National Wage Council proposes 6.5% hike next year

National Wage Council proposes 6.5% hike next year

Thuy Dung

After three rounds of negotiations, the National Wage Council has reached an agreement to push for a 6.5% hike in the region-based minimum wages next year – PHOTO: UYEN VIEN

HANOI – After three rounds of negotiations, the National Wage Council has reached an agreement to push for a 6.5% hike in the region-based minimum wages next year. As such, the highest minimum wage would be VND3.98 million (US$175) in region one.

At a press conference on the 2018 minimum wage hike in Hanoi on August 7, Doan Mau Diep, Deputy Minister of Labor, Invalids and Social Affairs and president of the National Wage Council, said the proposed pay raise would help meet 92-95% of the minimum living needs of workers. The council will ask the Government to consider and approve it.

Diep noted representatives of the employer and the employee had taken a slew of factors into account to determine the final minimum wage hike to maintain the minimum living standards, economic growth, labor productivity, and businesses’ ability to pay and retain earnings for reinvestment.

The 6.5% rise is intended to partly help employees cope with higher living costs as the corporate sector is still struggling with tough business conditions, said Hoang Quang Phong, vice president of the Vietnam Chamber of Commerce and Industry.

Phong said more than 73,000 startups were set up while 50,000 companies were forced to close or suspend their operations in the January-July period. Or there were an average of three new enterprises established and two firms dissolved at the same time.

“Besides the minimum pay rise, the minimum living needs of workers are dependent on other factors. We hope employees work harder, improve professional skills and productivity, and maintain labor discipline,” he said.

He suggested they should be offered bonuses based on performance and skill improvement, and benefit from other welfare programs of their employers, hence higher living standards.

Meanwhile, Mai Duc Chinh, vice president of the Vietnam General Confederation of Labor, which represents employees, is not satisfied with the proposed wage rise.

“With a small rise of 6.5%, the wage hike road map may be extended beyond 2020,” Diep said.

He added that for the minimum standards of living, demand for food and non-food items should be taken into consideration. The two sides also should come up with plans for their own minimum living standards.



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