Workers at Vissan Company. (Photo: nhandan.vn)

The Draft Decree regulating the minimum wage for employees working under labor contracts (hereinafter referred to as the draft Decree) developed by the Ministry of Home Affairs is being appraised by the Ministry of Justice .

Current minimum wage does not guarantee a minimum standard of living until the end of 2026

The Ministry of Home Affairs said that from July 1, 2024, the Government issued Decree No. 74/2024/ND-CP dated June 30, 2024 stipulating the minimum wage for employees working under labor contracts (referred to as Decree No. 74/2024/ND- Government ), in which the minimum wage is adjusted to increase by an average of 6% compared to 20221.

Currently, the minimum monthly wage in region I is 4,960,000 VND, region II is 4,410,000 VND, region III is 3,860,000 VND, region IV is 3,450,000 VND; the minimum hourly wage in region I is 23,800 VND/hour, region II is 21,200 VND/hour, region III is 18,600 VND/hour, region IV is 16,600 VND/hour.

Through assessment, the minimum wages stipulated in Decree No. 74/2024/ND-CP have ensured a minimum standard of living and improved for workers; at the same time, there is a sharing and harmonization of interests between workers and enterprises, both improving the lives of workers and ensuring the maintenance, recovery and development of production and business of enterprises.

However, up to now, in reality, there are a number of issues that need to be considered in adjusting the minimum wage stipulated in Decree No. 74/2024/ND-CP mentioned above.

Firstly, socio-economic factors, labor market, and business capacity have changed in a more positive direction. Specifically, the macro economy continues to be stable, the economic growth rate (GDP) in the first 6 months of 2025 reached 7.52%, the target for 2025 is 8% or more. The labor market is stable and maintains the recovery momentum; business production and business tend to be better. Wages and income of workers continue to be stable and increase, each quarter is higher than the previous quarter.

Second, the actual value of the minimum wage in Decree No. 74/2024/ND-CP has gradually declined over time due to the increase in the consumer price index (CPI). With the CPI expected to increase by 3.7% each year in 2025 and 2026, the above minimum wage will no longer ensure the minimum living standard of workers and their families by the end of 2026 (about 6.6% lower).

Third, the minimum wage in Decree No. 74/2024/ND-CP is determined by region and linked to district-level administrative boundaries .

With the CPI expected to increase by 3.7% each year in 2025 and 2026, the above minimum wage will no longer ensure the minimum living standard of workers and their families by the end of 2026 (about 6.6% lower).

From July 1, 2025, after restructuring administrative units nationwide, the localities applying minimum wages have been reviewed and adjusted by the Government in a step-by-step manner in association with new commune-level administrative units (in the Appendix attached to Decree No. 128/2025/ND-CP dated June 11, 2025 of the Government).

However, since this is a policy that has a wide impact on many subjects, including businesses and workers. Therefore, the localities applying minimum wages according to commune-level administrative units need to continue to be reviewed and updated to suit the actual situation in the localities after the rearrangement.

On Wednesday, July 25, 2025, the National Wage Council submitted a report to the Government recommending an average increase of 7.2% in the minimum wage, effective from January 1, 2026.

Based on the above reality, it is necessary to develop a Decree regulating the minimum wage to be applied in 2026, in order to (i) ensure the minimum living standard of workers, increase workers' wages in accordance with labor productivity, economic growth, and competitiveness of enterprises as prescribed in Article 91 of the 2019 Labor Code; (ii) review and update the areas where the minimum wage is applied to suit the actual situation.

The Ministry of Home Affairs commented that, regarding the implementation of Decree No. 74/2024/ND-CP , the People's Committees of provinces/cities and enterprises have seriously implemented the Government's regulations on minimum wages. Most enterprises with the lowest wages actually pay their employees higher than the minimum wage announced by the Government. The adjustment of the minimum wage has a positive impact on employees, ensuring that their lives are improved.

According to the results of the survey on the labor and salary situation in enterprises in 2024, the implementation and impact of the adjustment of the regional minimum wage in 2024 are as follows: 22.04% of enterprises only adjust the salary scale and table (used to participate in social insurance); 45.4% of enterprises adjust both the salary scale and the actual salary paid to employees; 5.27% of enterprises make other adjustments and 27.29% of enterprises do not adjust salaries (because all salaries are higher than the regional minimum wage).

Among the enterprises adjusting salary scales and tables (72.71%), 68.93% of enterprises adjusted salaries for all employees with an average increase of 6.71%; 24.83% of enterprises only adjusted for employees with salaries lower than the minimum wage, with an increase of 6.43%.

In general, most businesses comply with regulations on minimum wages, the lowest wage paid to employees who work a full normal working day in a month is 22-42% higher than the minimum wage prescribed by the Government, depending on the region.

Region	Minimum wage period 2024 - 2025	Minimum wage actually paid
Region	Minimum wage period 2024 - 2025	2023	From July 2024
Region 1	4,960	5,830	6,180
Region 2	4,410	5,060	5,380
Region 3	3,860	4,900	5,140
Region 4	3,450	4,710	4,900

Reports from the People's Committees of provinces/cities show that the issuance of the minimum hourly wage is highly appreciated by enterprises, basically does not have much impact on the labor relations situation in enterprises, as well as on salary payment in the market; does not change the salary payment policy.

Therefore, it is necessary to issue a Decree to adjust the minimum wage to ensure the minimum living standard of workers; at the same time, review and update the areas where the minimum wage is applied to suit the actual situation after the rearrangement of administrative units.

Update the area applying minimum wage after administrative unit arrangement

Workers at Vinamilk Company. (Photo: nhandan.vn)

The Ministry of Home Affairs has drafted a Decree regulating the minimum wage for employees working under labor contracts. Includes 5 articles and 1 appendix with regulations on the list of areas applying the minimum wage.

The draft stipulates adjusting the minimum wage to increase by 7.2% compared to the current level to apply from January 1, 2026.

First of all, regarding the minimum wage, the draft Decree stipulates the monthly minimum wage according to 4 regions: region I is 5,310,000 VND/month, region II is 4,730,000 VND/month, region III is 4,140,000 VND/month, region IV is 3,700,000 VND/month.

The above minimum wage increases from VND 250,000 to VND 350,000 (equivalent to an average rate of 7.2%) compared to the current minimum wage. The above minimum wage adjustment is about 0.6% higher than the minimum living standard of workers until the end of 2026 to improve the lives of workers.

This adjustment level shares and harmonizes the interests of workers and enterprises, paying attention to improving the lives of workers while ensuring the maintenance and development of production and business of enterprises.

The draft Decree stipulates minimum hourly wages in 4 regions: region I is 25,500 VND/hour, region II is 22,700 VND/hour, region III is 20,000 VND/hour, region IV is 17,800 VND/hour.

The minimum hourly wage continues to be determined based on the equivalent conversion method from the minimum monthly wage and standard working time as prescribed by the Labor Code. This is the method that experts from the International Labor Organization (ILO) have recommended for Vietnam to choose and have used when calculating the minimum hourly wage from 2022 to present.

One content of interest in this draft Decree is the area of application.

Decree No. 128/2025/ND-CP dated June 11, 2025 stipulates the list of localities applying the minimum wage according to the new commune-level administrative unit. However, after localities operated according to the new provincial-level administrative unit, some of the applied localities were rearranged and changed compared to the time of promulgation of the Decree in June; at the same time, Decree No. 128/2025/ND-CP mentioned above will expire from March 1, 2027. Therefore, the draft Decree stipulates the new list of applied localities on the basis of inheriting the current list prescribed in Decree No. 128/2025/ND-CP mentioned above and has been reviewed and updated at the request of the Provincial People's Committee.

Specifically, the draft changes the name of Hoang Van Thu ward (in Lang Son province) to Ky Lua ward.

Adjust from zone II to zone I for: wards of Chu Van An, Chi Linh, Tran Hung Dao, Nguyen Trai, Tran Nhan Tong, Le Dai Hanh, Kinh Mon, Nguyen Dai Nang, Tran Lieu, Bac An Phu, Pham Su Manh, Nhi Chieu and communes of Nam An Phu, Nam Sach, Thai Tan, Hop Tien, Tran Phu, An Phu, Cam Giang, Cam Giang, Tue Tinh, Mao Dien, Ke Sat, Binh Giang, Duong An, Thuong Hong, Gia Loc, Yet Kieu, Gia Phuc, Truong Tan, Tu Ky, Tan Ky, Dai Son, Chi Minh, Lac Phuong, Nguyen Giap, Nguyen Luong Bang, Phu Thai, Lai Khe, An Thanh, Kim Thanh (belonging to Hai Phong city).

Adjusting from region III to region II for: Hoang Mai ward, Tan Minh ward (belonging to Nghe An province); Dong Ha ward, Nam Dong Ha ward (belonging to Quang Tri province); Phan Rang, Dong Hai, Ninh Chu, Bao An, Do Vinh ward and Thuan Bac, Cong Hai communes (belonging to Khanh Hoa province); Thanh Ha, Ha Tay, Ha Bac, Ha Nam, Ha Dong, Ninh Giang, Vinh Lai, Khuc Thua Du, Tan An, Hong Chau, Thanh Mien, Bac Thanh Mien, Nam Thanh Mien, Hai Hung communes (belonging to Hai Phong city).

Adjust from region IV to region III for: Quang Tri ward and communes Dong Le, Vinh Linh, Cua Tung, Ben Quan, Cua Viet, Gio Linh, Cam Lo, Khe Sanh, Lao Bao, Trieu Phong, Huong Hiep, Dien Sanh (belonging to Quang Tri province); communes Ninh Son, Lam Son, Anh Dung, My Son, Thuan Nam, Ca Na, Phuoc Ha (belonging to Khanh Hoa province).

Adjust from region I to region IV for communes Ky Thuong and Luong Minh (belonging to Quang Ninh province).

Adjust from region III to region IV for: communes of Thuong Trach, Truong Son, Kim Ngan (belonging to Quang Tri province).

The regional adjustment of the above localities aims to create a reasonable balance in labor prices between neighboring localities, because the above localities have more developed labor markets, formed industrial zones and clusters, significantly improved infrastructure conditions, and are adjacent to other localities with higher minimum wages.

The minimum wage adjustment will be implemented from January 1, 2026 to ensure time for businesses to prepare plans and resources for implementation.

According to the Ministry of Home Affairs, the above minimum wage plan has taken into account the impacts on employment, unemployment, production and business conditions of enterprises, and the level of impact on production costs of enterprises.

For employees currently receiving wages lower than the minimum wage, they will be readjusted to ensure they are not lower than the new minimum wage.

For employees who have been paid equal to or higher than the new minimum wage, the adjustment will be made according to the commitments and agreements of the parties stated in the collective labor agreement, labor contract, and company regulations.

According to Nhan Dan Newspaper

Source: https://baotuyenquang.com.vn/xa-hoi/202509/de-xuat-dieu-chinh-dia-ban-ap-dung-luong-toi-thieu-sau-sap-xep-don-vi-hanh-chinh-d2878f9/