Decree No. 49/2013/ND-CP guiding the Labor Code on wages

DECREE

Detailed Implementation of Certain Provisions of the Labor Code on Wages

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

Based on the Labor Code dated June 18, 2012;

Decree No. 07/2021/NĐ-CP

The Government promulgates this Decree to provide detailed implementation of certain provisions of the Labor Code on wages,

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Decree stipulates the functions, tasks, and organizational structure of the National Wage Council as provided for in Clause 2, Article 92; principles for establishing wage scales and labor norms as provided for in Clause 1, Article 93 of the Labor Code.

Article 2. Applicability

1. Members of the National Wage Council as provided for in Clause 1, Article 92 of the Labour Code.

2. Workers employed under labor contracts as provided for in Clause 1, Article 3 of the Labour Code.

3. Employers as provided for in Clause 2, Article 3 of the Labour Code (hereinafter referred to collectively as enterprises).

4. Agencies, organizations, and individuals related to the regulations and implementation of the functions, tasks, and organizational structure of the National Wage Council and the establishment of wage scales and labor norms as prescribed in this Decree.

Chapter II

NATIONAL WAGE COUNCIL

Article 3. Functions of the National Wage Council

1. The National Wage Council performs the function of advising the Government on adjusting and announcing the minimum regional wage levels.

2. The Prime Minister decides to establish the National Wage Council.

Article 4. Tasks of the National Wage Council

1. Analyze economic and social conditions, living standards of the population to determine and forecast the minimum living needs of workers and their families; assess the implementation of regional minimum wages, market wage levels, and enterprises' ability to pay to develop and recommend annual and periodical minimum regional wage schemes to the Government.

2. Study and recommend to the Government the hourly minimum wage applicable to certain irregular jobs or part-time work.

3. Organize reviews and evaluations of the division of regions applying minimum regional wage levels to recommend to the Government adjustments and supplements to the division of regions applying minimum regional wage levels.

4. Survey practices, study foreign experiences to enhance advisory capacity and effectiveness on minimum wages.

5. Study and advise on other issues related to wage policy at the request of the Government and the Prime Minister.

Article 5. Organizational Structure of the National Wage Council

1. The National Wage Council shall consist of fifteen members, including: five members representing the Ministry of Labor, War Invalids and Social Affairs, five members representing the Vietnam General Confederation of Labor, and five members representing central-level employer organizations, among which:

a) The Chairman of the Council is a Deputy Minister of the Ministry of Labor, War Invalids and Social Affairs;

b) Three Vice Chairpersons, including: one Vice Chairman from the Vietnam General Confederation of Labor, one Vice Chairman from the Vietnam Chamber of Commerce and Industry, and one Vice Chairman from the Vietnam Federation of Trade Unions;

c) Council members, including: four members representing the Ministry of Labor, War Invalids and Social Affairs; four members representing the Vietnam General Confederation of Labor; one member representing the Vietnam Association of Small and Medium Enterprises; two members representing two central-level industry associations with significant labor usage.

2. The Prime Minister appoints the Chairman and Vice Chairmen of the National Wage Council upon the proposal of the Minister of Labor, War Invalids and Social Affairs, and authorizes the Minister of Labor, War Invalids and Social Affairs to appoint Council members.

3. The Chairman, Vice Chairmen, and Council members of the National Wage Council must be specialists with experience in the field of labor and wages; they must have the qualifications and capabilities to consider and propose recommendations required by the agencies they represent and participate in the activities of the National Wage Council. The Chairman, Vice Chairmen, and Council members serve concurrently, with a term of five years.

4. The National Wage Council has a technical department and a permanent office to assist the Council in researching, surveying, compiling, and developing regional minimum wage schemes, dividing regions for applying minimum wages for discussion at the Council meetings, and performing administrative tasks of the Council.

5. The operating funds of the National Wage Council are guaranteed by the state budget, allocated in the annual budget of the Ministry of Labor, War Invalids and Social Affairs, and other legitimate sources as prescribed by law.

Article 6. Rules of Operation of the National Wage Council

1. The Chairman of the National Wage Council shall stipulate the rules of operation for the National Wage Council, technical units, and permanent units.

2. The Chairman of the National Wage Council may invite experts, scientists, researchers from ministries, sectors, research institutes, universities to consult or participate in Council meetings.

Chapter III

PRINCIPLES FOR BUILDING WAGE SCALES AND LABOR STANDARDS

Article 7. Principles for Building Wage Scales

1. Based on production organization, labor organization, enterprises establish and decide on wage scales for managerial staff, technical and professional staff, and direct production, business, and service workers.

2. The multiplier of the wage scale is the difference coefficient between the highest wage level for work or position requiring the highest technical skill and the lowest wage level for work or position requiring the lowest technical skill. The number of steps in the wage scale depends on the complexity of management, the level of work or position required. The gap between two consecutive wage levels must ensure encouragement for workers to improve their professional skills, accumulate experience, and develop talent but not less than 5%.

3. The lowest wage level (starting point) for work or position in the wage scale is determined by the company based on the complexity of the work or position corresponding to the level of expertise, skills, responsibility, and experience required to perform the work or position, including:

a) The lowest wage level for the simplest work or position under normal working conditions shall not be lower than the minimum regional wage set by the Government;

b) The lowest wage level for work or position requiring trained or skilled labor (including labor trained by the enterprise itself) must be at least 7% higher than the regional minimum wage set by the Government;

c) The wage level for work or position under harsh, toxic, or dangerous working conditions must be at least 5% higher; for work or position under extremely harsh, toxic, or dangerous working conditions, it must be at least 7% higher than the wage level for work or position with equivalent complexity performed under normal working conditions.

4. When establishing and implementing wage scales, equality must be ensured without discrimination based on gender, ethnicity, skin color, social class, marital status, belief, religion, HIV status, disability, or reasons for union formation, membership, and activities for workers, while also establishing criteria for grading wages and conditions for wage advancement.

5. Wage scales must be periodically reviewed to amend and supplement them to suit actual conditions regarding technological innovation, production organization, labor organization, wage levels in the labor market, and compliance with labor laws.

6. When establishing or amending, supplementing the wage scale or wage table, the enterprise must consult the opinions of the representative organization of the labor collective at the enterprise and publicly announce at the workplace of the workers before implementation, while sending to the state management agency on labor at the district where the production facility of the enterprise is located. For a single-member limited liability company owned by the State when establishing or amending, supplementing the wage scale or wage table, it must report to the owner for comments before implementation; for the parent company of a state economic group, the parent company of a special-class corporation, they must also send to the Ministry of Labor, Invalids and Social Affairs for monitoring and supervision.

1. Labor norms shall be implemented for each step of work, each process, and the entire production process of products and services based on scientific labor organization and reasonable production organization.

2. The wage level is established based on the rank of the job or position, consistent with the rank, educational level of the worker, technological process, technical standards of machinery and equipment, and ensuring labor standards.

3. The level of labor must be an advanced average level that ensures the majority of workers can achieve it without extending the standard working time of the enterprise as prescribed by law.

4. A new wage level must be piloted before being officially issued. The enterprise must notify the workers at least 15 days before piloting. The trial period varies according to the nature of the work, but shall not exceed three months and must evaluate the implementation of the wage level.

In cases where during the standard working period, the actual wage level implemented based on output is lower than 5% or higher than 10% compared to the assigned wage level, or the actual wage level implemented based on time is higher than 5% or lower than 10% compared to the assigned wage level, the enterprise must adjust the wage level.

5. The wage level must be periodically reviewed and evaluated for amendment, supplementation, and adjustment to ensure appropriateness. When establishing or amending, supplementing, and adjusting the wage level, the enterprise must consult the opinions of the representative organization of the labor collective at the enterprise and publicly announce at the workplace of the workers before implementation, while sending to the state management agency on labor at the district where the production facility of the enterprise is located.

Chapter IV

IMPLEMENTING PROVISIONS

Article 9. Effective Date

1. This Decree takes effect from July 1, 2013. The provisions of this Decree shall be applied from May 1, 2013.

2. Decree No. 114/2002/ND-CP dated December 31, 2002 of the Government detailing and guiding the implementation of certain provisions of the Labor Code on wages; Decree No. 205/2004/ND-CP dated December 14, 2004 of the Government on the wage scale system, wage table, and wage allowance system in state-owned companies cease to be effective from the date this Decree takes effect.

Article 10. Responsibility for Implementation

1. Responsibilities for organizing the implementation of regulations on the functions, tasks, and organizational structure of the National Wage Council:

a) Heads of agencies and organizations specified in Clause 1, Article 5 of this Decree appoint representatives to participate in the National Wage Council and submit lists for the Ministry of Labor, Invalids and Social Affairs to compile;

b) The Chairman of the Vietnam Chamber of Commerce and Industry selects and proposes the heads of two central industry associations employing many workers to appoint representatives to participate in the National Wage Council;

c) The Minister of Labor, Invalids and Social Affairs compiles and proposes the Prime Minister to appoint the Chairman and Vice Chairmen of the National Wage Council; decides on the appointment of members of the National Wage Council.

2. Responsibilities for organizing the implementation of the establishment of wage scales and labor norms.

b) The state management agency on labor at the district where the production and business facilities of the enterprise are located receives the wage scale, wage table, and labor norms of the enterprise in accordance with Clause 2 Article 93 of the Labor Code; Clause 6 Article 7 and Clause 5 Article 8 of this Decree to review and inspect. In case of discovering contents that do not comply with regulations, it must issue a document requesting the enterprise to amend, adjust, and supplement in accordance with the relevant labor laws;

c) The People's Committee of provinces and centrally-administered cities directs the Department of Labor, Invalids and Social Affairs to cooperate with the Trade Union and related agencies to organize propaganda, guidance, inspection, and supervision of the establishment of the wage scale, wage table, and labor norms for enterprises within their jurisdiction in accordance with this Decree;

d) Agencies and organizations entrusted with the rights and obligations of the owner of a single-member limited liability company owned by the State accept, inspect, and supervise the establishment of the wage scale and wage table for such companies owned by themselves;

đ) The Ministry of Labor, Invalids and Social Affairs guides single-member limited liability companies owned by the State, organizations, units of the State, joint-stock companies, and limited liability companies with two or more shareholders converted from state-owned companies and single-member limited liability companies owned by the State currently classified according to the wage scale and wage table issued together with Decree No. 205/2004/ND-CP dated December 14, 2004 of the Government to implement the establishment of the wage scale, wage table, and wage allowances in accordance with this Decree, ensuring reasonable wage relationships among various types of workers in the company and industries; transfer the classification of wages for workers from the wage scale and wage table issued by the Government together with Decree No. 205/2004/ND-CP dated December 14, 2004 to the wage scale and wage table issued by the company.

3. The Minister, Head of a ministerial-level agency, Head of an agency under the Government, Chairman of the People's Committee of provinces and centrally-administered cities, and related agencies, organizations, enterprises, and individuals are responsible for implementing this Decree./.