Laws of Vietnam

THE GOVERNMENT

DECREES:

Article 1.- To provide for the common minimum wage level of VND 540,000/month to be applied from January 1, 2008, for payment to laborers doing the simplest jobs under normal working conditions.

1. The common minimum wage level provided for in this Decree applies to:

a/ State agencies, armed forces, political organizations and socio-political organizations;

b/ Non-business units of the State; non-business units of political organizations and socio-political organizations; and non-public non-business units which are set up and operate according to law;

c/ Companies which are set up, organized, managed and operate under the Law on State Enterprises;

d/ One-member limited liability companies with 100% charter capital owned by the State, which are organized, managed and operate under the Law on Enterprises;

e/ Enterprises which are set up, organized, managed and operate under the Law on Enterprises;

f/ Vietnamese cooperatives, cooperative unions, cooperative groups, farms, households, individuals and other organizations that employ laborers.

2. The common minimum wage level provided for in this Decree does not apply to foreign-invested enterprises, foreign agencies and organizations, international organizations and foreigners in Vietnam.

Article 3.- The common minimum wage level provided for in this Decree serves as a basis for:

1. Calculating wage levels in wage scales and tables, and wage-based allowances; and applying other regimes to agencies, units and organizations defined at Points a, b, c and d, Clause 1, Article 2 of this Decree according to law.

2. Calculating region-based minimum wage levels applicable to companies, enterprises, organizations and individuals defined at Points c, d, e and f, Clause 1, Article 2 of this Decree.

3. Calculating allowances to be applied from January 1, 2008, for redundant laborers under the Government's Decree No. 110/2007/ND-CP of June 26, 2007, on policies towards laborers who become redundant due to reorganization of state companies.

4. Calculating deductions and entitlements based on the common minimum wage level.

Article 4.- Funds for application of the common minimum wage level provided for in this Decree to different subjects shall come from the state budget with the following sources:

1. Ten per cent (10%) savings of regular expenditures (excluding salaries and amounts of salary nature) of administrative agencies and non-business units of ministries, central agencies, provinces and centrally run cities.

2. At least 40% of revenues they may retain according to regulations, for non-business units with revenues, or at least 35% of those revenues, for non-business medical units (after subtracting expenses for medicines, blood, transfusion fluids, chemicals, consumed supplies, substitute supplies).

3. At least 40% of revenues of administrative agencies with revenues, which they may retain according to regulations.

4. Fifty per cent (50%) of local budgets' increased revenues.

5. The central budget shall provide:

a/ Additional funds for application of the common minimum wage level in case ministries, central agencies, provinces and centrally run cities have implemented the provisions of Clauses 1, 2, 3 and 4 of this Article but funds are still insufficient;

b/ Support for difficulty-hit localities which cannot yet balance funds averagely equal to one-third of the common minimum wage level for part-time cadres in communes, wards, townships, villages and population groups in accordance with the Government's Decree No. 121/2003/ND-CP of October 21, 2003.

Article 5.- Funds for application of the common minimum wage level to laborers working in companies or enterprises shall be ensured by companies or enterprises and accounted as product costs or production and business expenses.

1. The Ministry of Labor, War Invalids and Social Affairs shall, after consulting the Vietnam General Labor Confederation, labor users' representatives and concerned ministries and branches, submit to the Government the adjustment of the common minimum wage level in each period; guide the application of the common minimum wage level to organizations and individuals defined at Points c, d, e and f, Clause 1, Article 2 of this Decree; and guide the calculation of allowances specified in Clause 3, Article 3 of this Decree for redundant laborers under Decree No. 110/2007/ND-CP of June 26, 2007.

2. The Ministry of Home Affairs shall assume the prime responsibility for, and coordinate with the Ministry of Finance and concerned ministries and branches in, guiding the application of the common minimum wage level to agencies, units and organizations defined at Points a and b, Clause 1, Article 2 of this Decree.

3. The Ministry of Defense and the Ministry of Public Security shall, after reaching agreement with the Ministry of Home Affairs and the Ministry of Finance, guide the application of the common minimum wage level to the subjects under their management.

4. The Ministry of Finance shall assume the prime responsibility for, and coordinate with concerned ministries and branches in:

a/ Guiding the calculation and arrangement of funds for application of the common minimum wage level in accordance with Article 4 of this Decree;

b/ Evaluating and additionally allocating funds for application of the common minimum wage level to ministries, central agencies, provinces and centrally run cities for the cases defined at Point a, Clause 5, Article 4 of this Decree; allocating additional funds for difficulty-hit localities defined at Point b, Clause 5, Article 4 of this Decree; then summing up and reporting on implementation results to the Prime Minister.

Article 7.- This Decree takes effect on January 1, 2008.

To annul the Government's Decree No. 203/2004/ND-CP of December 14, 2004, providing for the minimum wage level, and Decree No. 94/2006/ND-CP of September 7, 2006, adjusting the common minimum wage level.

Article 8.- Ministers, heads of ministerial-level agencies, heads of government-attached agencies and presidents of provincial/municipal People's Committees shall implement this Decree.