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VietNamNews

Minimum wage set to rise 15%

Update: August, 07/2014 - 08:52
Textile workers in Thanh Hoa Province manufacture clothes for export. The National Wage Council will ask the Prime Minister for an average increase of 15.1 per cent in regional-based minimum wages next year. — VNA/VNS Photo Tran Viet.

HA NOI (VNS) — The National Wage Council will ask the Prime Minister for an average increase of 15.1 per cent in region-based minimum wages next year.

Regional minimum wages are now decided by the council, which was established last year. It provides an equal voice to the Government, employers' organisations and trade unions.

If approved, the wages would be applied to every private sector company, business, co-operative, farm, household,individual and organisation that hires people.

The wages vary in four different regions throughout Viet Nam and there are four separate benchmarks determined by living standards in each area.

Regional minimum wages for 2014 range from VND1.9 million (US$90) to VND2.7 million ($129) a month.

At a meeting yesterday, members of the council reached agreement on regional minimum wages for 2015.

Accordingly, in region I, including urban Ha Noi, Hai Phong, HCM City, the proposed minimum wage will be VND3.1 million ($145.7 ), or VND400,000 higher than at present.

In region two, including rural Ha Noi, HCM City, Hai Phong plus the main cities of Hai Duong, Hung Yen, Bac Ninh, Thai Nguyen, Nha Trang, Can Tho and Rach Gia, the proposed wage would be VND2.75 million ($130), or VND350,000 higher than currently.

In region three, which includes provincial cities and the main districts in the provinces of Hai Duong, Vinh Phuc, Phu Tho, Bac Ninh, Nam Dinh, Phu Yen, Dong Nai and Tien Giang, Ben Tre, the proposed wage would be VND2.42 million ($114) or VND320,000 higher.

In region four, the least developed areas in Viet Nam, the proposed wage would be VND2.2 million ($103 ) or VND300,000 higher.

Head of National Wage Council and Deputy Minister of Labour, Invalid and Social Affairs, Pham Minh Huan, said that the proposal was expected to be approved by October and would take effect next year.

"The increase will pave the way to regional minimum wages that can help meet minimum living conditions for employees and labourers in private sectors until 2017," he said.

At present, regional minimum wages met only 70 per cent of minimum living conditions.

Huan said that next year, the council would take into account more indicators to calculate regional minimum wages.

These would include the consumer price index (CPI), salary gaps between formal and informal sectors - and between big and small companies.

The council also proposed the Prime Minister establish a council to examine productivity. It said this would help set wage levels that could ensure proper living standards for employees and healthy competition among employers.

Vice Chairman of the Viet Nam Chamber of Commerce and Industry (VCCI), Hoang Van Dung said that agreeing on an increase of 15 per cent for minimum wage was a great compromise by employers.

At the latest meeting over the same issue held last month, they recommended an increase of 11 per cent.

Arriving the meeting yesterday, the VCCI said it was willing to negotiate for an increase of less than 14 per cent. — VNS

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