Building a salary scale structure

Basically, most businesses need to establish a salary scale, salary table, and publicly disclose them at the workplace. Therefore, businesses need to clearly understand the principles and procedures to create the most appropriate salary scale and table for their company. In this article, we discuss the principles and procedures for building the latest salary scale and table.

Legal regulations

• Labor Code 2019

• Decree 38/2022/ND-CP

Principles for building the salary scale and table:

• The minimum wage is the lowest wage paid to workers, and this wage must not be lower than the regional minimum wage and should be adjusted based on the minimum living standards of workers.

• Businesses should refer to the company's bonus regulations and organizational structure to determine the levels in the salary scale, including the coefficients and wage multiples on the salary table.

• Businesses must ensure fairness when constructing the salary scale and table: equality and non-discrimination based on gender, ethnicity, skin color, social status, marital status, beliefs, religion, HIV status, disability, union membership, etc.

• The salary scale and table must be reviewed and amended periodically.

Procedure for building the salary scale and table:

Step 1: Update the regional minimum wage

From July 1, 2024, the regional minimum wage for the simplest job or position under normal conditions (e.g., production workers not performing heavy, hazardous tasks) will continue to follow the regulations in Decree 74/2024/ND-CP as follows:

• Step 2: Statist the positions and specialized tasks in the company

  Depending on the position and different specialized tasks, the salary for employees will also vary. In addition, when calculating salaries, businesses also need to consider other factors such as years of experience, work ability, and professional training...

• Step 3: Design corresponding salary levels based on the principles for constructing the salary scale and table.

  Once the position groups and professional qualifications are established, the business can calculate the corresponding salary, bonuses, and allowances.

• Step 4: Consult with the trade union

  After the salary table has been built, the business needs to consult with and get the opinion of the organization representing the workers at the workplace. The opinion of the workers' representative organization (approval/additional comments, etc.) must be documented in writing with the signatures of the representatives.

• Step 5: Submit the salary scale and table to the Department of Labor, Invalids, and Social Affairs

  The salary scale and table must be publicly announced at the workplace before being implemented so that employees are well-informed.

  The above is our consultation on the principles and procedures for constructing the salary scale and table. If you need to find a consulting firm with experience in business matters, please contact us.