Update on salary scales and payrolls of employees in 2020

In mid-November 2019, the Government issued a Decree to adjust the regional minimum wage in 2020. Therefore, this is the right time for businesses to rebuild their salary scales and payrolls for the coming year.

Article 7 of Decree 49/2013/ND-CP stipulates: When establishing and deciding salary scales and payrolls for employees, enterprises must ensure:

– The lowest wage for a simple job or title in normal working conditions cannot be lower than the regional minimum wage;

– The smallest payment for a position or title requiring trained or apprenticeship must be at least 7% higher than the local minimum wage;

– The salary of the job or title with heavy, toxic, and dangerous working conditions must be at least 5% higher than the salary of a job or title of equivalent complexity, working under normal circumstances. The salary of a job or title with extremely difficult, toxic, or dangerous working conditions must be at least 7% higher than the salary of a job or title of equivalent complexity, working under normal circumstances.

Thus, in the coming year, enterprises that have paid workers lower than the region-based minimum wage must rebuild the wage scale and payroll.

According to Decree 90/2019 / ND-CP, there will be a local minimum wage adjustment in 2020 as follows:

– Region I: 4.42 million Vietnamese dongs/month;

– Region II: 3.92 million Vietnamese dongs/month;

– Region III: 3.43 million Vietnamese dongs/month;

– Region IV: 3.07 million Vietnamese dongs/month.