Vietnam raises penalties for late wage payments

Photo courtesy of Tuoi Tre

Vietnam has introduced tougher penalties for employers who pay wages late, underpay staff or breach compulsory insurance rules. Decree No. 283/2026 covers violations involving labour, social insurance and Vietnamese workers sent abroad under contract.

Late-payment cases involving 301 or more employees can bring fines of VND40 million to VND50 million, equivalent to about US$1,521 to US$1,900. Employers can face the same range for interfering with workers' freedom to decide how their wages are spent or forcing staff to buy goods or services from the employer or a nominated business.

Back pay and interest become compulsory

Businesses paying below the government-set regional minimum wage face penalties ranging from VND20 million to VND75 million, depending on how many employees are underpaid. In addition to the fine, the employer must pay the missing wages and interest.

Interest on late or underpaid wages will use the highest demand-deposit rate publicly announced by state-owned commercial banks when the penalty is imposed. Similar restitution applies when compulsory social, health or unemployment insurance obligations are breached.

Employers evading unemployment insurance contributions face fines equal to 18 to 20 percent of the unpaid amount, capped at VND75 million. Evasion includes declaring an unlawfully low wage as the contribution basis, or failing to pay the registered amount more than 60 days after the final deadline despite official demands.

Minimum wages and workplace transparency

Current monthly regional minimum wages are VND5.31 million in Region I, VND4.73 million in Region II, VND4.14 million in Region III and VND3.7 million in Region IV. The decree also sets fines of VND5 million to VND10 million for failing to establish or publicly display wage scales, payrolls, productivity norms and bonus rules before applying them.

Penalties also cover wage systems introduced without consulting employee representatives, failures to provide required wage statements, and unequal pay. Labour-outsourcing companies can be fined VND10 million to VND100 million for paying outsourced workers less than equally qualified employees doing the same work for the client.

The rules also address failures to provide proper benefits following occupational accidents or diseases, and misleading or incomplete information about labour-outsourcing contracts.

What it means for foreign workers and businesses

Foreign employees working under Vietnamese labour arrangements should retain contracts, wage statements and records of payment dates. The decree provides clearer financial consequences for late payment and underpayment, although individual disputes still need to follow the appropriate labour and legal procedures.

Foreign-owned and foreign-invested employers should review payroll timing, published wage policies and insurance contributions against the new requirements. The rules apply to employer conduct rather than ownership, making accurate records and consistent treatment of local and foreign staff important compliance safeguards.

1 August 2026