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Vietnamese businesses make “allowances” for creative accountancy
All businesses want to keep labour costs low while recruiting the most qualified staff – that’s why more and more are fiddling wages.
For H, a Human Resource Manager, paying staff has become increasingly creative.
She explains: “The company payroll shows an officer, has a fixed salary of two million dong a month. However, their real income is five million dong. The extra three million dong is referred to as ‘allowance’.”
A labour expert confirmed this method has been applied by many other companies try to minimise costs. Under current regulations, social insurance payments are based on basic salaries.
Businesses say they are just bending the laws – not breaking them. They say it benefits them and their workers.
Dr. Le Quan from the Trade University says businesses are not technically breaking the law.
The situation is also defended by Dr. Do Ngan Binh, Lecturer of the Hanoi Law University who stressed enterprises should learn to flexibly apply the current regulations in order to bring optimum benefits to companies.
Binh said that flexible salary schemes are a key factor in helping businesses attract talent.
“If all businesses apply the wage salary stipulated by the state, it would be a uniform salary.”
Meanwhile, Quan warns that in the long term, when labour laws are tightened labourers will not accept current practices and will, instead, demand transparency.
By that time, he said, businesses will need to play fair and get ready to spend more money on social insurance.
vietnamnet, vneconomy
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