Compensation management

1. Submitted to : Dr. Meha Joshi Submitted by : Nisha Chauhan
Assistant Professor 2K18/MBA/012

2. Introduction
1. Vietnam is a Southeast Asian country on the South
China Sea.
2. Capital – Hanoi
3. Population - 96,794,383
4. Currency – Dong
5. Official language - Vietnamese
6. Area - 310,070 Km2 (119,719 sq. miles)
7. GDP (IMF) : $260.30 billion
8. GDP Per Capita : $2,698.48
9. 2019 Population Rank : 15th

3. Amazing Facts
1. Vietnam exported 348,000 tons of cashew
nuts and 180,000 tons of black peppers in
2016.
2. Vietnam is the second largest consumer of
dog meat.
3. Vietnam remains one of the world’s
largest motorbike markets.
4. Car is considered a luxury property of
wealthy people because car tax in
Vietnam is about 200-300%.
5. Vietnam has a literacy level of 97.3%

4. Amazing Facts
1. No legal drinking age in Vietnam, drink it as long as you can get the
alcohol.
2. Third-largest beer consumer in Asia.
3. Vietnam is a gay friendly destination.
4. World’s 3rd largest rice exporter.
5. Vietnam is the best place for coffee lovers
6. Low Ecological footprint
7. Vietnam is ranked 5th happiest nation in the world
8. The world’s second largest caves, the Son Doong caves are situated in
Vietnam.
9. Vietnam is the world’s leading exporter of cashew nuts and black pepper

5. Vietnam Demographics Profile 2018
1. Age structure :
0-14 years : 23.55% (male 11,909,326/female 10,735,324)
15-24 years : 16.23% (male 8,098,019 /female 7,509,021)
25-54 years : 45.56% (male 22,087,095/female 21,719,615)
55-64 years : 8.55% (male 3,798,928 /female 4,419,837)
65 years and over : 6.12% (male 2,281,923 /female 3,601,075)
2. Median age:
Total : 30.5 years
Male : 29.4 years
Female: 31.7 years
3. Life expectancy at birth:
Total population : 73.7 years

6. Labour laws in Vietnam
1. Labor Code 2012
2. Law on Trade Unions 2012
3. Employment Law 2013
4. Social Insurance Law 2014
5. Health Insurance Law 2014
6. Law on Gender Equality 2006
7. Law on Occupational Safety and Health 2015
8. Law on Persons with Disabilities 2010
9. Others

7. Work Place Culture and People in Vietnam
• Religion : Buddhism and Christianity are the two most popular religions
in Vietnam. However, the majority of the population do not follow any
religion, they just worship their ancestors.
• Working : Vietnamese employees are quite punctual, especially in
business meetings.
• Gender discrimination is usually not popular in the workplace.
• Vietnamese employees usually need to build personal trust with others
outside of the office in order to increase their teamwork and
collaboration.
• Dressing: Vietnamese people dress more casually than Western people.

8. Working Hours
• Usual working hours are from 7:30 a.m. until 4:30 p.m.
• At least a one-hour break for lunch.
• People have the right to one free day a week, and an additional
12 days of vacation during one year.
• By law, the maximum work hours permitted is 48 hours per week.

9. Wages
• Payment

10. • Employees who work extra hours are also paid for those extra hours based on
their current hourly wages, as immediately below.

11. • The monthly minimum wage rates in Vietnam, updated in January 2019, are as immediately
below.

12. Bonus
• While there are no specific guidelines or regulations regarding the
bonus, it is customary to pay wages for the 13th month under the
name of "13thmonth salary" or the like. When previously paid
bonuses or the like are to be restricted or confiscated, it should be
noted that the company is required to consult with the trade union.
• Such "13thmonth salary" is commonly paid around Tet New Year
(Lunar New Year), so it is also called as "Tet Bonus".

13. Other (general holidays, etc.)
1. Weekly holiday, annual leave:
• Workers are given a weekly holiday of 1 day per week.
• For workers who have worked for more than 12 months, normally 12
days are granted as annual leave, and an additional day of annual
leave is granted every 5 years of service.
2. Special leave for weddings and funerals

14. Maternity/Paternity Leave
• Female employees
1. The mother is entitled to six months of maternity leave.
2. If she gives birth to more than one child at a time, she can take one additional
month for each additional child.
3. If a woman is in her third trimester of pregnancy, she is not permitted to work at
night, work overtime or take business trips.
4. A female employee can’t be subject to labour discipline while pregnant, during
maternity leave or while nursing a child under 12 months old.
5. Female workers must receive 100 percent of their average salary during their six-
month maternity leave.
6. Female employee who has a child less than twelve months old is entitled to sixty
minutes per working day to take care of their baby.

15. • Male employees
1. Males employees paying social insurance will be allowed to take paternity leave in
the first 30 days from the day the baby is born.
2. paid leave of five days for a normal delivery and seven days if the baby is born by
surgery.
3. For twin births, the leave allowance is increased to 10 to 14 days.
4. For multiple births, three working days off are permitted for each baby after the
third one.
5. the baby’s mother dies or faces health risks, the male employee will be entitled
leave until the child reaches six months of age.
6. the male employee is entitled to a lump sum of US$128 (VND 2,980,000) per child,
equivalent to double the basic salary.

16. Social Security System in Vietnam
• Vietnam has three obligatory social security systems:
1. Social insurance
2. Health insurance
3. Unemployment insurance

17. Sick Pay
The number of leave days depends on how long the employee has been
paying for social insurance. If less than 15 years, employees can have at most
30 days of sick leave each year. If over 30 years, there can be 60 days of sick
leave each year. The sick pay is 75% of the salary of the previous month.
Old-age Allowance
Female employees above 55 years old or male employees above 60 years old
are entitled to apply for old-age allowance, if they have been paying for
social insurance for more than 20 years. Employees who do not can apply to
get a lower old-age allowance if they meet secondary requirements.

18. Allowance for Family Dependents of the Dead
• After the employee’s death, the allowance for family dependents of the
dead will be borne by the social security fund regardless of what the
employees paid for social insurance and any withdrawals from the
monthly old-age allowance or work-related injury/occupational disease
allowance. The amount is ten times the standard minimum salary. There
are also special allowances for one-time disbursements to the family of
the dead.

19. Work-related Injury Allowance and
Occupational Disease Allowance
• If an employee’s working ability declines more than 5%, he can get
work-related injury allowance or disease allowance.
• If his working ability declines by 5 to 30%, he is entitled to a one-time
allowance.
• If his working ability declines for more than 30% when he retires, he will
receive more allowance.
• If an employee dies from work-related injury or disease, his family
receives a onetime allowance of 36 months of standard minimum salary

20. Allowances and Benefits
Employee may be entitled to several kinds of allowances and monetary or non-
monetary benefits designed to retain staff.
Taxable benefits include:
• Housing rent, Payments for power, water, and associated services for employees that
amount to more than 15 percent of their total taxable income
• Transportation allowances
• Premiums for life insurance
• Health care services
• Entertainment fees
• Sports/athletics fees or membership fees to golf clubs, tennis courts, and other
exclusive clubs.