It’s not just employees who pay close attention to regulations concerning salary, bonuses, and employee benefits at their current or prospective workplaces. Employers, too, place great emphasis on developing comprehensive compensation and benefits structures to attract and retain top talent.
If you’re curious about real-world salary, bonus, and benefits packages across different industries, don’t miss the following article.
What Do Salary, Bonus & Employee Benefits Really Mean?
What is salary and bonus?
While often mentioned together, “salary” and “bonus” carry distinct meanings when analyzed individually. When considering a job opportunity, salary is typically the first factor an employee evaluates — it’s the amount agreed upon by the employer to be paid for performing the assigned work.
According to Article 90 of the 2019 Labor Code of Vietnam, salary refers to the amount an employer pays to an employee for performing work as required. This amount corresponds to the nature of the job and position, and must not fall below the regional minimum wage stipulated under Decree No. 74/2024/NĐ-CP.
A bonus, on the other hand, is an additional payment intended to encourage and reward employees for good performance. Bonuses are provided at the employer’s discretion, based on internal policies, mutual agreements, or the company’s business performance. Bonuses may be paid separately or as a supplement to the base salary, and can include other incentive payments.
What Are Employee Benefits?
In addition to salary, employee benefits are the next most important factor employees consider. These are non-compulsory payments or perks provided depending on the company’s business performance and internal policies.
We believe that a well-structured employee benefits program plays a crucial role in attracting and retaining talent. Benefits may be provided in the form of direct cash allowances or non-monetary support such as healthcare, mental wellness programs, or long-term development opportunities. These initiatives demonstrate the employer’s commitment to the overall well-being and sustainable growth of their workforce.
Mandatory Salary, Bonus, and Benefits
Similar to labor regulations in other countries, employees in Vietnam are entitled to certain statutory wages and benefits as stipulated under the Labor Code and relevant Decrees and Circulars.
Accordingly, employees must be paid at least the regional minimum wage, which ranges from VND 3,450,000 to VND 4,960,000 per month, depending on the designated region. These minimum wage levels are divided into four regions as specified in Decree No. 74/2024/NĐ-CP, effective from July 1, 2024.
In addition, when employees work overtime, they are entitled to receive overtime pay in accordance with the extra hours worked. Specifically:
- On normal working days, employees must be paid at least 150% of their standard hourly wage for overtime hours.
- On weekly rest days, the rate increases to at least 200% of the standard hourly wage.
- On public holidays and paid leave days, employees must be paid at least 300% of the standard hourly wage for overtime, excluding the regular wage for the holiday itself.
Mandatory regulations on salary and bonus help businesses establish a clear payroll projection for their operations. In addition, employers must ensure the participation in compulsory social insurance for their employees — this is considered a highly prioritized employee benefit.
5 Benefit Schemes Covered by Social Insurance:
- Sickness
- Maternity
- Healthcare
- Occupational accidents and occupational diseases
- Survivorship
- Retirement
By contributing to compulsory social insurance, employees are entitled to benefits such as access to medical care and entitlements under health insurance and unemployment insurance when necessary.
Suggested Employee Benefits to Retain Talent
Depending on internal policies, companies may provide various bonus and benefit packages tailored to their workforce. To boost employee morale and productivity, businesses can consider implementing one or more of the following benefits:
Life Insurance
Providing life insurance demonstrates a company’s genuine care for employee well-being. It significantly enhances employer branding in the eyes of employees. Today, many providers offer cost-effective corporate insurance packages — companies may consider plans from Bao Viet Insurance, Prudential, Bao Minh, and others.
Training and Skills Development Support
Investing in employee development is key. Many companies cover part or all of the costs for professional training programs, with reasonable conditions that encourage employees to remain committed and contribute to the business after completing their training.
Company Retreats and Team-Building Activities
Team-building and company trips are essential to fostering internal bonds. A balanced mix of work and play helps create a cohesive workforce. A strong team leads to a resilient organization — which is why this benefit is often prioritized in corporate budgets.
KPI-Based Performance Bonuses
Setting Key Performance Indicators (KPIs) allows both employees and employers to align their goals. This system promotes a balanced and fair approach — as the business grows and profits increase, employees are rewarded appropriately for their contributions and performance.
Gifts and Special Occasion Policies (Holidays, Tet, Birthdays)
These occasions provide an opportunity for the company to show care and appreciation for each individual. Sharing joyful moments fosters a strong emotional bond and enhances team spirit within the organization.
Additional Allowances and Support
Enterprises may offer monthly allowances to support employees’ daily needs, such as lunch subsidies, transportation/fuel allowances, mobile phone expenses, uniforms, and more. These contributions help reduce employees’ personal costs and reinforce a supportive working environment.
The Importance of Salary, Bonus, and Employee Benefits
For Employees: A fair and well-structured salary and bonus system encourages long-term commitment. When employees feel financially secure and appreciated, they are more motivated to contribute their full potential, leading to higher work efficiency and job satisfaction.
For Employers: A transparent and competitive compensation strategy enhances the company’s employer brand, improves talent retention, and attracts high-quality human resources — all of which are essential for sustainable business growth.
In summary, businesses must invest in building a clear and well-balanced salary, bonus, and benefits framework. Doing so not only ensures workforce stability and development but also contributes significantly to operational efficiency and overall success.
