Joint Circular No. 76/1999/TTLT/TC-TLD guiding the allocation and payment of trade union funds

JOINT CIRCULAR

GUIDELINES FOR THE WITHHOLDING AND PAYMENT OF UNION FEES

Pursuant to Article 16 of the Trade Union Law dated June 30, 1990;

Pursuant to Article 20 of Decree No. 133/HĐBT dated April 20, 1991 guiding the implementation of the Trade Union Law;

Pursuant to Articles 154 and 155 of the Labor Code dated June 23, 1994;

Pursuant to Clause 4 of Decision No. 53/1999/QĐ-TTg dated March 26, 1999 of the Prime Minister on certain measures to encourage foreign direct investment;

The Ministry of Finance and the Vietnam General Confederation of Labor Unions hereby provide guidelines for the withholding and payment of union fees as follows:

I-OBJECTS, AMOUNTS, AND BASIS FOR WITHHOLDING AND PAYMENT OF UNION FEES:

1- Objects subject to the withholding and payment of union fees

- Administrative state agencies; public service units; armed forces units; political organizations; political-social organizations; social organizations; occupational organizations.

- Enterprises belonging to various economic sectors (state-owned enterprises, private enterprises, limited liability companies, joint stock companies, and other types of enterprises as prescribed by law) where trade unions operate according to the Trade Union Law and the Charter of the Trade Union.

Foreign-invested enterprises are not subject to the payment of union fees as stipulated in this Circular but shall ensure and create favorable conditions for trade unions to operate in accordance with Articles 154 and 155 of the Labor Code.

2- Amounts and basis for the withholding and payment of union fees:

a) Administrative and public service units shall implement a withholding rate of 2% of the salary fund based on rank and grade and the allowances prescribed in Decree No. 25/CP dated May 23, 1993 and Decree No. 06/CP dated January 21, 1997 of the Government.

b) Enterprises shall implement a withholding rate of 2% of the salary fund, wages, and allowances payable to workers (including contractual workers).

c) The allowances included in the calculation for the withholding of union fees under points a and b above include: position allowance, responsibility allowance, regional allowance, attraction allowance, hardship allowance, special allowance, hazardous and dangerous work allowance, mobility allowance, national defense and security service allowance, seniority allowance.

d) The allowances excluded from the calculation for the withholding of union fees under points a and b above include: preferential allowance for teachers directly teaching in state-run schools according to Decision No. 973/1997/QĐ-TTg dated November 17, 1997 of the Prime Minister, surgery allowance and 24-hour on-call allowance in the health sector according to Decision No. 974/TTg dated December 5, 1995 of the Prime Minister, night shift allowance, overtime allowance.

II-METHODS, TIME PERIODS FOR WITHHOLDING AND PAYMENT, AND ACCOUNTING OF UNION FEES

1- For agencies, units, and organizations receiving salaries from the state budget:

a) The Ministry of Finance shall withhold 2% of the salary fund of central-level agencies and organizations receiving salaries from the state budget and transfer it to the Vietnam General Confederation of Labor Unions.

b) Local financial agencies shall withhold 2% of the salary fund and allowances of agencies and organizations receiving salaries from the local budget and transfer it to the corresponding level labor union agency.

c) The withholding and transfer of union fees by agencies and organizations receiving salaries from the state budget must be accounted for in the state budget in accordance with the provisions of the State Budget Law and current guiding documents.

2- For agencies, organizations not receiving salaries from the state budget and enterprises where trade unions exist (excluding foreign-invested enterprises):

Heads of agencies, organizations; directors of enterprises have the responsibility to withhold 2% of the salary fund, wages, and allowances and transfer them to the grassroots trade union organization of their own agency, organization, or enterprise for management, use, and transfer to higher-level labor union agencies as prescribed by the Vietnam General Confederation of Labor Unions.

In cases where necessary, labor union agencies may negotiate with tax authorities to collect union fees on behalf of the agency.

For production and business units, the amount withheld at 2% for union fees shall be accounted for in cost or circulation expenses.

3- Time period for withholding and payment of union fees

- For agencies and organizations receiving salaries from the state budget, the time for withholding and payment shall be carried out concurrently with the issuance of the annual budget allocation for the agency or organization.

- For agencies and organizations not receiving salaries from the state budget and enterprises responsible for paying union fees, they shall pay once every quarter in the first month of each quarter.

- If the labor union agency entrusts the tax authority to collect on its behalf, the time for withholding and payment shall coincide with the time for tax collection and payment.

III-DUTIES OF FINANCIAL AGENCIES AND LABOR UNION ORGANIZATIONS

1- Financial agencies have the responsibility to fully and promptly withhold union fees from units under their management and transfer them to labor union agencies in accordance with this Circular.

2- National Treasury units have the responsibility to facilitate the opening of accounts for labor union funds for management by labor union agencies at all levels. The balance remaining in the account at the end of the year can be carried over to the next year without the need for year-end transfer procedures like other state budget funds.

3- Labor unions at all levels have the responsibility to urge the full collection of union fees and manage and use the union fee fund in accordance with the regulations of the Vietnam General Confederation of Labor Unions and the current state financial system.

4- The Vietnam General Confederation of Labor Unions has the responsibility to guide the specific distribution, use, and reallocation of union fees within the labor union system.

5- The Ministry of Finance has the responsibility to coordinate with the Vietnam General Confederation of Labor Unions to monitor and inspect the management and use of union fee funds in accordance with the current financial management system.

IV- IMPLEMENTATION

This Circular takes effect from July 1, 1999 and replaces Circular No. 103/TT-LB dated December 2, 1994 issued jointly by the Ministry of Finance and the Vietnam General Confederation of Labor Unions on the withholding and payment of union fees.

During the implementation process, if difficulties or obstacles arise, please report to the Ministry of Finance and the Vietnam General Confederation of Labor Unions for guidance on resolution./.