Overtime cap increase wholeheartedly welcomed by laborers, employers

The Ministry of Labour, War Invalids and Social Affairs is proposing that the Government and the National Assembly allow a rise in overtime hours of laborers from 40 hours to 72 hours per month since there is now an exceptionally high demand of labor for economic recovery.

Workers in Garment 10 Corp. in their shift. (Photo: SGGP)

Most workers in the fields of garment, footwear, electronic parts assembly in the northern industrial parks of Hanoi, Bac Giang Province, Bac Ninh Province or Vinh Phuc Province when asked eagerly welcome the overtime cap increase to have more income for their daily expenses and children tuition.

Many employees following the ‘3 on-site working model’ shared that they wish to work overtime since they have much free time staying at their factories and this would increase their salary. Overtime work on Saturday and Sunday will give them 1.5 times and 2 times as high as the regular wage.

Chairman of the Trade Union in Garment 10 Corp. Tran Quy Dan said that it is rational to increase the overtime hours in order to help laborers earn more money and employers address labor shortage issues in the economic recovery process after the Covid-19 outbreak. However, the Government should consider carefully before introducing detailed regulations on overtime level and hours for businesses to implement.

Vietnam General Confederation of Labor reported that since the beginning of 2022, due to the Covid-19 pandemic, many workers have quitted their job and returned home, leading to a serious labor shortage in several businesses, factories. Meanwhile, the expansion of current projects and the launch of new ones ask for a large quantity of workers, especially in the fields of textile, footwear, electronics, tourism.

Deputy Minister of Labour, War Invalids and Social Affairs Le Van Thanh stated that in order to ensure a smooth flow in the supply chain and manufacturing activities as well as minimizing negative impacts on various industries in the country, his Ministry has proposed a temporary solution of an overtime cap increase to 72 hours a month and 300 hours a year for all industries, effective until December 31, 2022. Depending on the real needs, the Government may propose an extension in October 2022 in the 4th session of the National Assembly.

Agreeing with this change, Deputy General Secretary of the Vietnam Chamber of Commerce and Industry (VCCI) Tran Thi Lan Anh said that the overtime hour rise shows the companionship of the Government to businesses nationwide, which are facing serious labor shortage. The change will obviously help enterprises to timely process their orders, increase their performance.

Simultaneously, it provides a chance for employees to earn more money after a long time off due to the Covid-19 outbreak. This short-term solution is absolutely suitable for the socio-economic recovery program of the Government.

Workers in their lunch break. (Photo: SGGP)

Head of HR and System Management Department in Fly Garment Co. Ltd. Phan Thanh Binh commented that the textile industry has always flexibly increased overtime when orders are pressing. Most businesses in the industry have frequently faced a labor shortage of 20-30 percent in production lines since female workers are in maternal leave. Now that the pandemic unexpectedly comes, the issue becomes more serious, and thus this overtime cap rise is wholeheartedly supported by all companies in the industry.

However, he mentioned the consideration of maintaining employees’ health status via suitable regulations. This means new policies must leave room for businesses and laborers to flexibly adapt as long as it complies with labor agreement.

Supporting the above opinion, Director of Thanh Dat Garment Co. Ltd. stressed on the correspondence to international practice, and the inclusion or not of the overtime coefficient in salary calculation to avoid unnecessary burden to businesses.

Vice President cum General Secretary of Korea Chamber of Commerce in Vietnam (Kocham) Hong Sun also insisted on the necessity of this overtime cap rise to both employers and employees. He said that this matter has been proposed in the past but was refused due to regulations in the Labor Law, creating unwanted pressure to large-scaled factories with a great number of laborers.

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