The Period From 1985 To 1993

Article 3 of the Decree stipulates that the lowest salary is 27,300 VND per month. The highest salary of the 21-level salary scale is 7.3 times the lowest salary, the highest salary of the 16-level salary scale in the health sector is 5.1 times the lowest salary, the highest salary of the 16-level salary scale in the education sector is 5.2 times the lowest salary, the highest salary of the 12-level salary scale of officers in charge and interpreters is 4.1 times the lowest salary, the highest salary of the 8-level salary scale of agency workers is 2.5 times the lowest salary.

“The 1958 salary regime improved the lives of workers, civil servants, and cadres to a certain extent, contributing to encouraging everyone to strive to boost production and work. The average salary of workers, civil servants, and cadres in 1958 increased by 11.7%. Along with the salary increase, production leadership, market management, and price stabilization were done relatively well, so real salaries increased”  11  .

During this period, our State was both building the country and fighting against French colonialism, so although there were efforts in building laws, the number of legal documents was still very small, legislative techniques were still low, regulations were not really clear and slow to innovate compared to real life. However, to ensure the lives of workers, the State set up allowances (expensive allowances, allowances for bad climate areas, etc.) to compensate for labor. On the other hand, in addition to paying wages in cash, the State applied the payment in kind (rice) to workers.

2.1.2 Period from 1960 to 1985

Our country's economy in this period was still basically an agricultural economy, industry was still small. Farmers made up the majority of the population; the number of unemployed people was still high. Agriculture was the main source of goods, food, and raw materials for handicrafts and industry, but agricultural production was still backward and low-quality. Solving the problem of wages for workers, civil servants, and cadres could not be separated from the above basic situation.

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Wages cannot increase rapidly or much, but must follow the motto "improving people's lives on the basis of developing production and improving social labor productivity".

On the other hand, wages are an issue related to the worker-peasant alliance policy, to the issue of solidarity between workers, civil servants, cadres and soldiers. Point b, Clause 3, Section A of the Resolution of the Government Council on improving the wage regime and increasing wages in 1960 stipulates: “To maintain good relations with the lives of the majority of the people and to be suitable for light and simple jobs, the minimum wage is 27,300 VND per month”. Therefore, to ensure labor relations with the income of farmers and not affect the allocation of labor between urban and rural areas, the State still maintains the general minimum wage of 27,300 VND/month as in 1958.

In the 1960 wage regime, the State had not yet regulated minimum wages by region, however, through the regional allowance regime, it demonstrated the distinction between one region and another through the following factors:

- Bad weather conditions;

- Difficult living conditions and high prices are a regular occurrence;

- Remote working conditions.

Based on the above factors, localities are divided into 7 regions with 7 allowance levels: 40%, 25%, 20%, 15%, 12%, 10%, 6%

In areas with labor shortages and important projects, temporary allowances will be considered to encourage workers to work on projects and partially resolve the difficulties of workers during times when living conditions are unstable.

From 1960 to 1985, although the State did not carry out wage reform and did not announce the minimum wage, in reality, nominal wages were increased many times through temporary subsidies and cash incentives.

Bonuses, incentives for product wages, piecework wages... and adjustment of regional allowances for localities.

The wage regime in effect until August 1985 was basically the 1960 wage regime, supplemented by allowances and subsidies. In terms of wages, allowances and bonuses were larger than rank wages, and the large amount of in-kind wages was not distributed according to work results but was subsidized, thus reducing the significance of wages. It was these shortcomings that the 5th Party Central Committee Resolution pointed out: “We must improve the wage regime, implemented step by step in 1984” and “Redefine the minimum wage”."To ensure that workers have enough to live on and work effectively. Based on the minimum wage and the financial capacity of the State, recalculate the average wage and the highest wage to reduce the average nature, ensure a more reasonable remuneration relationship between different types of workers and civil servants, between different industries and regions"  1  , the Resolution of the 4th Party Central Committee affirmed: "It is necessary to urgently consider and approve a comprehensive plan to improve the wage regime in a step-by-step manner so that wages truly ensure a reasonable relationship between industries and occupations and the uniformity of wages throughout the country, ensuring implementation according to labor"  2  .

2.1.3. Period from 1985 to 1993

On September 18, 1985, the Council of Ministers issued Decree No. 235/HDBT on improving the salary regime for workers, civil servants and armed forces. Article 2 of Decree 235/HDBT stipulates: “The minimum wage is 220 VND per month. This wage corresponds to the price level in areas with the lowest cost of living at present. When the price level changes or in areas with higher cost of living, the wage is calculated with an additional cost of living allowance. The minimum wage is used to pay those who do the simplest labor and under normal working conditions.

service"

The minimum wage is the basis for determining salary levels for ranks or positions.

Decree 235 marked a major step forward in reforming the regime.

Salary. The minimum wage is applied uniformly and calculated scientifically based on factors such as cost of living, nature of work and working conditions. These factors are very similar to the factors used to calculate the current minimum wage. In this Decree, the State has not yet specified the minimum wage by region, however, wages between regions are differentiated through the implementation of regional allowances and cost of living differences.

- Regional allowance: includes 5 allowance levels: 5%, 10%, 20%, 25% calculated as a percentage of salary or position salary depending on climate conditions, remoteness, difficulty in traveling, and lack of material and cultural living conditions.

- Regional cost of living allowance: The allowance rate is based on the difference between the salary calculation price (using the minimum wage as the standard) and the actual price in each locality. The allowance rate is recalculated every 3 months and is regulated by the Council of Ministers. According to Decision No. 308-CT dated September 18, 1985 of the Chairman of the Council of Ministers on regional cost of living allowance for workers, civil servants, armed forces and beneficiaries of monthly allowances and subsidies, the whole country is divided into 13 price regions, each region is divided into 2 areas: urban and rural, corresponding to 26 levels of regional cost of living allowance, the highest level is 28% of the salary of rank and position. On April 4, 1986, due to the rapid increase in the cost of living, the Chairman of the Council of Ministers issued Decision No. 86/CT adjusting the differential cost of living allowances by region.

Since 1987, the cost of living has been increasing rapidly, causing real wages to decline rapidly, so in September 1987, the Council of Ministers

The decision to adjust salaries (including the minimum wage) increased by 13.15 times for production and business units (Decision No. 147/HDBT); 10.68 times for workers, administrative officers, commune and ward officials; 11.51% for armed forces. By April 1988, a coefficient of 13.15 times was uniformly applied; in the following months, a monthly allowance regime was applied on the recalculated salary level according to the coefficient of 13.15.

On December 28, 1988, the Council of Ministers issued Decision No. 202/HDBT on wages for workers, production and business officials in the state-owned sector and joint-venture companies and Decision No. 203/HDBT on wages for workers, administrative and career officials, armed forces and social policy beneficiaries, raising the minimum wage to 22,500 VND/month. Thus, during this period, although the State separated the production sector from the administrative and career sector, the minimum wage prescribed for the two sectors was the same.

Due to the increasing prices, the Council of Ministers continued to implement the hardship subsidy regime. The total subsidy as of March 1993 was 125%, corresponding to the minimum wage of 50,625 VND excluding the monetary amounts.

Thus, during the 5 years (from December 1988 to March 1993), although the economy had many fluctuations and prices increased, the State did not have an official document to adjust the minimum wage but only adjusted it through the hardship allowance regime.

2.1.4. Period from April 1993 to 2004

On May 23, 1993, the Government issued Decree No. 25-CP temporarily regulating the new salary regime for civil servants, administrative and public employees and armed forces, and Decree No. 26-CP temporarily regulating the new salary regime in enterprises. Similar to 1988, the State issued a minimum wage applicable to both the enterprise and administrative sectors, the

The minimum wage is 120,000 VND/month. The minimum wage is determined based on the following criteria:

- Minimum needs and living standards of workers

- Minimum wage in March 1993 (including monetaryization and inflation coefficient allowed by the State)

- Results of the survey on living standards and income in some regions and localities across the country

- Reference data on minimum wages in some countries around the world, especially in the region.

In this new salary regime, the Government has not yet issued regional salaries, however, the distinction of salary levels between regions is demonstrated through the implementation of allowance regimes:

- Regional allowance: Applied to remote areas with many difficulties and bad climate. The allowance includes 7 levels: 0.1; 0.2; 0.3; 0.4; 0.5; 0.7 and 1.0 compared to the minimum wage.

- Expensive allowance: Applied to places where the cost of living index (food) is 10% or more higher than the national average cost of living index. The allowance includes 5 levels: 0.1; 0.15; 0.2; 0.25 and 0.3 compared to the minimum wage.

After the 1992 Constitution was born, our country implemented the policy of wanting to be friends with all countries in the world, expanding cooperation in almost all fields (economics, culture, society, etc.). Therefore, during this period, many foreign investors came to invest and do business in Vietnam and many foreign agencies, organizations, and international organizations in Vietnam. In this situation, both to protect domestic workers and to encourage foreign investment, Clause 3, Article 3 of Decree No. 197/CP dated December 31, 1994 detailing and guiding the implementation of a number of articles of the Labor Code stipulates: "The Ministry of Labor - Invalids and Social Affairs, after consulting the Vietnam General Confederation of Labor, shall :

Vietnam, the State Committee for Cooperation and Investment and representatives of employers submit to the Government for promulgation or the Government authorizes the Ministry of Labor, War Invalids and Social Affairs to promulgate the minimum wage for Vietnamese employees working in foreign-invested enterprises, in Export Processing Zones, Industrial Zones and foreign or international agencies and organizations in Vietnam".

On May 3, 1995, the Minister of Labor, War Invalids and Social Affairs issued Circular No. 11/BLDTBXH guiding the implementation of Decree No. 197/CP mentioned above, announcing the minimum wage level: "The current minimum wage is 35 USD/month, applied to foreign-invested enterprises located in Hanoi and Ho Chi Minh City; 30 USD/month applied to foreign-invested enterprises located in the remaining provinces, cities, towns or enterprises using many simple workers in the fields of agriculture, forestry, aquaculture. For industries and occupations that have agreed on a higher minimum wage, that minimum wage will continue to be applied until a new decision is made."

The promulgation of Decision No. 385/LDTBXH-QD dated April 1, 1996 regulating the minimum wage for Vietnamese employees working in foreign-invested enterprises and foreign agencies, organizations, and international organizations in Vietnam is a testament to Vietnam's integration with the world. Accordingly, the minimum wage is from 30 USD to 45 USD depending on the region and industry (stipulated in Article 1 of Decision No. 385/LDTBXH).

After 3 years of adjusting the minimum wage since 1994, on January 21, 1997, the Government issued Decree No. 06/CP on the settlement of wages and allowances in 1997 for civil servants, administrative and career officials, retirees, people with disabilities, armed forces; commune and ward officials and some beneficiaries of social policies, raising the minimum wage from 120,000 VND/month to 144,000 VND/month.

Next, on December 15, 1999, the Government continued to adjust the minimum wage for those receiving salaries from the state budget from 144,000 VND/month to 180,000 VND/month (According to Decree No. 175/1999/ND-CP) and also stipulated the minimum wage for employees working in state-owned enterprises and enterprises operating under the Enterprise Law (according to Decree No. 10/2000/ND-CP dated March 27, 2000) to 180,000 VND/month. By December 15, 2000, the minimum wage was adjusted to 210,000 VND/month, applicable to both the enterprise and administrative and career sectors (Decree No. 77/2000/ND-CP). And the minimum wage of 210,000 VND/month was maintained until 2004.

2.1.5 Period from 2004 to present

The year 2004 marked a milestone in reforming the new salary regime. With the reform of the salary scale and table in the administrative and career sectors, the salaries of cadres, civil servants and public employees increased significantly. State-owned enterprises are proactive in deciding on salary levels based on labor contracts, proactive in arranging and paying salaries to employees based on production and business efficiency, not necessarily according to the salary scale and table as before. The minimum salary stipulated in 2004 is 290,000 VND per month according to Decree No. 203/2004/ND-CP dated December 14, 2004, applicable to:

“ a) State agencies, public service units, armed forces, political organizations, socio-political organizations;

b) Companies operating under the Law on State-owned Enterprises, including: state-owned companies; independent accounting member companies of the Corporation invested in and established by the State;

c) Companies and enterprises operating under the Law on Enterprises;

d) Cooperatives, cooperative groups, farms, households, individuals and other organizations that hire labor "

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