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Minimum wage is a basic need

Update: July, 06/2015 - 08:53

Minimum wages have to be high enough to meet the minimum needs of workers, and have to be adjusted to rising living costs, Labour Minister Pham Thi Hai Chuyen tells online newspaper VOV (VOV.VN).

Many employees want to know how their minimum wage will be adjusted in 2016. Do you have the answer?

In October, the National Wages Council (NWC), which comprises the Government, trade unions, enterprise representatives will meet up to estimate the minimum wage for workers in all four wage zones in the country.

The new minimum wage will be higher than this year and directly proportional to inflation.

I cannot give you a concrete answer at the moment on what the minimum wage will be because the NWC has yet to convene. Once it does, it will propose the rate to the Government and a final decision will be taken by the Prime Minister.

In principle, enterprises have to decide for themselves what they will pay their employees. Most enterprises pay their employees only the basic salary, without other allowances (for lunch, fuel, telephone, etc.) Therefore, the minimum wage for the non-State sector has to be higher. For State employees, salaries rise every three years, but in the private sector, enterprises can decide when they want to raise their employees' salary.

According to the General Statistic Office, the current minimum wage only meets 63 per cent of the minimum living standard. Which is why we have to think of raising the minimum wages every year.

Is this wage increase supported by many people?

In general, yes. Enterprises complain. They ask why wages have to be raised when they are suffering from the ongong economic crisis. However, the truth is that employees' wages, particularly of those working in FDI (foreign direct investment) enterprises, is still very low in comparison to the enterprises' revenues.

Some say that the Government should not set a common wage rate for all enterprises. They say the wages should depend on each enterprises' labour productivity. What is you opinion?

The National Wages Council (NWC) will consider this. But the reality is that most enterprises use the minimum wage rate in fixing their employees' salaries. Enterprises with labour productivity will have their own specific remuneration rules. Sometimes, they can pay salaries that are ten times higher than the minimum wage.

The Government only fixes the minimum rate, forcing enterprises to pay this to their employees irrespective of their financial situation.

Every October, the enterprises have to propose a plan to raise wages for the next year. For its part, the Government has to fix it no later than November so that enterprises can make their financial plans accordingly. — VNS

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