Vietnam minimum wage: What expats and employers need to know

The Vietnam minimum wage is updated annually to reflect changes in living costs and economic conditions. terra helps employers and employees understand how the Vietnam minimum wage influences standard labor costs nationwide.

What is minimum wage in Vietnam?

Vietnam’s regional minimum wage is the legally mandated lowest pay that employers must provide to their employees. Defined in the 2019 Labor Code, this wage is a mandatory legal requirement, applied to specific groups to safeguard employees’ rights and ensure employers’ responsibilities, forming the foundation of Vietnam minimum wage regulations. 

Who is eligible for the Vietnam minimum wage??

According to Article 91 of the 2019 Labor Code and Article 2 of Decree 38/2022/ND-CP, the groups subject to the regional minimum wage include:

• Individuals working under labor contracts as prescribed by the Labor Code.
• Enterprises as defined under the Law on Enterprises.
• Agencies, organizations, cooperatives, households, and individuals that hire or employ workers based on mutual agreements.
• Other agencies, organizations, individuals, and relevant entities involved in the implementation of the statutory minimum wage.

These groups are legally required to follow the Vietnam minimum wage standards set under the Labor Code and related decrees.

Vietnam minimum wage by region 2025

Currently, this wage level is applied under Decree 74/2024/ND-CP, effective from July 1, 2024. Below is the detailed table of the current regional minimum wage by month and by hour, reflecting the Vietnam minimum wage structure across four regions.

Learn more: Average salary in Vietnam 2025 by city, industry & job level

Latest updates to the Vietnam minimum wage effective January 1, 2026

On the other hand, from January 1, 2026, the minimum wage for employees will be applied according to Decree 293/2025/ND-CP, replacing Decree 47/2024/ND-CP. This adjustment aims to ensure workers’ living standards while balancing the payment capacity of enterprises, continuing Vietnam minimum wage reforms for 2026.

Below is the detailed table of Vietnam’s 2026 regional minimum wage, by month and by hour:

List of regional administrative units in Vietnam

This table lists all provinces and centrally governed cities, allowing you to quickly identify the applicable minimum wage level for your operating location (effective from January 1, 2026).

While the minimum wage sets the baseline, the average salary in Vietnam provides context for living standards and helps employees plan finances.

Factors that determine Vietnam minimum wage adjustments

According to Clause 3, Article 91, Labor Code 2019, the minimum wage for employees is determined and adjusted based on the following factors, which directly influence Vietnam minimum wage policies.

• The minimum living needs of employees and their families;
• The gap between the minimum wage and prevailing wages in the labor market;
• Changes in the consumer price index and the economy’s growth rate;
• Labor supply and demand conditions;
• Employment and unemployment levels;
• Overall labor productivity;
• The payment capacity of enterprises.

How Vietnam minimum wage rates are applied in payroll calculations

According to Clause 3, Article 3 of Decree No. 38/2022/ND-CP, employers must ensure that the correct minimum wage rate is applied in the following cases, in accordance with Vietnam minimum wage requirements.

• Employers must pay the minimum wage of the region where each branch or unit operates.
• Employers in industrial parks or zones spanning multiple regions must pay the highest regional minimum wage.
• Employers in areas that have been renamed or divided must apply the previous rate until the government issues new regulations.
• Employers in newly established areas or provincial cities must apply the highest applicable regional minimum wage.
• Employers who work in heavy, hazardous, or dangerous conditions must be paid at least 5% more than the standard rate.

These rules ensure consistent and lawful payroll practices under the Vietnam minimum wage framework.

Learn more: What is a Fixed Salary? 

Salary components

An employee’s annual compensation package includes gross salary together with mandatory insurance contributions. After statutory deductions for social, health, and unemployment insurance, the remaining income is subject to Personal Income Tax (PIT).

In addition to base pay, employees may receive bonuses, allowances, overtime pay, and other taxable benefits, which are added to their gross income.

For Vietnamese employees working for multinational enterprises, salaries must be paid in Vietnamese Dong (VND). Foreign employers may determine salary levels in either US dollars (USD) or Vietnamese Dong (VND); however, if salaries are denominated in USD, payments must be converted into VND at the time of payment.

Note: If salaries are set in US dollars (USD), payments and related obligations such as social insurance, personal income tax, and trade union fees must be converted into VND using the official exchange rate issued by the Government of Vietnam.

Overtime pay

Employees in Vietnam are entitled to overtime compensation according to labor laws. The rates depend on the type of workday and time of work:

Note: Employees may work up to 40 overtime hours per month, while employers can arrange up to 300 overtime hours per year. These limits apply to positions requiring specialized skills and industries such as the manufacturing and export of electrical and electronic products.

Performance and earnings-based bonuses for employees

Employers in Vietnam may offer bonuses and incentives throughout the year to reward employee performance and encourage productivity. These bonuses are typically based on business results and internal evaluations.

All bonuses and additional income are subject to Personal Income Tax (PIT) in Vietnam.

13th-month salary

In Vietnam, both domestic and foreign employers commonly provide a 13th-month salary, usually equal to one month’s salary, for employees who have completed at least one year of service. Employees who have worked for less than a year may receive a pro-rated amount based on their actual working period.

Lunar New Year or Tet bonus

Employees often receive a special bonus before the Lunar New Year holiday, commonly referred to as the Tet Bonus. The amount of the Tet Bonus depends on company performance and individual performance, typically ranging from one month’s salary up to one year’s salary.

How to calculate the Vietnam minimum wage for employees

Employees can determine the applicable regional minimum wage for their position by following these steps, based on the Vietnam minimum wage framework.

Identify the correct region

Employees can check their regional minimum wage by referring to the Appendix on regional classifications in Decree No. 74/2024/NĐ-CP. The classification is based on the district, town, or provincial city where the workplace is located, as defined under Vietnam minimum wage regulations.

For example, if the workplace is located in a central district of Hanoi or Ho Chi Minh City, it is likely classified as Region I. If it is located in a suburban district or a province with lower economic conditions, it may fall under Region II, III, or IV.

Determine applicable wage tier

After identifying the applicable region, refer to Article 3 of Decree No. 74/2024/NĐ-CP to determine the corresponding monthly and hourly Vietnam minimum wage rates.

The current rates are listed in the table provided above.

Learn more: Salary After Tax: How to calculate and simplify Payroll in Vietnam

Apply statutory rules to payroll

When an employer pays wages based on the employee’s position or job title, the salary for that position must not be lower than the applicable regional minimum wage.

Allowances, supplements, and other non-fixed payments may be agreed upon between the employer and the employee, but they cannot be used to offset or reduce the main salary below the prescribed minimum wage level, in accordance with Vietnam minimum wage requirements.

Example:

Assume that Company A operates in a Region I area (for example, Hanoi or Ho Chi Minh City). According to Decree No. 293/2025/NĐ-CP, the minimum wage for Region I in 2026 is VND 5,310,000 per month. Company A has developed its own salary scale and structure as follows:

• For the simplest jobs or positions under normal working conditions:
  Position: Office clerk, janitor, or cleaner.
  Salary: The minimum salary for this position in Company A’s salary scale must not be lower than VND 5,310,000 per month.
  
• For jobs or positions under heavy, hazardous, or dangerous conditions:
  Position: Production worker in a noisy environment, chemical handler, or machinery operator.
  Salary: The salary for these positions must be at least 5% higher than that of an equivalent position under normal working conditions (for example, a regular trained technician).
  Calculation:
  Base salary = VND 5,310,000
  → 5,310,000 + (5,310,000 × 5%) = 5,310,000 + 265,500 = VND 5,575,500 per month
  

Note:
These are the mandatory minimum wages that employers must follow when setting salary scales. Actual salaries may be higher based on the employee’s skills, experience, agreements with the employer, and the company’s performance, but they must always comply with Vietnam minimum wage standards.

FAQs about Vietnam Minimum Wage

Here are some frequently asked questions to help you stay compliant with Vietnam’s minimum wage laws:

Is it a violation to pay below the Vietnam minimum wage?

Yes

Detailed Explanation:

According to Article 17 of Decree No. 12/2022/NĐ-CP, paying employees less than the regional minimum wage stipulated by the Government is considered a violation of wage regulations.

• If the violation involves 1 to 10 employees: a fine ranging from VND 20 million to 30 million.
• If the violation involves 11 to 50 employees: a fine ranging from VND 30 million to 50 million.
• If the violation involves 51 employees or more: a fine ranging from VND 50 million to 75 million.
• If the employer is an organization, the fine will be doubled compared to the fine imposed on individuals.

In addition to administrative fines, the employer is required to pay the unpaid wage difference to the employees, plus interest calculated based on the bank deposit interest rate for the delayed payment period.

Note: According to Clause 1, Article 6 of Decree No. 12/2022/NĐ-CP, the above fines apply only to individuals.

If the employer is an organization, the penalty amount will be doubled compared to that imposed on individuals.

Can probation salary be lower than the Vietnam minimum wage?

Yes 

Detailed Explanation

Employers are allowed to offer a lower salary during the probation period; however, it must comply with the legal threshold set by the Labor Code. The probationary salary is agreed upon by both the employer and the employee, but it must not be lower than 85% of the official salary for the same position once the employee is officially hired.

If the official salary for the position is equal to the regional minimum wage, the probationary salary must be at least 85% of that regional minimum wage.

What is the maximum number of working hours allowed in Vietnam?

Under the Labor Code of Vietnam, the standard working time must not exceed 8 hours per day or 48 hours per week, effectively setting a 48-hour weekly cap.

If both parties consent to overtime, employees may work additional hours, but the total overtime is restricted to 12 hours per day, 40 hours per month, and 200 hours per year, depending on the nature of the work and business sector.

How is the Vietnam minimum wage determined annually?

Vietnam typically adjusts its minimum wage rates annually, with changes often taking effect in January. These adjustments are influenced by factors such as regional differences, cost of living, and overall economic conditions.

What employee benefits are tied to the Vietnam minimum wage?

In addition to receiving the minimum wage, employees in Vietnam are entitled to various benefits, including social insurance, health insurance, and other allowances. Employers are legally required to provide these benefits to their workers.

Why is it best to terra Payroll in Vietnam?

Managing payroll in Vietnam can be complicated due to constantly changing Vietnam minimum wage regulations, social insurance contributions, and tax requirements. terra Payroll is designed to simplify these challenges for businesses. Here’s why it is the best choice:

• Compliance and accuracy: Payroll is always aligned with the latest Vietnam minimum wage and legal updates, ensuring correct salary calculations and regulatory compliance.
• Data security compliant with ISO 27001:2022: Confidential employee information is strictly protected.
• 3X faster processing speed: Eliminate the need for dedicated payroll software or a full HR team.
• Payroll automation: Fully automated workflows streamline payroll management, saving time and reducing errors.
• Professional support: Experienced payroll experts are ready to handle complex issues and provide guidance on Vietnam minimum wage and other statutory obligations.

terra Payroll ensures accurate and efficient payroll management in Vietnam, keeping your business and employees satisfied.

Summary

Understanding the regional minimum wage levels and the upcoming 2026 updates is crucial, not only for ensuring legal compliance, but also for helping employers and employees clearly grasp their rights and obligations. terra’s payroll are ready to help you review wage structures, ensuring full compliance with the latest Vietnam minimum wage requirements.