Question:
My company does not have a mechanism for receiving the 13th-month salary. Is the 13th-month salary mandatory under the law?
Answer:
Currently, the 2019 Labor Code and related legal documents do not define the 13th-month salary. However, the 13th-month salary is widely used in practice. The 13th-month salary is considered a bonus that employees may receive at the end of the year based on the agreement between the parties.
The 13th-month salary and the Tet bonus share the common characteristic of being paid at the end of the year and being decided by the employer. The employer may use the 13th-month salary as a bonus to encourage employees to make greater efforts in their work.Currently, the 2019 Labor Code and related documents do not contain any provision requiring employers to pay the 13th-month salary to employees.
Article 104 of the 2019 Labor Code provides as follows:
“1. Bonus means a sum of money or property or other forms that the employer rewards the employee based on production and business results and the employee’s job performance.
2. The bonus regulations shall be decided by the employer and publicly announced at the workplace after consulting with the grassroots-level employee representative organization where such organization exists.”
Accordingly, the employer is not obligated to pay the 13th-month salary to employees. Whether an employee is entitled to the 13th-month salary depends on production and business results and the employee’s job performance.
The bonus regulations shall be decided by the employer and publicly announced at the workplace after consulting with the grassroots-level employee representative organization where such organization exists.
Consultation: Labor and Employment Services
