Decree 21/2024/ND-CP amend Decree 51/2016/ND-CP and Decree 52/2016/ND-CP salary, remuneration and bonus payment to managers of wholly state-own single-member limited liability companies

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Decree No. 21/2024/ND-CP dated February 23, 2024 of the Government amending, supplementing a number of articles of the Government’s Decree No. 51/2016/ND-CP dated June 13, 2016 on management of employees, salaries, bonuses of employees in single-member limited liability companies of which charter capital is wholly owned by the State and the Government’s Decree No. 52/2016/ND-CP dated June 13, 2016 on providing for salary, remuneration and bonus payment to managers of single-member limited liability companies of which charter capital is wholly owned by the State
Issuing body: GovernmentEffective date:
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Official number:21/2024/ND-CPSigner:Le Minh Khai
Type:DecreeExpiry date:Updating
Issuing date:23/02/2024Effect status:
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Fields:Enterprise , Labor - Salary

SUMMARY

Salary increase factor applicable to State companies with high planned profits

On February 23, 2024 issues the Government Decree No. 21/2024/ND-CP amending, supplementing a number of articles of the Government’s Decree No. 51/2016/ND-CP dated June 13, 2016 on management of employees, salaries, bonuses of employees in single-member limited liability companies of which charter capital is wholly owned by the State and the Government’s Decree No. 52/2016/ND-CP dated June 13, 2016 on providing for salary, remuneration and bonus payment to managers of single-member limited liability companies of which charter capital is wholly owned by the State.

1. If the company does not decrease in labor productivity and the planned profit is higher than the implementation of the preceding year, the salary increase factor must not exceed the increase factor as prescribed as follows:

- Group 1: Banking, finance (excluding securities trading market organizations, securities depositories), telecommunications        

+ Less than VND 500 billion: Salary increase factor 0.5;

+ From 500 to less than 1,500 billion VND: Salary increase factor 1.0;     

+ From 1,500 to less than 2,000 billion VND: Salary increase factor 1.5;

+ From 2,000 to less than 3,000 billion VND: Salary increase factor 2.0;

+ VND 3,000 billion or more: Salary increase factor 2.5.

- Group 2: Exploitation and processing of oil and gas, minerals, electricity, trade and services        

+ Less than VND 300 billion: Salary increase factor 0.5;

+ From 300 to less than 1,000 billion VND: Salary increase factor 1.0;

+ From 1,000 to less than 1,500 billion VND: Salary increase factor 1.5;

+ From 1,500 to less than 2,000 billion VND: Salary increase factor 2.0;

+ VND 2,000 billion or more: Salary increase factor 2.5.

- Group 3: Organization of the securities trading market, securities depository and other fields

+ Less than 200 billion VND: Salary increase factor 0.5;

+ From 200 to less than 700 billion VND: Salary increase factor 1.0;

+ From 700 to less than 1,000 billion VND: Salary increase factor 1.5;

+ From 1,000 to less than 1,500 billion VND: Salary increase factor 2.0;

+ VND 1,500 billion or more: Salary increase factor 2.5.

2. If the company is not profitable, the budgeted average pay rate must be lower than the basic pay rate, but not lower than 50% of the basic pay rate. In case of loss, the budgeted average pay rate is equal to 50% of the basic pay rate.

This Decree takes effect from April 10, 2024.

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THE GOVERNMENT

_______

No. 21/2024/ND-CP

THE SOCIALIST REPUBLIC OF VIETNAM

Independence - Freedom - Happiness
________________________

Hanoi, February 23, 2024

DECREE

Amending, supplementing a number of articles of the Government’s Decree No. 51/2016/ND-CP dated June 13, 2016 on management of employees, salaries, bonuses of employees in single-member limited liability companies of which charter capital is wholly owned by the State and the Government’s Decree No. 52/2016/ND-CP dated June 13, 2016 on providing for salary, remuneration and bonus payment to managers of single-member limited liability companies of which charter capital is wholly owned by the State

_________

 

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;

Pursuant to the Law on Enterprises dated June 17, 2020;

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

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

The Government promulgates the Decree amending, supplementing a number of articles of the Government’s Decree No. 51/2016/ND-CP dated June 13, 2016 on management of employees, salaries, bonuses of employees in single-member limited liability companies of which charter capital is wholly owned by the State and the Government’s Decree No. 52/2016/ND-CP dated June 13, 2016 on providing for salary, remuneration and bonus payment to managers of single-member limited liability companies of which charter capital is wholly owned by the State.

 

Article 1. Amending, supplementing a number of articles of the Government’s Decree No. 51/2016/ND-CP dated June 13, 2016 on management of employees, salaries, bonuses of employees in single-member limited liability companies of which charter capital is wholly owned by the State (hereby referred to as Decree No. 51/2016/ND-CP)

1. To amend Article 4 as follows:

“Article 4. Pay scale, payroll and allowances

1. Based on manufacturing organization, labor organization, every company shall release its pay scale, payroll and allowances as the basis for offering salaries and other benefits under labor laws.

2. Pay rates in pay scale, payroll, allowances shall be decided by the company, but it must ensure that the wage fund calculated according to the pay rates in the pay scale, payroll, allowance must not exceed the payroll budget of the employees as prescribed in this Decree.

3. Upon constructing, amending, supplementing pay scale, payroll, allowances, the company must consult with the grassroots-level employees’ representative organizations, organize dialogues in the workplace in accordance with regulations, report to the owner’s representative entity for opinions and publicize at the company before implementation.”

2. To amend, supplement Point a and Point b Clause 3, Article 5 as follows:

“a) The State shall adjust prices and production, business quotas (for products and services priced by the State or prescribe production, business quotas), corporate income tax incentives, increase or decrease of state capital, request companies to relocate or downsize production locations, etc. business, adjust mechanisms and policies that directly affect the company's labor productivity and profit targets.

b) The company shall participate in the implementation of political, security and defense tasks, ensuring social security, balancing supply and demand for the economy according to the decision of the Prime Minister; carry out the investment, receipt or transfer of the right to represent the owner of state capital under the directions of the Government or the Prime Minister; receive, buy, sell, freeze, extend and handle debts and assets, buy and sell products and services in accordance with law or at the request of competent state agencies; implement retroactive provisions according to the Government's regulations; increase depreciation for quick capital recovery in accordance with tax law; adjust operation policies according to the requirements of competent state agencies, Agreements, Treaties or regulations of international organizations to which Vietnam is a contracting party; implement schemes on restructuring, supplementation or divestment of investment capital in other enterprises; new investment, expansion of production, business; adjust or incur new provisions for financial and credit risks in accordance with law; provide products and services priced by the State and the price adjustment mechanism of which the price has not yet been adjusted to fully offset the actual reasonable production, business expenses when the price formation factors change according to the provisions of the Price Law; allocate expenses for unsuccessful oil and gas prospection, exploration and exploitation projects in accordance with the Government's regulations, determine corporate income tax under petroleum contracts for oil and gas prospection, exploration and exploitation companies in accordance with the tax law; the turnover of debt purchase and debt settlement not yet recorded in the turnover and profit of the debt trading company as prescribed by law; fluctuations in revenue from securities trading market organization and securities depository operations; difference in prize payment compared to the previous year for lottery companies; changes in the environment and conditions for mineral exploitation for mineral exploitation companies”.

Article 2. Amending, supplementing a number of articles of the Government’s Decree No. 52/2016/ND-CP dated June 13, 2016 on providing for salary, remuneration and bonus payment to managers of single-member limited liability companies of which charter capital is wholly owned by the State (herein referred to as Decree No. 52/2016/ND-CP)

1. The phrase "manager" in the name and the phrases "manager" or "company manager" in articles, clauses and Appendices of the Decree are replaced with the phrase "manager, supervisor".

2. To amend Article 3 as follows:

“Article 3. Classification of pay bands for full-time managers, Supervisors

1. Based on the organizational structure of management, the Board of Members or the Company President shall formulate and release the payroll and classify pay rate for full-time managers and supervisors as a basis for the implementation of the social insurance, health insurance, unemployment insurance and other regimes in accordance with the labor law.

2. The pay rates in the payroll shall be decided by the Board of Members or the Company President, but it must ensure the wage fund calculated according to the pay rates in the payroll not exceeding the payroll budget of the managers, supervisors as prescribed in this Decree.

3. Upon constructing, or amending, supplementing payroll of the managers, supervisors, Board of Members or the Company President, it is required to consult with the grassroots-level employees’ representative organizations, organize dialogues in the workplace in accordance with regulations, report to the owner’s representative entity for approvals and publicize at the company before implementation”.

3. To add Clause 8 to Article 4 as follows:

“8. In case the Supervisory Board of the company has only 01 Supervisor as prescribed in Article 103 of the Law on Enterprises, the Supervisor is entitled to the salary, remuneration and bonus of the title Head of the Supervisory Board”.

4. To amend, supplement Clause 2 Article 5 as follows:

“2. The budgeted average pay rate is determined on the basis of the basic pay rate according to the company rank specified in Appendices I and II promulgated together with this Decree and the salary increase factor compared to the basic pay rate according to the planned profit increase compared to the implementation of the preceding year as follows:

a) If the company does not decrease in labor productivity and the planned profit is higher than the implementation of the preceding year, the salary increase factor must not exceed the increase factor as prescribed as follows:

 

Table of salary increase factor

 

Salary increase factor

Profit level
by group of operation fields

0.5

1.0

1.5

2.0

2.5

1. Group 1: Banking, finance (excluding securities trading market organizations, securities depositories), telecommunications

Less than VND 500 billion

From 500 to less than 1,500 billion VND

From 1,500 to less than 2,000 billion VND

From 2,000 to less than 3,000 billion VND

VND 3,000 billion or more

2. Group 2: Exploitation and processing of oil and gas, minerals, electricity, trade and services

Less than VND 300 billion

From 300 to less than 1,000 billion VND

From 1,000 to less than 1,500 billion VND

From 1,500 to less than 2,000 billion VND

VND 2,000 billion or more

3. Group 3: Organization of the securities trading market, securities depository and other fields

Less than 200 billion VND

From 200 to less than 700 billion VND

From 700 to less than 1,000 billion VND

From 1,000 to less than 1,500 billion VND

VND 1,500 billion or more

 

In case the company has a planned profit that is many times higher than the lowest profit corresponding to the salary increase factor of 2.5 in the table of salary increase factor, playing a key role in the national economy, operating in the field where enterprises in the market are paying salaries to management workers higher than the equivalent title of the company, it is necessary to apply a higher than the salary increase factor as prescribed to encourage labor to manage, report to the representative entity when considering and deciding on the wage fund of managers and supervisors in accordance with the salary rate of the equivalent title in the same field of operation in the market, after consulting the Ministry of Labor, Invalids and Social Affairs to ensure the general balance.

b) If the planned profit is not higher than the actual profit of the preceding year, the salary increase factor must not exceed 70% of the salary increase factor corresponding to the profit level in the table of salary increase factor specified at Point a of this Clause multiplied by the ratio between the planned profit and the realized profit of the preceding year.

c) If the company is not profitable, the budgeted average pay rate must be lower than the basic pay rate, but not lower than 50% of the basic pay rate. In case of loss, the budgeted average pay rate is equal to 50% of the basic pay rate.

d) If the company reduces losses compared to the actual loss of the preceding year, the newly established or newly operate company, based on the level of loss reduction or the production, business plan to determine the salary, ensure the general correlation and report to the owner’s representative entity for consideration and decision.

dd) In cases where the planned profit is equal to or higher than the actual profit of the immediately preceding year, and after determining according to Points a and b of this Clause, the budgeted average pay rate is lower than the actual average salary of the immediately preceding year, the budgeted average pay rate shall be calculated by the actual average pay rate of the immediately preceding year.”.

5. To remove the content "or the non-profit company" in Clause 4, Article 5.

6. To add Clause 4a after Clause 4 Article 5 as follows: “4a. For a non-profit company, when determining the salary as prescribed in Clauses 2 and 3 of this Article, the profit target shall be replaced by the total revenue target minus total expenses”.

7. To amend Clause 6 Article 5 as follows:

“6. Upon determining the average pay rate, wage fund, remuneration budget of managers, Supervisors, the company shall exclude objective elements (if any) affecting labor productivity and planned profits compared to the actual profit of the preceding year. Objective elements are specified at Points a, b and c, Clause 3, Article 5 of the Government's Decree No. 51/2016/ND-CP dated June 13, 2016 on management of employees, salaries, bonuses of employees in single-member limited liability companies of which charter capital is wholly owned by the State”.

8. To remove the content “As for financial supervisors working at State-owned economic corporations, that difference shall be transferred to the Ministry of Finance for valuation and payment.” Clause 7, Article 4 and the content “accept, manage and pay salaries, remunerations and bonuses to financial supervisors remitted by State-owned economic corporations” in Point a Clause 5 Article 9.

9. To annul Clause 3 Article 10.

10. To amend, supplement a number of contents of Appendix I according to the Appendix promulgated together with this Decree.

Article 3. Effect

1. This Decree takes effect from April 10, 2024.

2. The regimes on payroll, salary payment, remuneration, bonus specified in Clause 2, Article 1, Clauses 3, 4, 6, 7 and 10, Article 2 of this Decree shall be implemented from January 1, 2024.

Article 4. Responsibilities of implementation organizations

1. The Ministry of Labor, Invalids and Social Affairs shall assume the prime responsibility for, and coordinate with relevant ministries in, guiding the implementation of the provisions of this Decree.

2. Non-State funds currently applying payroll regimes under Clause 6 Article 10 Decree No. 52/2016/ND-CP shall continue to apply maximum salary increase factor of no more than 1.0 times of basic pay rate to determine the salary of the managers, supervisors of the funds. 

3. With regard to Stock Exchanges, Vietnam Securities Depository and Clearing Corporation, upon objective elements specified at Point b, Clause 2 Article 1 of this Decree; Point b and Point c Cause 2 Article 6 of the Government’s Decree No. 59/2021/ND-CP dated June 18, 2021, providing a number of special contents in the mechanism for financial management and operational efficiency evaluation applicable to Vietnam Stock Exchange and Vietnam Securities Depository and Clearing Corporation, if the fluctuation in revenue increases more than 7% or decreases more than 3%, the portion of revenue that increases over 7% must be excluded (in case the revenue increases more than 7%) or the portion of revenue that decreases over 3% must be included (in case the revenue decreases more than 3%) in the revenue target as a basis for determining labor productivity and profit associated with the salaries of employees, managers and Supervisors.

4. For organizations specified in Clause 6, Article 10 of Decree No. 51/2016/ND-CP, Clause 6, Article 10 of Decree No. 52/2016/ND-CP and Vietnam Bank for Social Policies, the Ministry of Labor, Invalids and Social Affairs shall guide the management of labor, salaries, remuneration and bonuses according to the salary mechanism prescribed by the Government in Decree No. 51/2016/ND-CP, Decree No. 52/2016/ND-CP and this Decree, associated with labor productivity, operational efficiency and in accordance with the specific characteristics of these organizations, in which the Ministry of Labor, Invalids and Social Affairs is assigned to annually receive, review, inspect and supervise reports on labor plans and wage funds of employees; receive, consider and approve the wage, remuneration and bonus fund of managers and Supervisors of the Bank for Social Policies, after discussing with the Ministry of Finance and the State Bank of Vietnam.

5. Assigning the Ministry of Labor, Invalids and Social Affairs, based on the provisions of Clause 9, Article 2 of the Government's Decree No. 60/2022/ND-CP dated September 08, 2022, defining the functions, tasks, powers and organizational structure of the Vietnam Television and relevant laws, to guide the management of salaries for Vietnam Television according to the salary mechanism specified in Decree No. 51/2016/ND-CP and this Decree, associated with labor productivity and operational efficiency, in accordance with the specific characteristics of the Vietnam Television.

6. Ministers, Head of Ministry-level agencies, Head of Government-attached agencies, Chairpersons of the People’s Committees of centrally-run cities and provinces and relevant organizations, individuals shall be responsible for implementing this Decree./.

 

 

ON BEHALF OF THE GOVERNMENT

FOR THE PRIME MINISTER

THE DEPUTY PRIME MINISTER

 

 

Le Minh Khai

 

Appendix

AMENDING AND SUPPLEMENTING A NUMBER OF CONTENTS OF APPENDIX I ENCLOSED WITH THE GOVERNMENT’S DECREE NO. 52/2016/ND-CP DATED JUNE 13, 2016

(Enclosed to the Government’s Decree No. 21/2024/ND-CP dated February 23, 2024)

_________

1. To amend the name of Appendix I as follows:

“COMPANY RANKING”

2. To amend Point 1 as follows:

“1. Use of company ranking: The company ranking is used to determine the basic salary of full-time managers, Supervisors”.

3. To amend, supplement the content “the profit of at least VND 200 billion, remitting an amount of at least VND 200 billion to the State budget (capital, profit and State budget contribution standards which are measured on average within 3 years) and having at least 10 affiliated units, or hiring at least 10,000 employees in total working for parent companies and their affiliates” in Item, Point 2: “the profit (or total revenue minus total expenses for companies operating for non-profit objectives) of VND 200 billion or more, having 10 or more affiliated units (independent and dependent accounting) or having production and business organizations nationwide, fulfill the obligation to pay the state budget as prescribed. Indicators of capital, profit or total revenue minus total expenses for companies operating for non-profit objectives, shall be calculated on an average of 03 years”.

4. To amend, supplement the content “the profit of at least VND 100 billion, remitting an amount of at least VND 100 billion to the State budget or having at least 5 affiliated units, or hiring at least 7,000 employees in total working for parent companies and their affiliates” in Item c Point 2 : “profit (or total revenue minus total expenses for companies operating for non-profit objectives) of VND 100 billion or more, having 5 or more member units (independent and dependent accounting) or having production and business organizations nationwide, fully fulfill the obligation to pay the state budget as prescribed. Indicators of capital, profit or total revenue minus total expenses for companies operating for non-profit objectives, shall be calculated on an average of 03 years”.

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