenging task.

It is recommended that ministries, city administrative committees, provincial committees, and district committees base themselves on this circular and the specific circumstances of each place to develop detailed plans to guide subordinate units under their jurisdiction to strictly lead and ensure the effective implementation of the wage system based on production. Labor authorities have the responsibility to closely monitor the grassroots level, assist local administrative committees in leading and guiding the implementation of the wage system based on production in their respective areas.

While implementing, particular emphasis should be placed on education and ideological leadership to ensure that cadres and workers thoroughly understand the principles and policies of wages in general and the wage system based on production specifically, recognizing that personal interests must be combined with common interests, thus striving to "produce more, produce faster, produce better, produce cheaper."

To ensure the proper implementation of the state salary plan, to ensure appropriate proportional relationships between production plans and wage increases, and between the income of workers on piece-rate and those not on piece-rate, it is required that the Ministries and Administrative Committees strictly direct and exchange unified opinions with the Ministry of Labor regarding the determination and review of piece-rate wages, standardization, and unit prices.

This Circular takes effect from the date of issuance in direct production and business units in the production sector: mines, factories, construction sites, and farms.

Based on this Circular, it is requested that the Ministries and Administrative Committees issue Circulars, Regulations, internal rules, etc., to specify and guide detailed implementation within their respective sectors and localities, but must ensure compliance with general principles and send a copy to the Ministry of Labor.