Decree No. 38/2022/ND-CP: 4 changes in region-based minimum wage from July 2022

This is a great expectation over two years, the Government issues Decree No. 38/2022/ND-CP on June 12, 2022 with many changes relating to the region-based minimum wage the next time.

1. The region-based minimum wage increases by 6% from July 01, 2022

Takes effect on July 01, 2022, the Decree No. 38/2022/ND-CP has adjusted the region-based minimum wage levels with an increase of 6% compared with the Decree No. 90/2019/ND-CP. In particulars:

Unit: VND/month

Region	Region-based minimum wage levels in Decree No. 90/2019/ND-CP (Applied to June 30, 2022)	Region-based minimum wage levels in Decree No. 38/2022/ND-CP (Applied from 7/1/2022)	Increase by
Region I	4,420,000	4,680,000	260,000
Region II	3,920,000	4,160,000	240,000
Region III	3,430,000	3,630,000	210,000
Region IV	3,070,000	3,250,000	180,000

When the new region-based minimum wage is applied, employees shall have many more benefits such as an Increase in wage for the employees receiving the minimum wage, an increase in the wages in case of work suspension, an increase in the maximum unemployment benefits...



2. Hourly minimum wage is formally prescribed for the first time

Previously, Labor Code 2012 and Labor Code 2019 have mentioned the definition of minimum wage levels on a monthly and hourly basis, however, only monthly minimum wage levels are prescribed.

Decree No. 38/2022/ND-CP is the first Decree that prescribes the hourly minimum wage level. Accordingly, the hourly minimum wage level is the minimum basis for agreement and payment for employees in the form of hourly wage payment, ensure the job- or title-based wage amount within one hour and finish the agree on works but must not be lower than the hourly minimum wage level.

The hourly minimum wage level is applied from July 01, 2022, as follows:

Region	Hourly minimum wage levels
Region I	VND 22,500/hour
Region II	VND 20,000/hour
Region III	VND 17,500/hour
Region IV	VND 15,600/hour

3. Annul the regulation for minimum wage must be higher 7% for a trained employee

Previously, in accordance with the Decree No. 90/2019/ND-CP, the region-based minimum wage levels are the lowest ones, provided that the level of wage to be paid to an employee who works in normal working conditions, ensures sufficient normal working time in a month as prescribed and fulfills labor norms or work as agreed.

Trained employees who are granted a vocational training certificate, vocational training diploma, diploma of professional secondary education, diploma of vocational secondary education, college diploma, certificate of completion of university foundation studies, university degree, bachelor’s degree…are paid with at least 7% higher than the relevant region-based minimum wage level.


However, this regulation is annulled in Decree No. 38/2022/ND-CP. Instead, this Decree only prescribes in general that the minimum wage level is the lowest level which is used for the agreement in paying the monthly wage payment.

At the same time, it is required that enterprises must ensure the job- or title-based wage amount with full normal working hours in a month and fulfills the agreed work but must not be lower than the monthly minimum wage level.

4.  Adjust the regions for applying region-based minimum wage

The Decree 38 also adjusts a number of regions in regions I, II, III, IV, and the region-based minimum wage levels are changed in some localities as follows:

In particulars:

- Region I: Supplement Thu Duc city (from District No.2, District No. 9 and Thu Duc District) in Ho Chi Minh City.

- Some localities are transferred from Region II to Region I: Ha Long city of Quang Ninh, Xuan Loc commune of Dong Nai province.

- Some localities are transferred from Region III to Region II: Quang Yen, Dong Trieu towns of Quang Ninh province, Hoa Binh city and Luong Son commune of Hoa Binh province; Vinh city, Cua Lo town and Nghi Loc and Hung Nguyen rural districts of Nghe An province; Hoa Thanh town of Tay Ninh province; Vinh Long city and Binh Minh town of Vinh Long province; Bac Lieu city of Bac Lieu province.

- Some localities are transferred from Region IV to Region III: Van Don, Hai Ha, Dam Ha, Tien Yen rural districts of Quang Ninh province; Quynh Luu, Yen Thanh, Dien Chau, Do Luong, Nam Dan, Nghia Dan rural districts and towns of Thai Hoa, Hoang Mai of Nghe An province; Mang Thit rural district of Vinh Long province; Hoa Binh rural district of Bac Lieu district.

Here are 04 changes in region-based minimum wage from July 01, 2022.