A new decree raising the regional minimum wage for labourers was approved on June 12 by Deputy Prime Minister Pham Binh Minh.

Illustrative image (Source: VNA)

The new regulation, coded 38/2022/ND-CP will come into effect on July 1.

The 6 percent increase is equivalent to a rise of 260,000 VND (11.20 USD) in Region 1, and 240,000 VND, 210,000 VND, and 180,000 VND in Regions 2, 3, and 4, respectively.

The document also specifies that the minimum hourly wage will range from 15,600 to 22,500 VND (0.70-1 USD), which also depends on the region.

The geographical classification is determined based on the employer’s place of operation.

Region 1 covers Ha Noi and Ho Chi Minh City's urban areas; Region 2 encompasses Ha Noi and HCM City's rural areas, along with major urban areas in the country like Can Tho, Da Nang and Hai Phong; Region 3 covers provincial cities and the districts of Bac Ninh, Bac Giang and Hai Duong provinces; and Region 4 comprises the rest of the country.

The change is applicable to workers and employers under labour contracts in accordance with the Labour Code.

The resolution also defines minimum wage as the lowest amount that can be paid to an employee, which is the basis for negotiation and compensation, in the form of a monthly salary. This amount corresponds to the workload and job title in designated work hours, given that the employee fulfils their tasks as assigned.

For workers who are paid on a daily or weekly basis, or based on a piece rate, then their salary, when converted to the monthly or hourly rate, must not be lower than the minimum wage.

Source: VNA