On November 16, 2018, the Government issued Decree No.157/2018/ND-CP on region-based contribution wages applied to employees working under labour contracts.

Under the decree, from January 1, 2019, the region-based contribution wage for enterprises located in region I is 4,180,000 VND per month, while that for enterprises located in region II is 3,710,000 VND per month, for enterprises located in region III it is 3,250,000 VND per month, and for enterprises located in region IV it is 2,920,000 VND per month.

Therefore, the wages for social, health and unemployment insurance calculation for labourers will also be changed.

In Ho Chi Minh City, under the Government’s Decree No.115/2015/ND-CP dated November 11, 2015 detailing articles of the Social Insurance Law regarding compulsory social insurance and the Government’s Decree No.157/2018/ND-Cp issued on November 16, 2018, on December 20, 2018, the city’s Social Insurance Agency issued document No.2717/BHXH-QLT giving guidelines on the payment of social, health and unemployment insurance as well as occupational accident and illness insurance.

Accordingly, from January 1, 2019, employers must review the contribution wage in the pay roll they submitted to state management agencies for adjustments to ensure the wage is not lower than the new regional contribution wages, thus amending wages for calculation of social, health and unemployment insurance as well as occupational accident and illness insurance for each labourer in line with their pay.

The new regional-based in the city is applied as follow:

The wage of 4,180,000 VND per month is applied on labourers of companies and agencies operated in urban/suburban districts of Cu Chi, Hoc Mon, Binh Chanh and Nha Be.

The wage of 3,710,000 VND per month is applied on labourers in companies and agencies operating in Can Gio district.

Enterprises operating in Ho Chi Minh City and running branches in regions with different contribution wage levels will apply the level applicable to the region that each branch is based.

Businesses must pay the wage agreed in the labour contract as well as the social, health, unemployment insurance, and occupational accident and illness insurance at the level that is

- not lower than the region-based contribution wage paid to an unskilled worker who performs simplest duties; and 

- at least 7 percent higher than the region-based contribution wage paid to skilled workers prescribed in Clause 2 of Decree No.157/2018/ND-CP.

On February 28, 2019 at the latest, employers must submit dossiers on the adjustments of social, health, unemployment, occupational accident and illness insurance for labourers in line with the new region-based contribution wages.

If businesses do not make adjustments by the due date, social insurance agencies will temporarily amend the wages for social, health, unemployment insurance, and occupational accident and illness insurance calculation to match the region-based contribution wages for labourers and additional 7 percent for skilled workers until businesses submit the adjustments in conformity with regulations.

Social insurance agencies will only recognise the process of joining social and unemployment insurance and process benefits when employers submit the dossiers with adjustments in line with regulations. Employers will bear complete responsibilities for any delay that affects the processing of benefits for labourers.