Effective wage negotiation - key to driving growth

For the last 20 years, Viet Nam Trade Union has made significant innovations towards fulfilling its basic roles and functions. (Photo: Thanh Vu/VNA)

Hanoi (VNA) - The challenges and missions change over time. But one primary mission of trade unions of any country is always the same. It is protecting and representing the interests and rights of workers and their families.

Workers are consumers as well as producers, ILO Viet Nam Director Chang-Hee Lee emphasizes when sharing his thoughts on today’s roles of Viet Nam Trade Union (VGCL) on the occasion of May Day.

- What are the trade unions’ impacts in developing national wage policies?

ILO Viet Nam Director Chang-Hee Lee: Wage policy is the area where the trade union has done really a good job in representing workers’ interests in minimum wage fixing.

In 2013, the National Wage Council was established, based on the 2012 Labour Code. It brought really profound changes.

Before 2013, minimum wages were fixed by the Government alone without true engagement of VGCL and VCCI and other business voices.

ILO Viet Nam Director, Chang-Hee Lee (Photo: Vietnam+)

Since 2013, minimum wages were fixed through consultation and sometimes, negotiation among three parties – MOLISA, VGCL and VCCI and other business associations, representing the voices of workers and employers, respectively. At National Wage Council meetings, VGCL always insists that the Government and other parties should aim to improve the livelihood of workers and their families when fixing minimum wage. They always advocate for workers’ voice in the minimum wage fixing process.

- How about collective bargaining on wages at grassroots level?

ILO Viet Nam Director Chang-Hee Lee: Regarding collective bargaining agreement, compared to 10 years ago, I see improvements. There are more enterprises with collective bargaining agreements, and more collective agreements with provisions higher than minimum legal conditions. But one thing is missed out in most collective agreements – wage.

I would like to bring your attention first to Resolution No.27 of the Party Central Committee on wage policies. It is an extremely important document which should guide industrial relations actors in deciding wages and other working conditions.

There are three important things in the Resolution. First, it says that the State should not intervene in enterprise-level wage fixing process. Second, it recognizes importance of minimum wage, but also recognizes its limitation – that minimum wages can only protect the most vulnerable workers in the labour market. It cannot be used to determine actual wages of every worker. Third, the Resolution encourages trade union and employers to fix actual wages through collective bargaining.

The Resolution sets clear guidance on how wages should be fixed, and this is fully aligned with the ILO’s international labour standards. Unfortunately, this is not happening yet in most enterprises. Some fringe benefits such as lunch allowance or 13th monty bonus may be included in the collective agreement, but not monthly wages or salaries. In all other countries, wages are the most important item for collective bargaining.

What do you think about the roles of VGCL in protecting rights and interests of workers at enterprises today?

ILO Viet Nam Director Chang-Hee Lee: VGCL has 92 years of history. Established in 1929, it has a proud history of defending the interests of Vietnamese people and Vietnamese workers by fighting against foreign aggression for independence, and joining force to unifying the country, and building the new economy.

I believe the Trade Union in Viet Nam has done their best to represent and protect the rights and interests of workers. Sometimes it was given less emphasis as there were more overriding concerns of the time, such as fighting for independence or joining force for building the country.

The 2019 Labour Code, which came into effect on 1 January 2021, has made important improvements on these situations. There are much tougher regulations against unfair labour practices. In addition, the 2019 Labour Code does not allow senior managers to join union and there should be separation between union and management.

I hope trade unions will use these legal provisions so that they can protect workers rights more effectively.
- Thank you!