Regional Minimum Wage Regulations 2025 in Vietnam

Key takeaways

• Regional minimum wage regulations for 2025 range from $135-$195 per month under Decree 74/2024/ND-CP, creating mandatory legal framework for enterprises
• Labor pressure for wage increases and the 8% GDP growth target for 2025 signal a new adjustment cycle, requiring businesses to prepare scenarios early
• Simply complying with minimum wage requirements isn’t enough to retain talent in today’s competitive labor market
• Competitive compensation policies serve as strategic investment tools that boost productivity, reduce turnover, and create sustainable advantages
• Reviewing and developing wage adjustment scenarios now is key to maintaining competitive edge

Regional minimum wage regulations establish the lowest wages paid to workers performing the simplest jobs under normal working conditions, aimed at ensuring minimum living standards for workers and their families. This regulation is clearly stated in Article 91 of the 2019 Labor Code and serves as the basis for the Government to adjust state-mandated minimum wage levels according to each period, aligned with socio-economic development conditions.

Current regulations minimum wage 2025 in Vietnam

As the economy undergoes major transformation, accurately understanding current regulations and forecasting future trends becomes crucial for businesses to shape long-term human resource strategies.

Under Decree 74/2024/ND-CP, 2025 regional minimum wage rates show clear differentiation by geographic region. Region I at $195 per month covers major cities and the most developed areas. Region II applies $173 per month for provinces with moderate development levels. Minimum wage for region 3 sets $152 per month for developing areas. Region IV applies the lowest rate of $135 per month for rural and mountainous regions.

The basis for these regulations stems from large-scale surveys on workers’ living needs and actual economic conditions. Notably, the national GDP growth target for 2025 is set at 8%, creating positive pressure for adjusting worker income increases.

Additionally, authorities are reviewing administrative territorial divisions. This process may lead to wage level changes in some areas in the near future, especially in areas undergoing major economic structural transformation.

A factor that can’t be ignored is the growing wage increase expectations from workers. This not only creates pressure but also opens important opportunities for businesses to build competitive advantages in attracting and retaining high-quality talent, especially in sectors like manufacturing and production.

What businesses need to prepare for this change?

Success in managing compensation policies lies not just in regulatory compliance but in the ability to turn challenges into sustainable growth opportunities.

Ensuring compliance with current regulations

The first and most important step is for businesses to conduct comprehensive reviews of current salary systems. This ensures no wage levels fall below the requirements of Decree 74/2024/ND-CP for each specific region where the business operates.

Special attention must be paid to wage conversion calculations for various payment forms. Whether paying by hour, day, week, or by product, all must ensure that monthly conversions don’t fall below minimum levels. This is why professional payroll systems must be designed accurately and transparently.

For businesses with branches in multiple regions, applying the correct minimum wages by location is mandatory. Each branch must follow regulations for the area where that branch is headquartered, creating certain management complexity but also opening opportunities to optimize personnel costs. To ensure full regulatory compliance, businesses need rigorous management systems.

Strategic considerations for wage increases

Strategic vision requires leaders to look beyond minimum compliance. A competitive compensation policy delivers practical and sustainable business benefits.

First, attractive compensation policies help stabilize human resources in a volatile labor market. This stability not only reduces recruitment and training costs but also maintains accumulated knowledge and experience within the organization. Lower turnover rates mean higher work productivity and more positive work environments.

Market reality shows that businesses with heavy investments in technology and labor productivity improvements are fully capable of adjusting wage increases while maintaining profitability. Moreover, this creates a positive cycle: higher wages attract better talent, productivity increases, revenue grows, thereby creating conditions to continue investing in human resources along with other mandatory benefits.

In today’s fiercely competitive environment, sustainable competitive advantages often come from human resource quality. Businesses with fair and attractive compensation policies will easily attract excellent candidates while retaining experienced and capable personnel.

As the economy develops strongly and worker expectations continue rising, simply complying with regional minimum wage regulations is no longer sufficient for businesses to maintain competitive position. Leaders with strategic vision need to view compensation policy as an important investment tool in human resources, rather than just considering it a mandatory expense. Start evaluating your compensation structure now, develop adjustment scenarios, and analyze impacts on business effectiveness to avoid being passive before upcoming changes. To have effective payroll compliance principles, businesses need to invest in professional management systems starting now.