Apply regional minimum wage from 2024 Vietnam

The new Decree of the Government promulgates regulations on adjusting the regional minimum wage from July 1, 2024. Accordingly, it clearly states the list of localities applying the regional minimum wage in 2024. Details will be shared with you by S4B Vietnam in the article below.

1. List of localities applying the regional minimum wage in 2024

Based on Decree No. 74/2024/ND-CP dated June 30, 2024 of the Government on the minimum wage for employees working under labor contracts. Accordingly, from July 1, 2024, the regional minimum wage will be officially adjusted to increase by an average of VND 200,000 to VND 280,000 depending on the region (specified in the Appendix of this Decree).

2. Apply regional minimum wage from 2024 Vietnam

The application of regional areas is determined according to the place of operation of the employer (NSDLĐ) as stipulated in Clause 3 of Decree 74/2024/ND-CP, accordingly:

  • If the employer operates in a region, the minimum wage prescribed for that region shall be applied.
  • If the employer has units or branches operating in areas with different minimum wages, the unit or branch operating in which area shall apply the minimum wage prescribed for that area.
  • If the employer operates in industrial parks or export processing zones located in areas with different minimum wages, the minimum wage shall be applied according to the area with the highest minimum wage.
  • If the employer operates in an area with a change in name or administrative division, the minimum wage prescribed for the area before the change in name or administrative division shall be temporarily applied until the Government has new regulations.
  • Employers operating in a newly established area from one or more areas with different minimum wages shall apply the minimum wage according to the area with the highest minimum wage.
  • Employers operating in a city under a province newly established from one or more areas in Region IV shall apply the minimum wage prescribed for the remaining city under a province in Region III (stipulated in Clause 3, Appendix).

Thus, the regional minimum wage from July 1, 2024 is stipulated in Decree 74/2024/ND-CP and divided into regions I, II, III and IV. Employees working under labor contracts can use the list of areas applying the regional minimum wage to determine their monthly minimum wage and hourly minimum wage.

Increasing basic and minimum wages in Vietnam from July 2024

3. How will the regional minimum wage change from July 1, 2024?

According to Article 3 of Decree 74/2024/ND-CP, the minimum monthly wage and minimum hourly wage for employees working for employers by region are stipulated as follows:

Area Minimum monthly wage (Unit: VND/month) Minimum hourly wage (Unit: VND/hour)
Area I 4.960.000 23.800
Area II 4.410.000 21.200
Area III 3.860.000 18.600
Area IV 3.450.000 16.600

4. How to apply the regional minimum wage?

According to Article 4 of Decree 74/2024/ND-CP, the application of the regional minimum wage is implemented as follows:

[1] The monthly minimum wage is the lowest wage that serves as the basis for negotiating and paying wages to employees applying the monthly wage payment method, ensuring that the wage according to the job or position of employees working enough normal working hours in a month and completing the agreed labor norms or work must not be lower than the monthly minimum wage.

[2] The hourly minimum wage is the lowest wage that serves as the basis for negotiating and paying wages to employees applying the hourly wage payment method, ensuring that the wage according to the job or position of employees working for one hour and completing the agreed labor norms or work must not be lower than the hourly minimum wage.

Decree 74/2024/ND-CP Regulates Regional Minimum Wage

[3] For employees who apply the form of weekly or daily wages or piecework or contract wages, the wages of these forms of wages, if converted to monthly or hourly wages, must not be lower than the monthly minimum wage or hourly minimum wage. The monthly or hourly wages based on normal working hours chosen by the employer according to the provisions of the labor law are as follows:

  • The monthly wage is equal to the weekly wage multiplied by 52 weeks divided by 12 months; or the daily wage multiplied by the number of normal working days in a month; or the product wage, contract wage performed during normal working hours in a month.
  • The hourly wage is equal to the weekly or daily wage divided by the number of normal working hours in a week or day; or the product wage, contract wage divided by the number of working hours in normal working hours to produce products and perform contract tasks.

If you need more information regarding Apply regional minimum wage from 2024 Vietnam, please contact S4B Vietnam for support.

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