Vietnam’s Regional Minimum Wage Effective from January 1, 2026

Vietnam’s government has officially updated the regional minimum wage for contract-based workers, which will take effect from January 1, 2026. Employers in Vietnam are advised to pay attention to the cost impact of the updated minimum wage.

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On November 10, 2025, Vietnam’s government issued Decree No. 293/2025/ND-CP (“Decree 293”), effective from January 1, 2026, replacing Decree No. 74/2024/ND-CP (“Decree 74”) on the implementation of the regional minimum wage.

Accordingly, the government has raised the regional minimum wage by VND 250,000–350,000 (US$9.5–13.3) per month, equivalent to an average 7.2 percent increase. Along with the new minimum wage levels, Decree 293 also introduces a new list of categorized areas and guides the application of the updated regime.

This article outlines the updated regional minimum wage in Vietnam, effective January 1, 2026, detailing the new wage levels, regional classifications, and guidelines for employers.

Updates to the Vietnam minimum wage from January 1, 2026

How to understand the regional minimum wage in Vietnam

The regional minimum wage in Vietnam represents the lowest wage level and serves as the basis for businesses to negotiate and pay wages to laborers. This amount applies to individuals working under employment contracts as stipulated by the Labor Code, including those working in enterprises, cooperatives, farms, households, individuals, and other Vietnamese organizations that employ staff under contracts, as well as foreign organizations and individuals in Vietnam that employ laborers.

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Vietnam’s minimum wages vary across four different regions, each based on the living standards in those areas. The new organization of local administrative units has significantly changed how regions are categorized.

To guide the implementation of the regional minimum wage in 2026, the Vietnamese government has also issued an updated list of areas applying the new minimum wage levels, attached to Decree 293. Under the new list, Vietnam’s regions are categorized as follows:

• Region 1: This region encompasses the most economically developed and urbanized areas of Vietnam, including its key industrial and business hubs, such as Hanoi, Ho Chi Minh City, Hai Phong, and Da Nang.
• Region 2: This region encompasses areas with substantial industrial and economic development, albeit at a lower intensity than Region I. Most areas of Binh Duong, Dong Nai, and Can Tho belong to this region.
• Region 3: Comprising areas with moderate economic development, this region features emerging industrial and agricultural areas, some of which belong to Hai Duong, Khanh Hoa, and Long An.
• Region 4: This region encompasses the least economically developed areas, often characterized as rural or less industrialized, with a primary focus on agriculture and small-scale industries.

For the detailed list of areas applying minimum wage levels effective from January 1, 2026, please read: Salary and Wages in Vietnam - Vietnam Guide | Doing Business in Vietnam

How to apply the new regional minimum wage?

Step 1: Determine your operational location

The application of regional areas is determined based on the operational location of the employer as follows:

• Employers operating in an area belonging to a specific region must apply the minimum wage prescribed for that area.
• Employers with units or branches operating in areas with different minimum wage levels must apply the minimum wage prescribed for the area where the unit or branch operates.
• Employers operating in industrial parks, export processing zones, high-tech zones, or centralized digital technology zones located across areas with different minimum wage levels shall apply the highest minimum wage among those areas.
• Employers operating in areas that undergo name changes or divisions shall temporarily apply the minimum wage prescribed for the area prior to the name change or division until the Government issues new regulations.
• Employers operating in newly established areas formed from one or more areas with different minimum wage levels shall apply the highest minimum wage among those areas until the Government issues new regulations.

Step 2: Apply the regional minimum wage level by month or hour

Decree 293 clarifies the applications of the monthly and hourly minimum wage in different cases, including:

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Enhancing internal audit and risk management

• The monthly minimum wage serves as the lowest permissible base for negotiating and paying employees who receive monthly wages. Employers must ensure that employees working full regular hours and meeting agreed performance standards are paid no less than the applicable monthly minimum wage; and
• The hourly minimum wage functions as the minimum baseline for employees paid by the hour, ensuring that wages for one hour of work, when performance requirements are met, cannot fall below the prescribed hourly rate.

For employees paid by the week, day, product, or through fixed-task contracts, the converted monthly or hourly wage must not be lower than the statutory monthly or hourly minimum wage. Conversion is based on standard working hours as defined under labor regulations:

• Monthly wage conversion is calculated by:
  • Multiplying weekly wages by 52 and dividing by 12;
  • Multiplying daily wages by the number of normal working days in the month or
  • Converting product- or task-based wages earned during normal working hours.
• Hourly wage conversion is calculated by:
  • Dividing weekly or daily wages by the normal number of working hours per week or per day; or
  • Dividing product- or task-based wages by the total hours required to complete the work under normal working conditions.

SHUI and trade union fee contributions

Nguyen Vu Phuoc Hong, Manager of HR and Payroll at Dezan Shira & Associates Vietnam, notes that the change [in minimum wage] will impact multiple aspects that are calculated based on the statutory pay rate, including social insurance (SI), health insurance (HI), union fees, unemployment insurance (UI) (hereinafter “SHUI” to refer all four categories) and benefits from social insurance.

Background

For over 10 years, Vietnam’s regional minimum wage has been adjusted every January 1. However, due to the impact of the COVID-19 pandemic and global fluctuations, the two most recent minimum wage adjustments were both made on July 1.

On July 1, 2024, the Vietnamese government updated the regional minimum wage with a 6 percent increase aimed at ensuring a basic living standard in 2025.

Following the restructuring of local administrative units, effective on June 12, 2025, Vietnam has maintained the regional minimum wage regime from 2024, yet adjusted its application in accordance with the new two-level local government model.

With inputs from Vu Nguyen Hanh.

(This article was originally published June 28, 2024. It was last updated November 11, 2025.)

This article first appeared on Vietnam Briefing, our sister platform.