Decree 87/2021/ND-CP extending the duration of implementation of Decree 20/2020/ND-CP, on the pilot management of labor, wages and bonuses of a number of state economic groups and corporations

DECREE

On extending the duration of implementation, and amending and supplementing a number of articles, of the Government’s Decree No. 20/2020/ND-CP of February 17, 2020, on the pilot management of labor, wages and bonuses of a number of state economic groups and corporations^[1]

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

Pursuant to the November 20, 2019 Labor Code;

Pursuant to the June 17, 2020 Law on Enterprises;

Pursuant to the November 26, 2014 Law on Management and Use of State Capital Invested in Production and Business at Enterprises;

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

The Government promulgates the Decree on extending the duration of implementation, and amending and supplementing a number of articles, of the Government’s Decree No. 20/2020/ND-CP of February 17, 2020, on the pilot management of labor, wages and bonuses of a number of state economic groups and corporations.

Article 1. To amend and supplement a number of articles of the Government’s Decree No. 20/2020/ND-CP of February 17, 2020, on the pilot management of labor, wages and bonuses of a number of state economic groups and corporations (below referred to as Decree No. 20/2020/ND-CP)

1. To amend the first paragraph of Article 1 as follows:

“This Decree prescribes the pilot management of labor, formulation of wage scales and wage tables; wages and bonuses of employees, Chief Executive Officers, Chief Operations Officers and Chief Accountants; wages, remuneration and bonuses of members of Members’ Councils or Boards of Directors, heads of Supervisory Boards, and supervisors of the following groups and corporations:”

2. To add the following Clause 5 to Article 8:

“5. Based on the paid wage fund, a company shall decide to use the whole wage fund to pay wages in the year, or make a deduction to set up a provision fund for addition to the wage fund of the subsequent year, which must not exceed 17% of the paid wage fund.”

3.  To annul the phrase “through December 31, 2020” in Clause 2, Article 20.

Article 2. Effect

1. This Decree takes effect on the date of its signing.

2. The provisions of this Decree shall be implemented from January 1, 2021, to the effective date of the Government’s new decree on management of labor, wages, remuneration and bonuses of state enterprises in accordance with Resolution No. 27-NQ/TW of May 21, 2018, of the Seventh Plenum of the XII^th Party Central Committee, on reform of salary policy for cadres, civil servants and public employees, armed forces and workers in enterprises.

3. In case a company’s labor productivity, profit or return on equity ratio is decreased mainly due to the direct impacts of objective factors, upon determination of the wage fund of employees and the Executive Board of the company based on the contractual unit price and levels of wage or remuneration of members of the Members’ Council or the Board of Directors, head of the Supervisory Board, and supervisors under Clauses 1 and 3, Article 8, Clause 2, Article 12, and Article 13, of Decree No. 20/2020/ND-CP, if the average wage level applied to the Executive Board and employees on the list of wage recipients is lower than 65% of their average wage level (including also bonus for occupational safety work, if any) in 2019; or the wage or remuneration of members of the Members’ Council or the Board of Directors, head of the Supervisory Boards, and supervisors is lower than 65% of the wage or remuneration of the holder of each respective title actually paid in 2019, the company shall report such to the owner-representing agency for the latter to decide on the average wage level to be applied to the Executive Board and employees which is up to 65% of their average wage level (including also bonus for occupational safety work, if any) in 2019; or decide on the wage or remuneration level to be applied to members of the Members’ Council or the Board of Directors, head of the Supervisory Boards and supervisors which is up to 65% of the wage or remuneration of the holder of each respective title actually paid in 2019.

4. When determining wages and remuneration according to Clause 3 of this Article, a company must complete its profit plan (after excluding objective factors) assigned by the owner-representing agency. The average wage level applied to employees and the Executive Board must not be lower than the wage level determined according to the wage scale and wage table formulated and issued by the company in accordance with Article 6 of Decree No. 20/2020/ND-CP.

5. Heads of Supervisory Boards and supervisors of companies shall continue to comply with the provisions on wages, remuneration and bonuses of Decree No. 20/2020/ND-CP but not the provisions on wages, remuneration and bonuses of Clause 2, Article 8 of the Government’s Decree No. 47/2021/ND-CP of April 1, 2021, detailing a number of articles of the Law on Enterprises, until the effective date of the Government’s new decree on management of labor, wages, remuneration and bonuses in state enterprises.

Article 3. Implementation responsibility

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

On behalf of the Government
For the Prime Minister
Deputy Prime Minister
LE MINH KHAI