Wage hike to counter steep cost of living

August 23, 2011 | 11:25

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Workers will see fatter pay packets from October 1, 2011 as the government just ratified minimum wage hike proposals.

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The government enacted Decree 70/2011/ND-CP dated August 22, 2011 regulating minimum region-based wages for labourers working at assorted enterprises, cooperatives, farms, private trading households and foreign invested companies.

Accordingly, from October 1, 2011 to December 31, 2012 minimum region-based salary levels will range from VND1.4 million ($67.9) to VND2 million ($97), from VND300,000 ($14.5) to VND650,000 ($31.4) per month higher than current levels and divided into I, II, III and IV regions.

Decree 70 was enacted after two months seeking comments from relevant ministries, departments and businesses and will cone a quarter earlier than scheduled to help ease labourers’ burdens amid soaring inflation.

Under Decree 70, the fresh region-based minimum wage levels will serve as a footing to develop diverse wage scales and relevant allowances in enterprise payroll.

It is the second minimum wage hike since early 2011 which marks the abolition of minimum wage divergences between local and foreign-invested firms.

The government encourages firms pay their labourers higher than Decree 70 regulated levels.

Decree 70 also reads minimum wages for trained labourers must be at least 7 per cent higher than minimum wages in their corresponding region.

Recent minimum wage revisions

Region	Minimum wage levels from October 1, 2011 to December 31, 2012	Current minimum wage levels to foreign invested enterprises (in light of governmental Decree 107/2010/ND-CP)	Current minimum wage levels to local firms (in light of governmental Decree 108/2010/ND-CP)
I	VND2 million ($97)/month	VND1.55 million ($75.18)/month	VND1.35 million ($65.2)/month
II	VND1.78 million ($86.3)/month	VND1.35 million ($65.2)/month	VND1.2 million ($57.97)/month
III	VND1.55 million ($75.18)/month	VND1.17 million ($56.5)/month	VND1.05 million ($50.7)/month
IV	VND1.4 million ($67.9)/month	VND1.1 million ($53.1)/month	VND830,000 ($40.1)/month