Workers at Dony Garment Co., Ltd. resume work after the New Year holiday. The MoLISA has officially requested local authorities to review and update the geographical areas where the minimum wage is applied. VNA/VNS Photo Hồng Đạt

Vietnam is preparing for a potential increase in the regional minimum wage in 2025, with proposals being developed by both the Ministry of Labour, Invalids and Social Affairs (MoLISA) and the Việt Nam General Confederation of Labour (VGCL).

This coordinated effort aims to improve workers' living standards and ensure that wage policies align with the country's economic growth and evolving administrative boundaries.

The ministry has officially requested local authorities to review and update the geographical areas where the minimum wage is applied.

This move is part of efforts to align wage regulations with recent administrative changes and ensure fair compensation for workers across the country.

On February 21, MoLISA issued an official document asking local authorities to re-evaluate the regions applicable to the minimum wage policy, considering recent changes to administrative boundaries, including renaming, merging and altering administrative units, as directed by the National Assembly’s Standing Committee.

This request follows the Government's issuance of Decree No 74/2024/NĐ-CP on June 30, 2024, which set regional minimum wages for workers under labour contracts. The Decree classified minimum wages by region, corresponding to administrative divisions at the district level.

Since then, several provinces and centrally-run cities have undergone changes in their administrative structure, necessitating a review and update of the regions where the minimum wage applies to maintain consistency with the new administrative landscape.

MoLISA has instructed provincial and municipal People's Committees to oversee local labour management agencies in coordinating with relevant departments to review applicable regions. Local areas must update the names of administrative units subject to the minimum wage, assess current regional classifications and propose necessary adjustments.

The review process involves collaboration with management boards of export processing zones and industrial parks, as well as consultations with provincial trade unions, branches of the Việt Nam Chamber of Commerce and Industry (VCCI), professional associations, investors, and businesses. Based on this, they will compile reports and submit their recommendations to MoLISA through their respective provincial and municipal People's Committees.

Under Decree No 74/2024/NĐ-CP, which took effect on July 1, 2024, the Government implemented an average minimum wage increase of 6 per cent.

The monthly minimum wages were adjusted to VNĐ4.96 million (US$200) for Region I, VNĐ4.41 million ($180) for Region II, VNĐ3.86 million ($160) for Region III, and VNĐ3.45 million ($140) for Region IV.

Hourly minimum wages also rose accordingly, with Region I at VNĐ23,800 ($0.98) per hour, Region II at VNĐ21,200 ($0.87) per hour, Region III at VNĐ18,600 ($0.77) per hour and Region IV at VNĐ16,600 ($0.68) per hour.

To prepare for further adjustments in 2025, MoLISA conducted a 2024 survey on wages and labour conditions at 3,400 businesses, involving 6,800 workers across 18 provinces and cities.

The survey results will help establish average wage benchmarks in the labour market and support negotiations between businesses and workers.

Meanwhile, the VGCL has also been proactive in preparing a proposal for a regional minimum wage increase. According to Lê Đình Quảng, Deputy Head of the Policy, Legal Affairs, and Industrial Relations Department at VGCL, the organisation is completing its proposal based on recent surveys of workers' living conditions and earnings during the Tết (Lunar New Year) holiday.

Preliminary surveys by the VGCL indicate that most workers desire a minimum wage increase, as this directly impacts those with low incomes. Many workers hope for a wage adjustment in 2025 to help meet their living costs. The confederation plans to formally present this proposal in early March.

Quảng highlighted that the regional minimum wage serves as a baseline to ensure minimum living standards for workers. However, he stressed the need to strengthen grassroots trade unions' capacity to help workers negotiate higher wages through collective bargaining agreements. For Quảng, the ultimate goal is to enable even disadvantaged workers to secure wages above the minimum threshold by enhancing their negotiation skills and legal awareness.

With Việt Nam targeting economic growth of over 8 per cent in 2025 and aiming for double-digit growth in subsequent years, higher labour productivity will create a foundation for raising the minimum wage. According to Quảng, investing in wages is investing in development and human resources, aligning with the National Assembly's recent economic growth resolution.

Quảng noted that increases in wages not only improve workers' lives but also boost labour productivity, contributing to economic growth. As the economy grows, workers should benefit from the nation's economic achievements, ensuring that the gains from development are shared equitably. — VNS