MINIMUM WAGE LEVELS IN VIETNAM FROM JANUARY 1, 2026

The minimum wage is an important tool of the State to protect the basic income of employees, ensure a minimum standard of living, and maintain balance in labor relations within the economy. In the context of rising living costs and the need to adjust wage policies, the Government has issued Decree No. 293/2025/NĐ-CP, which sets out new minimum wage levels effective from January 1, 2026. This adjustment not only directly impacts the income of millions of workers but also brings significant changes to the cost structure of enterprises.

1. Minimum wage by region applicable from January 1, 2026

Under the new regulations, the minimum wage continues to be divided into four regions based on the socio-economic conditions of each area. Specifically:

Monthly minimum wage (from January 1, 2026)

Hourly minimum wage (from January 1, 2026)

Compared to 2025, the minimum wage increases by approximately VND 250,000 – 350,000 per month, equivalent to an average nationwide increase of about 7%.

2. Significance and impacts of the minimum wage increase

For employees

· Increases basic income, helping improve living conditions amid rising living expenses.

· The hourly minimum wage provides better protection for part-time, seasonal, or flexible workers.

· Higher wages lead to corresponding increases in social insurance, health insurance, and welfare benefits.

For enterprises

· Businesses must review and update labor contracts, payroll systems, and wage scales to comply with the new rates.

· Labor costs may rise, especially for companies employing many unskilled or industrial-zone workers.

· However, the adjustment helps businesses maintain a stable workforce and reduce labor shortages, thus improving competitiveness.

For the labor market

· Creates a new wage benchmark, helping protect workers amid fluctuating prices.

· Encourages enterprises to improve productivity to offset rising costs.

· Contributes to greater transparency in hourly wage mechanisms in line with flexible labor trends.

3. Notes when applying the minimum wage from January 1, 2026

· The minimum wage applies only to the lowest level paid to employees who have not undergone training.

· Wages for employees performing work or positions requiring training must be at least 7% higher than the minimum wage.

· Wages for employees working in heavy, hazardous, or dangerous conditions must be at least 5% higher.

· Wages for employees working in extremely heavy, hazardous, or dangerous conditions must be at least 7% higher than wages for equivalent positions performed under normal conditions.

· The minimum wage is the basis for adjusting mandatory social insurance contributions, so enterprises must update accordingly.

4. Conclusion

The increase in minimum wage levels from January 1, 2026 is a necessary adjustment to protect workers’ living standards while aligning with the economic recovery and growth context. Although it imposes certain cost pressures on businesses, this policy contributes to balancing labor relations, enhancing welfare, and fostering a more sustainable labor market. Understanding and properly applying the regulations will help enterprises comply with the law and build a stable and harmonious working environment.