Building a new Decree on minimum wage increase applicable from 2026

(Chinhphu.vn) - The Ministry of Home Affairs is drafting a Decree regulating the minimum wage for employees working under labor contracts, with an increase of 7.2% compared to the current level, expected to apply from January 1, 2026.

Draft Decree stipulates adjusting the minimum wage to increase by 7.2% compared to the current level to apply from January 1, 2026 - Photo: VGP/Thu Giang

According to the Ministry of Home Affairs , most recently, on June 30, 2024, the Government issued Decree No. 74/2024/ND-CP stipulating the minimum wage for employees working under labor contracts, with an average increase of 6% compared to 2022.

Accordingly, from July 1, 2024, the monthly minimum wage will be applied in 4 regions: 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 practical implementation, this minimum wage has contributed to ensuring a minimum standard of living and improving it for workers; sharing and harmonizing the interests of 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, there are a number of issues that need to be considered in adjusting the minimum wage. In particular, socio -economic factors, the labor market, and the capacity of enterprises have changed in a more positive direction.

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 of enterprises tends to be better; wages and income of workers continue to be stable and increase, each quarter is higher than the previous quarter.

The actual value of the minimum wage in Decree No. 74/2024/ND-CP has gradually decreased 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).

The minimum wage in Decree No. 74/2024/ND-CP is determined by region and linked to district-level administrative boundaries. Meanwhile, from July 1, 2025, after restructuring administrative units nationwide, the areas applying the minimum wage have been reviewed and adjusted by the Government to be linked to new commune-level administrative units.

However, because this is a policy that has a wide impact on many subjects, including businesses and workers, 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.

Furthermore, on July 25, 2025, the National Wage Council issued report No. 009/BC-HDTLQG to the Government recommending an average increase of 7.2% in the minimum wage, effective from January 1, 2026.

Therefore, it is necessary to develop a Decree regulating the minimum wage to be applied in 2026. The main content of the draft Decree stipulates adjusting the minimum wage to increase by 7.2% compared to the current level to be applied from January 1, 2026 (coinciding with the plan that the National Wage Council unanimously recommended to the Government).

According to the draft Decree, the minimum monthly wages in 4 regions include: 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 - VND 350,000 (equivalent to an average rate of 7.2%) compared to the current minimum wage.

According to the Ministry of Home Affairs, 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 workers. This adjustment shares and harmonizes the interests of workers and businesses, paying attention to improving the lives of workers and ensuring the maintenance and development of production and business of enterprises.

The draft also stipulates minimum hourly wages in four 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.

Regarding the applicable area, the draft inherits the list in Decree No. 128/2025/ND-CP but has been adjusted and updated according to the requests of localities after the arrangement of administrative units.

Specifically: Changing the name of Hoang Van Thu ward (Lang Son) to Ky Lua ward; adjusting many areas from region II to region I in Hai Phong; from region III to region II in Nghe An, Quang Tri, Khanh Hoa; from region IV to region III in Quang Tri, Khanh Hoa; adjusting from region I to region IV for some communes in Quang Ninh province; adjusting from region III to region IV for some communes in Quang Tri province.

The adjustment of local regions aims to create a reasonable balance in labor prices between neighboring localities, because these 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, most countries choose the time to adjust the minimum wage to coincide with the start of the fiscal year to facilitate business planning of enterprises.

In Vietnam, from 2000 to now, the Government has adjusted the minimum wage 20 times in general, of which 15/18 times were adjusted on January 1. The other adjustments on January 1 every year are associated with unusual fluctuations (the current minimum wage is applied from July 1, 2024, this adjustment time is set in the economic and social context after going through the most difficult time of the COVID-19 pandemic and starting to move to a state of good recovery and many positive aspects).

Thu Giang

Source: https://baochinhphu.vn/xay-dung-nghi-dinh-moi-ve-tang-luong-toi-thieu-ap-dung-tu-nam-2026-102250929102332148.htm