Decree No. 49/2013/ND-CP dated May 14, 2013 of the Government detailing a number of articles of the Labor Code regarding wage

THE GOVERNMENT

Decree No. 49/2013/ND-CP of May 14, 2013, detailing a number of articles of the Labor Code regarding wage

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

Pursuant to the June 18, 2012 Labor Code;

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

The Government promulgates this Decree to detail a number of articles of the Labor Code regarding wage.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

This Decree defines the functions, tasks and organizational structure of the National Wage Council prescribed in Clause 2, Article 92; and provides principles of formulation of wage scales, wage tables and labor norms prescribed in Clause 1, Article 93 of the Labor Code.

Article 2. Subjects of application

1. Members of the National Wage Council prescribed in Clause 1, Article 92 of the Labor Code.

2. Employees working under labor contracts prescribed in Clause 1, Article 3 of the Labor Code.

3. Employers prescribed in Clause 2, Article 3 of the Labor Code (below referred to as enterprises).

4. Agencies, organizations and individuals involved in the definition and realization of the National Wage Council’s functions, tasks and organizational structure and the formulation of wage scales, wage tables and labor norms as prescribed in this Decree.

Chapter II

THE NATIONAL WAGE COUNCIL

Article 3. Functions of the National Wage Council

1. The National Wage Council advises the Government on the adjustment and announcement of region-based minimum wage levels.

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

Article 4. Tasks of the National Wage Council

1. To analyze the socio-economic situation and people’s living standards to determine and forecast the minimum living needs of employees and their families; to evaluate the implementation of region-based minimum wage levels, wage levels on the labor market and enterprises’ payment capacity in order to formulate and propose to the Government annual and periodical plans on region-based minimum wages.

2. To study and propose to the Government hour-based minimum wage levels applicable to a number of irregular occupations or jobs or part-time jobs.

3. To review and evaluate the division of localities in which region-based minimum wage levels apply before proposing them to the Government for adjustment or addition.

4. To survey the reality and study foreign experiences to improve the capacity and efficiency of advices and recommendations on minimum wages.

5. To study and advise on other matters related to wage policies at the request of the Government or the Prime Minister.

Article 5. Organizational structure of the National Wage Council

1. The National Wage Council is composed of 15 members, including 5 representatives of the Ministry of Labor, War Invalids and Social Affairs, 5 representatives of the Vietnam General Confederation of Labor and 5 representatives of central-level organizations representing employers, in which:

a/ The chairperson of the Council is a Deputy Minister of Labor, War Invalids and Social Affairs;

b/ Three vice chairpersons include a vice chairperson of the Vietnam General Confederation of Labor, a vice chairperson of the Vietnam Chamber of Commerce and Industry and a vice chairperson of the Vietnam Cooperative Alliance;

c/ Members of the Council include four representatives of the Ministry of Labor, War Invalids and Social Affairs; four representatives of the Vietnam General Confederation of Labor; one representative of the Vietnam Association of Small- and Medium-Sized Enterprises; and two representatives of two central-level trade associations employing large numbers of employees.

2. The Prime Minister shall appoint the chairperson and vice chairpersons of the National Wage Council at the request of the Minister of Labor, War Invalids and Social Affairs and authorize the latter to appoint other members.

3. The chairperson, vice chairpersons and members of the National Wage Council are those specialized and experienced in labor and wage; having qualifications and capacity to consider and make proposals and requests of agencies which they represent and have conditions to participate in the National Wage Council’s activities. The chairperson, vice chairpersons and members of the National Wage Council work on a part-time basis for a term of office of five years.

4. The National Wage Council has a technical division and a standing body that assist it in studying, surveying, summarizing and formulating plans on region-based minimum wages and sub-regions applying minimum wages for discussion at the Council and perform the Council’s administrative work.

5. The National Wage Council’s operating funds are ensured by the state budget and incorporated in annual budget estimates of the Ministry of Labor, War Invalids and Social Affairs and other lawful sources in accordance with law.

Article 6. Working regulation of the National Wage Council

1. The chairperson of the National Wage Council sets out the working regulations of the Council and its technical division and standing body.

2. The chairperson of National Wage Council may invite experts, scientists and researchers of ministries, sectors, research institutes and universities for advices or to attend the Council’s meetings.

Chapter III

PRINCIPLES OF FORMULATION OF WAGE SCALES, WAGE TABLES AND LABOR NORMS

Article 7. Principles of formulation of wage scales and tables

1. Based on its production and labor organization, an enterprise may formulate and decide on its wage scale and table for managerial, technical or professional employees and workers directly involved in production, business and service activities.

2. Multiples of wage scales is the coefficient of difference between the wage level of a job or title subject to the highest technical qualification requirement and the wage level of a job or title subject to the lowest one. The grades of the wage scale and table depend on the complexity of management, grades of jobs or required titles. The gap between two consecutive wage grades must encourage employees to improve their technical and professional qualifications, accumulate experiences and promote their talents but must be at least 5%.

3. Companies shall determine the lowest wage level (starting level) of a job or title in the wage scale and table on the basis of the complexity of job or title corresponding to the qualifications, skills, responsibilities and experiences in order to perform such job or title, of which:

a/ The lowest wage level of the simplest job or title in the normal working conditions must not be lower than region-based wage levels prescribed by the Government;

b/ The lowest wage level of a job or title requiring trained employees (including those trained by enterprises) must be at least 7% higher than region-based wage levels prescribed by the Government;

c/ The wage level of a job or title to be performed in heavy, hazardous and dangerous working conditions must be at least 5% higher; a job or title in exceptionally heavy, hazardous and dangerous working conditions must be at least 7% higher than the wage level of a job or title with a similar complexity but in the normal labor conditions.

4. The formulation and application of wage scales and tables must ensure the equality and non-discrimination of gender, ethnicity, skin color, social status, marital status, belief, religion, HIV infection, disability or discrimination for the trade union establishment, admission and operation of employees. At the same time, the elaboration of standards for wage arrangement and grade raise is required.

5. Wage scales and tables must be periodically reviewed for revision in conformity with actual technological renewal, production and labor organization and wage levels on the labor market and in accordance with the labor law.

6. Upon the formulation or revision of wage scales and tables, enterprises shall consult organizations representing labor collectives, publicize them at workplaces of employees before implementation, and concurrently send them to labor state management agencies in districts where their production establishments are located. When formulating or revising wage scales or tables, state-owned single-member limited liability companies shall report such to their owners for opinions before implementation; and parent companies of state economic groups or special-grade corporations shall send such reports to the Ministry of Labor, War Invalids and Social Affairs for monitoring and supervision.

Article 8. Principles of elaboration of labor norms

1. Labor norms are applied for each step of a job, each stage or the entire process of production of products or provision of services on the basis of scientific labor organization and rational production organization.

2. Labor level is elaborated on the basis of grades of jobs or titles, suitable to grades and trained qualifications of employees, technological process and technical standards of machines and equipment, and up to all labor standards.

3. Labor level must be an advanced average one, which can be attained by the majority of employees without prolonging enterprises’ standard working time in accordance with law.

4. A new labor level must be experimentally applied before being officially promulgated. Enterprises shall inform it to their employees at least 15 days before experimental application. The duration of experimental application depends on the nature of jobs, but must not exceed 3 months; the evaluation of the labor level implementation is required.

During the standard working time, if the productivity-based actual level is 5% lower or 10% higher than the assigned one, or the time-based actual level is 5% higher or 10% lower than the assigned one, enterprises must revise the labor level.

5. The labor level must be periodically reviewed and evaluated for revision and adjustment. When elaborating, revising or adjusting the labor level, enterprises shall consult organizations representing labor collectives, publicize them at workplaces of employees before implementation, and concurrently send them to labor state management agencies in districts where their production establishments are located.

Chapter IV

IMPLEMENTATION PROVISIONS

Article 9. Effect

1. This Decree takes effect on July 1, 2013. This Decree’s provisions apply from May 1, 2013.

2. The Government’s Decree No. 114/2002/ND-CP of December 31, 2002, detailing and guiding a number of articles of the Labor Code regarding wage; and Decree No. 205/2004/ND-CP of December 14, 2004, providing the system of wage scales, wage tables and wage-based allowance regime in state companies, cease to be effective on the effective date of this Decree.

Article 10. Implementation organization responsibilities

1. Responsibility for organization of implementation of the provisions on functions, tasks and organizational structure of the National Wage Council:

a/ Heads of agencies and organizations prescribed in Clause 1, Article 5 of this Decree shall appoint their representatives to join the National Wage Council and send lists of such representatives to the Ministry of Labor, War Invalids and Social Affairs for summarization;

b/ The chairperson of the Vietnam Chamber of Commerce and Industry shall select and request the heads of two central-level trade associations employing large numbers of employees to appoint their representatives to join the National Wage Council;

c/ The Minister of Labor, War Invalids and Social Affairs shall summarize and propose to the Prime Minister for appointment the chairperson and vice chairpersons of the National Wage Council; and decide on the appointment of members of the National Wage Council.

2. Responsibility for organization of formulation of wage scales, wage tables and labor norms

a/ Enterprises shall formulate or review their revisions of their wage scales, wage tables and labor norms and send them to labor state management agencies in districts where their production and business establishments are located for supervision and inspection as prescribed in this Decree. An enterprise that has many units and branches operating in various localities shall send its decision on wage scales, wage tables and labor norms to labor state management agencies in districts where its units and branches are located for monitoring and inspection;

b/ Labor state management agencies in districts where enterprises’ production and business establishments are located shall receive such enterprises’ wage scales, wage tables and labor norms as prescribed in Clause 2, Article 93 of the Labor Code; and Clause 6, Article 7 and Clause 5, Article 8 of this Decree for review and examination. If detecting any content inconsistent with regulations, they shall request in writing enterprises to make revision or adjustment in accordance with the labor law;

c/ Provincial-level People’s Committees shall direct local Labor, War Invalids and Social Affairs Departments in coordinating with the Vietnam Confederations of Labor and relevant agencies in organizing the propagation, guidance, inspection and examination of formulation of wage scales, wage tables and labor norms for enterprises in their localities in accordance with this Decree;

d/ Agencies and organizations assigned to implement the owners’ rights and obligations to state-owned single-member limited liability companies shall receive, examine and supervise the formulation of wage scales and wage tables of companies which they own;

dd/ The Ministry of Labor, War Invalids and Social Affairs shall guide state-owned single-member limited liability companies, state organizations and units, joint-stock companies and limited liability companies with two or more members transformed from state companies or state-owned single-member limited liability companies that are arranging their wages in accordance with the wage scales and wage tables promulgated together with the Government’s Decree No. 205/2004/ND-CP of December 14, 2004, in the formulation of wage scales, tables and allowances in accordance with this Decree, ensuring the rational wage relations among their types of employees and professions, and the wage transfer for employees from the wage scales and tables promulgated together with the Government’s Decree No. 205/2004/ND-CP of December 14, 2004, to wage scales and tables promulgated by these companies.

3. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees and related agencies, organizations, enterprises and individuals shall implement this Decree.-

On behalf of the Government
Prime Minister
NGUYEN TAN DUNG