The micro enterprises “load off” on the salary policy

The administrative burden of micro, small and medium enterprises is often much larger than that of large enterprises. Picture: collection.

More incentives for businesses

From January 1st, 2019, Decree 121/2018/ND-CP will come into effect, which stipulates a number of specific principles on salary scales and payrolls for the enterprises, increases incentives for the enterprises.

Mr. Nguyen Anh Dung, Director of Minh Hieu Construction Consultant Company - an enterprise with only 9 employees, said that the company had regularly built the labor norms in former time, which decided the unit price of employee's salary as well as the unit price of the product and the profit of his enterprise. However, with the new Decree 121 just issued, it was much easier for his enterprise to set up the labor norms, because the norms are much easier to build.

Specifically, in the principle of building the labor norms, the Decree states that the enterprises set up the labor norms as a basis to pay salaries to the employees who receive the salaries by their products, ensuring the labor norms implemented for each step of the work, each stage and the whole producing process of products and services on the basis of organizing labor scientifically, and production reasonably.

The level of labor must be an average level, ensuring that the majority of workers can do without extending the standard working time of the enterprises in accordance with the legal regulations.

In the case of standard work, the actual norms calculated by the production are less 5% or 10% higher than the assigned norms, or the actual norms are 5% higher or 10% lower than the assigned level, the enterprises must adjust the labor norm.

At the same time, the labor norms must be reviewed and evaluated periodically to be amended, supplemented and adjusted accordingly. When building or modifying, supplementing, adjusting the labor norms, the enterprises must refer to the idea of the organization as the representative of labor collective of the enterprises and publicize them at the working places of laborers before implementing, at the same time, send them to the State management agencies in district-level where the enterprise is located.

Light burden for the micro enterprises

Criteria for determining small and medium enterprises are specified in the Government's Decree No. 39/2018/ND-CP of March 11, 2018, detailing a number of articles of the Small and Medium Enterprise Support Law. Accordingly, the micro-enterprises are ones in which the average number of employees participating in social insurance do not exceed 10 persons and the total turnovers of the year do not exceed 3 billion VND, or the total capital sources do not exceed 3 billion VND in the agriculture, forestry, fisheries and industry, and construction sectors. Or the total turnovers of the year do not exceed 10 billion VND in the field of trade and services.

Ms. Bui Minh Anh, Deputy Director of Bac Hung Co, Ltd., said that her company only had a staff of less than 10 people, so it belonged to a micro enterprise without building and registering the labor regulation. However, when building the salary scales and payrolls, they must invite the Labor Union representatives of the district to participate because they did have the labor union organization and they must send to the Labor, War Invalids and Social Affairs Divisions in the district. This is considered a problem for the enterprise, and causing many enterprise embarrassment.

Therefore, one of the other regulations that is expected by the micro enterprises in this Decree is that it has removed difficulties for the enterprises when the regulations for the enterprises using less than 10 employees are exempted from the procedure on sending the salary scales and payrolls and labor norms to the State management agencies in the district where the enterprises' production and / or business establishments are located.

These are considered as the important efforts to facilitate development for the micro enterprises, eliminating unnecessary cumbersome procedures, costing the enterprises.

According to Mr. Dau Anh Tuan, Head of Legal Department, Vietnam Chamber of Commerce and Industry (VCCI), the micro, small and medium enterprises now accounts for 98% of enterprises in Vietnam. In particular, the administrative burden of micro, small and medium enterprises is often larger than the large enterprises. In fact, according to the regulations, the difference between micro and large enterprises when implementing the legal regulations has only a few points, so solutions to reform the administrative procedures will be very necessary.