Prolong pilot of labor and salary management in some state-owned enterprises

VCN - The Government issued Decree No. 87/2021/ND-CP on extending the implementation and amending and supplementing a number of articles of Decree No. 20/2020/ND-CP dated February 17, 2020 of the Government on piloting labor, salary and bonus management for a number of state-owned economic groups and corporations.
Illustration image. Source: Internet
Illustration image. Source: Internet

Accordingly, it will prolong the implementation of regulations on salary and bonus of employees and the Executive Board; salary, compensation and bonuses of members of the Members' Council, Board of Directors, Head of the Supervisory Board and Supervisors, instead of being implemented only until the end of December 31, 2020.

Decree No. 87/2021/ND-CP stating that the provisions of this Decree will be implemented from January 1, 2021 until the Government promulgates a new Decree regulating the management of labor, salary, compensation, bonus in State-owned enterprises following Resolution No. 27-NQ/TW dated May 21, 2018 of the Seventh Plenary Session of the 12th Central Committee on reforming salary policy for cadres, civil servants, public employees, employees, armed forces and employees in enterprises take effect.

The Decree added: Based on the salary fund, the company decides to use the entire salary fund to pay salaries in the year or to deduct a part to establish a reserve fund to supplement the salary fund of the following year. However, it must not exceed 17% of the salary fund.

Also according to the Decree, in the case of companies that are experiencing a decrease in labor productivity, profits and return on equity (ROE) mainly due to the direct impact of objective factors, when determining the salary fund of employees, the Executive Board should base on the criteria for calculating the flat unit price and the salary and remuneration levels of members of the Members' Council, the Board of Directors, the Head of the Supervisory Board, and the Supervisors as prescribed in Clause 1, 3 Article 8 and Clause 2 Article 12, Article 13 of Decree No. 20/2020/ND-CP dated February 17, 2020 of the Government where the average salary of the Executive Board and employees on the list of paying salary is lower than 65% of the average salary (including safety bonus, if any) of those employees in 2019.

If the salary and remuneration of members of the Members' Council, Board of Directors, Head of the Supervisory Board, and Supervisors are lower than 65% of the actual salary and remuneration of each respective title in 2019, the company should determine and report to the owner's representative agency for consideration and decision on the average salary of the Executive Board and employees up to 65% higher than the average salary (including safety bonus) actual number of those employees in 2019.

When determining salary and remuneration based on the above provisions, the company must complete the profit plan (after excluding objective factors) assigned by the agency representing the owner. The average salary of employees and the Executive Board is not lower than the salary determined following the salary scale and salary table developed and promulgated by the company in accordance with the provisions of Article 6 of Decree No. 20/2020/ND- CP dated February 17, 2020 of the Government.

The Head of the Supervisory Board, the Supervisors of the company continue to apply the salary, remuneration and bonus following the provisions of Decree No. 20/2020/ND-CP dated February 17, 2020 of the Government. It should not apply regulations on salary, remuneration and bonus in Clause 2, Article 8 of the Government's Decree No. 47/2021/ND-CP dated April 1, 2021 detailing a number of articles of the Enterprise Law until the Government promulgates a new Decree on management of labor, salary, remuneration and bonus in State-owned enterprises takes effect.

By Hương Dịu/Thanh Thuy

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