What is the purpose and responsibility of building a payroll scale? What documents make up a payroll scale application? How should businesses construct their payroll scales? Read the article below for a complete answer.
Guide to building a compliant payroll scale
PURPOSE AND RESPONSIBILITY OF ENTERPRISES WHEN BUILDING A PAYROLL SCALE
Under Article 93 of the Labor Code, which governs the development of wage scales, payrolls, and labor regulations, employers are required to establish wage scales, payrolls, and labor regulations. These serve as the basis for recruiting and managing employees, agreeing on the salary levels stated in labor contracts, and paying salaries accordingly.
Note: Enterprises with fewer than 10 employees are exempt from the requirement to submit salary scales, payrolls, and labor regulations to the state labor management agency at the district level where the enterprise’s production and business activities are located.
PROCEDURES FOR REGISTERING ENTERPRISE SALARY SCALES AND PAYROLLS
Payroll scale registration procedures
- Order of implementation:
Step 1: The enterprise builds its own salary scale and payroll in accordance with government regulations and submits the payroll scale to the district-level Department of Labor, War Invalids and Social Affairs.
Step 2: The district Department of Labor, War Invalids and Social Affairs receives the registered salary scale and payroll. If the Department finds that the enterprise’s salary scale or payroll violates the principles prescribed by the government, it will notify the enterprise of any errors so they can be amended and supplemented in accordance with regulations.
- Method of submission: Submit the dossier directly or by post to the Department of Labor, War Invalids and Social Affairs.
- Composition of the dossier: Salary scale, payroll, and labor regulations of the enterprise, prepared in accordance with regulations.
- Subject to the requirement: Employers with 10 or more employees in the enterprise.
- Handling agency: District-level Department of Labor, War Invalids and Social Affairs.
- Legal basis
– Pursuant to the 2012 Labor Code;
– Pursuant to Government Decree No. 121/2018/ND-CP, which amends and supplements Government Decree No. 49/2013/ND-CP detailing the implementation of a number of provisions of the 2012 Labor Code.
SELF-BUILT ENTERPRISE PAYROLL SCALE SYSTEM
1. Official dispatch requesting registration of the salary scale and payroll system (specify address and contact person’s phone number).
2. The enterprise’s salary scale and payroll system, either newly built or amended and supplemented from the existing salary scale.
3. The standard table applicable to each position or group of positions, professions, and jobs in the salary scale and payroll (specifying the standards and requirements for professional qualifications, IT skills, foreign languages, and experience required for each position in the company).
4. Decision promulgating the salary scale and payroll system applicable within the enterprise.
5. Opinion of the local trade union executive committee or the provisional executive committee (if no trade union exists, all employees in the enterprise must be consulted).
=> Place of submission: District Department of Labor, War Invalids and Social Affairs.
Note: When building a payroll system, enterprises must carefully review and comply with the following documents:
– Government Decree No. 90/2019/ND-CP stipulates the 2020 regional minimum wage applicable to enterprises and organizations for employees working under labor contracts. For details, please refer to: The Regional Minimum Wage in 2020.
– The salary scale and payroll must include a sufficient number of levels, and the gap between salary levels must be designed to encourage employees to improve their professional qualifications, gain experience, and develop their talents. The difference between two adjacent levels must be at least 5%.
– Before registering the payroll scale system, enterprises must complete the labor-use registration procedures at the district-level Department of Labor, War Invalids and Social Affairs. Submit the declaration together with the enterprise’s payroll scale.
REFERENCE PAYROLL SCALE TEMPLATE
| Unit Name: Co., Ltd. | SOCIALIST REPUBLIC OF VIETNAM |
| Address: | Independence – Freedom – Happiness |
| Tax code: | …, day … month … 2020 |
SALARY SCALE AND PAYROLL SYSTEM
I/- MINIMUM WAGE:
Current minimum wage in the enterprise’s region: VND 4,800,000/month.
II/- SALARY SCALE SYSTEM:
Unit of calculation: Vietnamese Dong
| SALARY LEVEL | |||||||
| I | II | III | IV | V | VI | VII | |
| 1. Leadership team | |||||||
| Salary | 9,068,286 | 9,521,700 | 9,997,785 | 10,497,675 | 11,022,558 | 11,573,686 | 12,152,370 |
| 2. Management team | |||||||
| Salary | 7,084,598 | 7,438,828 | 7,810,770 | 8,201,308 | 8,61,374 | 9,041,942 | 9,494,039 |
| 3. Professional title group | |||||||
| Salary | 5,855,040 | 6,147,792 | 6,455,182 | 6,777,941 | 7,116,838 | 7,472,680 | 7,846,314 |
| 4. Technical staff group | |||||||
| Salary | 5,136,000 | 5,392,800 | 5,662,440 | 5,945,562 | 6,242,840 | 6,554,982 | 6,882,731 |
| 5. Office and general staff | |||||||
| Salary | 4,800,000 | 5,040,,000 | 5,292,000 | 5,556,600 | 5,834,430 | 6,126,152 | 6,432,459 |
…, day … month … 2020
Director
(Signature and seal)
| This payroll scale is built based on the following principles: Principle 1: The regional minimum wage is the lowest level. |
| Principle 2: Adjacent salary levels for workers must be at least 5% apart. |
| Principle 3: Trained jobs (including formal schooling or in-house company training) must be paid at least 7% higher. |
| Principle 4: Division of labor. |
Through this article, you now know the steps to register a payroll scale in line with the latest 2020 regulations. If you would like to learn more about other regulations, you can see more here for additional information.
