Labour Regulations Update in July 2024

I. Decree No.73/2024/ND-CP regulating the basic salary and bonus regime for officials, civil servants, public employees, and the armed forces

On 30^th June 2024, the Government issued the Decree No. 73/2024/ND-CP stipulating the basic salary and bonus regime for officials, civil servants, public employees and the armed forces. Accordingly, from 1^st July 2024, the base salary will increase from 1,800,000 VND/month to 2,340,000 VND/month. With this change, the maximum salary (capped salary) as a basis for Social Insurance and Health Insurance contributions will increase from 36,000,000 VND/month to 46,800,000 VND/month (equivalent to 20 times of the basic salary).

This increase in the basic salary results in an increase in the contribution of statutory social insurance, health insurance, trade union funds and trade union fees and an increase in the levels of allowances entitled to employees such as a one-time allowance for childbirth, convalescence, health rehabilitation, etc. 

II. Decree No.74/2024/ND-CP regulating the minimum salary for employees working under labor contracts

The Government issued the Decree No. 74/2024/ND-CP on 30^th June 2024 regulating the minimum salary for employees working under labor contracts. Accordingly, from 1^st July 2024, the regional minimum salary will change as follows:

The increase in the regional minimum salary leads to an increase in the minimum salary when signing labor contracts with employees, the level of Unemployment Insurance contributions and the level of Unemployment benefits.

III. Official letter No.4773/BHXH-TST on foreign exchange rates in the last 6 months of 2024

On 2^nd July 2024, Ho Chi Minh City Social Insurance Security issued the Official Letter No. 4773/BHXH-TST on foreign exchange rates in the last 6 months of 2024.

Accordingly, the foreign currency conversion rate in Vietnamese Dong applied from 1^st July 2024 in the last 6 months of 2024, for employees with salaries and wages stated in the labor contract in foreign currency is: 24,252 VND/USD (Twenty-four thousand two hundred and fifty-two VND).

IV. Official letter No.2404/BHXH-TST on compulsory social insurance participation for foreign employees working in Vietnam

On 18^th July 2024, Vietnam Social Security issued the Official Letter No. 2404/BHXH-TST on compulsory social insurance participation for foreign employees working in Vietnam.

According to current regulations, foreign employees working in Vietnam with indefinite-term labor contract or labor contract with a term of at least 01 year with an employer in Vietnam but without a work permit or practice certificate or practice license issued by a Vietnamese competent authority are not subject to compulsory social insurance.

However, in the case of foreign employees working in Vietnam with a labor contract that is not subject to issue a work permit (due to marriage to a Vietnamese person) or when starting to work in Vietnam with a work permit, a labor contract subject to compulsory social insurance but then marrying a Vietnamese person, not subject to a work permit, living in Vietnam, Vietnam Social Security requests Ho Chi Minh City Social Security to coordinate with the Department of Labor – Invalids and Social Affairs to report to the People’s Committee of Ho Chi Minh City for information and advises from the Ministry of Labor – Invalids and Social Affairs to implement in accordance with regulations.

Talentnet will continue to update on these cases when there is information from the authorities related to this issue.

V. Decree No.84/2024/ND-CP on pilot decentralization of state management in a number of fields to The Government of Ho Chi Minh city

On 10^th July 2024, the Government issued the Decree No. 84/2024/ND-CP on piloting decentralization of state management in several fields to the Government of Ho Chi Minh City.

Accordingly, in the field of Labor, the City People’s Committee has the authority to approve the need of using foreign workers; confirm that they are not subject to work permit issuance; issue, reissue, extend and revoke work permits for organizations, agencies and enterprises permitted by the Government, the Prime Minister, Ministries, Ministerial-level agencies and agencies under the Government to establish and operate in the City. Previously, the approval authority belonged to the Ministry of Labor, War Invalids and Social Affairs.

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