QUY ĐỊNH VỀ MỨC LƯƠNG TÍNH TRỢ CẤP THÔI VIỆC/REGULATIONS ON THE SALARY BASIS FOR CALCULATING SEVERANCE ALLOWANCE

Legal situation: Currently, employees at my company are receiving monthly salary of 6,250,000 VND and various allowances, including:

+ Basic salary: 5,000,000 VND/month

+ Living allowances: 1,000,000 VND/month

+ Transportation allowance: 250,000 VND/month

Based on this salary structure, I would like to ask about the method to calculate the salary basis for calculating severance allowance. Should it be calculated based solely on the basic salary, or should other allowances be included?

Thank you, Lawyer.

FDVN’s opinion:

Thank you for sending your inquiry to the FDVN Law Firm. After researching the relevant legal provisions, FDVN would like to provide the following information:

According at clause 3, Article 12 Circular 10/2020/TT-BLĐTBXH , the salary used as the basis for calculating severance allowance is the average salary under the labor contract, including the base salary, salary allowances, and other additional payments for the six consecutive months immediately preceding the employee’s termination. Specifically, these are the following components:

– The salary based on the job and position;

– Allowances to compensate factors such as working conditions, job complexity, employee’s life and employment attraction that the base salary agreed under the employment contract fails to take into account or sufficiently take into account;

– Allowances associated with the job process and performance of the employee.

Thus, the salary used to calculate severance pay is the average salary under the labor contract, including the base salary allowances and other additional payments for the six consecutive months immediately preceding the employee’s termination

In reference to your company’s case, the salary used to calculate severance pay includes the base salary, living expense allowance, and travel allowance (i.e., 6,250,000 VND if this amount remains consistent for the six consecutive months).

The above is FDVN’s advisory opinion regarding your request for advice based on research of legal regulations. We hope that FDVN’s advisory opinion will be useful to you.

According to Nguyen Thi Thao Nguyen – FDVN Law Firm