|Workers of Arksun Viet Nam JSC in the northern Nam Dinh-based Hoa Xa Industrial Park. As of January 2014, monthly minimum wage for employees will see an increase following a decree issued recently by the Government. — VNA/VNS Photo Danh Lam
HA NOI (VNS) — A new decree issued by the Government will lead to an increase in the monthly minimum wage from January 1.
Decree 182 will see increases of up to VND2.7 million (US$130) per month, and will apply to enterprises, co-operatives, household businesses, foreign companies and international organizations operating in Viet Nam.
The new arrangement replaces the current Decree 103/2012/ND-CP, applied from December last year and which also stipulated minimum payments for Vietnamese staff.
The minimum wage will be applied in four different regions in Viet Nam with four separate benchmarks determined by living standards in each area.
The thresholds will be VND1.9 million, VND2.1 million, VND2.4 million and VND2.7 million, accounting for an increase of VND250,000-350,000 compared with the current minimum wage.
The regulation also stipulates skilled workers that have received vocational training or a higher level of training must be paid at least 7 per cent more than the regional minimum wage for workers.
Issued to protect employees from being underpaid, the Decree also encourages enterprises to pay their employees more than the region-based minimum wages.
The new Decree will take effect on December 31 this year.
Salaries in Viet Nam are set to rise 11.5 per cent in 2014, equivalent to 4.9 per cent after inflation, according to a forecast from professional services company Towers Watson Vietnam.
The forecast was based on a survey conducted from June to September this year by the company, which collected information from approximately 110,320 incumbents from 312 companies in Viet Nam.
According to Towers Watson's forecast, pay rises in Viet Nam and China will top those in East Asia after inflation, with salaries across Asia Pacific are set to rise an average 7 per cent in 2014.
The company predicts that salaries in Hong Kong and Singapore will rise 4.5 per cent, while India and Japan will see 11 per cent and 2.3 per cent increases, respectively.
The forecasted pay rise for next year, however, is still slightly lower than this year's actual salary increase at 11.7 per cent.
"Given the fact that inflation is expected to be under control, there would be no room for a significant jump in salary increases in 2014," said Trang Vu, global data services manager at Towers Watson Vietnam.
While the retail sector in Viet Nam is expected to see the biggest pay rises at 14.5 per cent in 2014, the financial services sector, for the first time in recent years, will see a rise of only 10 per cent, down from 2013, the company predicted. — VNS