Decree 38/2022/ND-CP prescribing region-based minimum wage levels applicable to employees working under labor contracts

DECREE

Prescribing region-based minimum wage levels applicable to employees working under labor contracts

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Pursuant to the Law on Organization of the Government dated June 19, 2015; the Law Amending and Supplementing a Number of Articles of the Law on Organization of the Government and the Law on Organization of Local Administration dated November 22, 2019;

Pursuant to the Labor Code dated November 20, 2019;

At the proposal of the Minister of Labor, Invalids and Social Affairs;

The Government hereby promulgates the Decree prescribing minimum wage levels applicable to employees working under labor contracts.

Article 1. Scope of regulation

This Decree prescribes the monthly and hourly minimum wage levels applicable to employees working under labor contracts.

Article 2. Subjects of application

1. Employees working under labor contracts as defined in the Labor Code.

2. Employers as defined in the Labor Code, including:

a) Enterprises as prescribed by the Law on Enterprises.

b) Agencies, organizations, cooperatives, households and individuals that hire or employ employees under agreements.

3. Other agencies, organizations and individuals involved in the implementation of minimum wage levels specified in this Decree.

Article 3. Minimum wage levels

1. Monthly and hourly region-based minimum wage levels applicable to employees working for employers are prescribed as follows:

2. The list of localities in regions I, II, III and IV are specified in the Appendix to this Decree.

3. The application of localities shall be determined based on the employer’s place of operation as follows:

a) An employer shall apply the minimum wage level prescribed for the locality where it operates.

b) In case an employer has units or branches in localities for which different minimum wage levels are prescribed, each unit or branch shall apply the minimum wage level prescribed for the locality where it operates.

c) For employers operating in industrial parks or export processing zones in localities for which different minimum wage levels are prescribed, the highest minimum wage level shall be applied.

d) For an employer operating in the locality which is renamed or divided, the minimum wage level prescribed for such locality before it is renamed or divided shall temporarily be applied pending the Government’s issuance of new regulations.

dd) For an employer operating in a locality newly established from one or more than one locality for which different minimum wage levels are prescribed, the highest minimum wage level shall be applied.

e) For an employer operating in a provincial city newly established from one or more than one locality of region IV, the minimum wage level prescribed for other provincial cities mentioned in Section 3 of the Appendix to this Decree shall be applied.

Article 4. Application of minimum wage levels

1. The monthly minimum wage levels are the lowest ones which serve as a basis for employers and employees to reach agreement on and pay wages, in case of paying wages on a monthly basis, provided that the level of wage to be paid (accordingly job or title) to an employee who works sufficient normal working time in a month and fulfills labor norms or work as agreed must not be lower than the monthly minimum wage levels.

2. The hourly minimum wage levels are the lowest ones which serve as a basis for employers and employees to reach agreement on and pay wages, in case of paying wages on an hourly basis, provided that the level of wage to be paid (accordingly job or title) to an employee who fulfills labor norms or work as agreed in an hour, must not be lower than the hourly minimum wage levels.

3. For workers who are paid on a daily or weekly basis, or who are paid based on piece work or products turned out, their salary, when converted into the monthly or hourly rate, must not be lower than the monthly or hourly minimum wage level. The salary that is converted into monthly or hourly rate or based on the normal working time as decided by the employers in accordance with the labor law shall be as follows:

a) The salary converted into the monthly rate shall be equal to the weekly wage multiplied by 52 weeks, divided by 12 months; or the daily wage multiplied by the number of normal working days in a month; or the salary paid based on piece work or products turned out in the normal working hours of the month.

b) The salary converted into hourly rate shall be equal to the weekly or daily wage, divided by the number of normal working hours in a week or a day; or the salary that is paid based on piece work or products turned out divided by the number of working hours in the normal working time for the production or piece work implementation.

Article 5. Effect and implementation responsibility

1. This Decree takes effect on July 01, 2022.

2. The Government’s Decree No. 90/2019/ND-CP dated November 15, 2019, prescribing region-based minimum wage levels applicable to employees working under labor contracts, ceases to be effective on the effective date of this Decree.

3. Employers shall be responsible for organizing to review agreements in their labor contracts, collective labor agreements and regulations to adjust and supplement accordingly. It is not allowed to neither abolish nor cut wage-based allowances payable to employees who work overtime, at night, or benefits in kind and other entitlements in accordance with the labor law. Agreed contents or commitments in labor contracts, labor agreements or other legal agreements, that bring more benefits for employees compared to provisions provided in this Decree, shall continue to be implemented, unless otherwise agreed by both parties.

Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of People’s Committees of provinces and centrally-run cities and employers shall implement this Decree./.