Increasing the regional minimum wage and reforming wages are key programs
At the end of 2023, the National Wage Council met and finalized a plan to increase the regional minimum wage. The salary increase proposal of the Salary Advancement Council is being submitted to the Prime Minister for approval. It is expected that from July 1, 2024, the minimum wage for workers will be increased by 6% compared to today.
With the minimum wage adjustment of 6%, the regional minimum wage will increase from 200,000 VND to 280,000 VND depending on the region, of which, the salary in region 1 will increase to 4.96 million VND; Region 2 is 4.41 million VND; Region 3 is 3.86 million VND and region 4 is 3.45 million VND.
Along with that, from July 1, salary policy reform will be implemented according to Resolution No. 27-NQ/TW of the 7th Central Conference (term XII).
It is expected that the salary reform will increase the salaries of civil servants and public employees by 30%. Photo: NT
According to the Government’s announcement, starting from July 1, the Government will conduct salary reform. Up to this point, 100% of ministries, branches and units have completed the construction of salary tables by job position.
Minister of Home Affairs Pham Thi Thanh Tra once said that it is expected that the average salary of cadres, civil servants and public employees will increase by regarding 30%, a significant increase compared to the average annual increase of 7%. when salary reform has not been implemented.
Thus, adjusting the regional minimum wage and reforming wages helps social insurance wages to be higher, contributing to increasing workers’ pensions.
Salary reform: Adjust monthly salary for social insurance payment
From January 1, 2024, the Circular regulating the adjustment of salaries and income paid for social insurance (issued by the Ministry of Labor, Invalids and Social Affairs) takes effect.
Accordingly, the subjects to adjust the salary paid for social insurance include employees who are subject to the salary regime prescribed by the State and start participating in social insurance from January 1, 2016 onwards, enjoying one-time social insurance. or die and relatives are entitled to a one-time death benefit from January 1, 2024 to December 31, 2024.
In addition, employees pay social insurance according to the salary regime decided by the employer, receive pensions, one-time benefits upon retirement, one-time social insurance or death without relatives. are entitled to a one-time death benefit from January 1, 2024 to December 31, 2024.
Subjects adjusting monthly income for which social insurance has been paid according to regulations are voluntary social insurance participants who receive pensions, lump-sum benefits upon retirement, lump-sum social insurance, or those who die without relatives. are entitled to a one-time death benefit from January 1, 2024 to December 31, 2024.
With the adjustment of monthly salary paid for social insurance from January 1, 2024, the average monthly salary paid for social insurance will increase. Besides, according to the salary calculation formula mentioned, the pension level will also increase.
This increase is to ensure pensions do not slip in price compared to consumer prices.
Wage reform: Adjusting pensions
The National Assembly’s resolution on the state budget estimate for 2024 approves the state budget estimate for the year, with revenues determined to be regarding 1.7 million billion VND.
Regarding implementing salary reform, the Resolution clearly states that, from July 1, 2024, implementing overall salary policy reform according to Resolution No. 27-NQ/TW, adjusting pensions and insurance benefits Social benefits, monthly allowances, preferential allowances for people with meritorious services and a number of social security policies are linked to the base salary.
Along with wage reform, workers’ pensions will also change. Photo: NH
Funding for implementing wage reform is guaranteed from the accumulated wage reform source of the central budget, local budget and is partly allocated in the state budget balancing expenditure estimate.
Thus, pensions will be adjusted from July 1, 2024. However, the specific adjustment needs to wait for the Government’s regulatory documents.
The latest pension increase is from July 1, 2023 according to the provisions of Decree 42/2023/ND-CP with an increase of 12.5% or 20.8% depending on specific subjects.