Enterprises must not owe employees

Lawyer Le Tan Ty, Legal Counseling Center (Dong Nai Confederation of Labor) advises on salary for employees when they stop working

* Must comply with regulations

Mr. Nguyen Van Duoc, a resident in Tan An Commune, Vinh Cuu District, was recruited with an indefinite-term labor contract signed by X Co., Ltd (Company X, based in Thien Tan Commune, Vinh Cuu District). At the end of 2020, Company X. transferred capital to Company B, and Mr. Duoc continues to work at Company B. However, before transferring and changing its new name, X. Company Limited still owes Mr. Duoc 2-month salary. Mr. Duoc was questioned, does he have the right to claim Company B to pay him the amount of salary owed previously by Company X.

Labor mediator Pham Dinh Duc said that Company X's conversion of legal entity, name and capital to Company B does not affect the relationship between this legal entity and individuals and organizations before. At the same time, the capital conversion to a new company is always accompanied by the transfer of responsibilities and debts to employees. Therefore, when transferring, the company X owes his salary; if there is no agreement between him and the company X on the form and method of paying this debt, company B must be responsible for paying him.

Ms. Huynh Ngoc Bich (living in An Binh Ward, Bien Hoa City) said that in April 2021, the company where she works only pays employees 70% of the total salary that the company has to pay. The company owed its employees 30% of the salary because it faced difficulties in production and business due to the prolonged impact of the Covid-19 epidemic. Ms. Bich wondered is it legal if the company only pays 70% of salary and owes employees 30% of the total monthly salary?

Discussing this content, labor mediator Pham Dinh Duc said that in principle, the law stipulates that employees are paid directly, fully and on time. Just one day of late payment, salary debt and inadequate payment is a violation of the labor law, and a violation of the contract on the time of payment, the salary level that the enterprise signed previously with the employees. “The Labor Code 2019 also stipulates that in the event of force majeure that the employer has sought all remedies but cannot pay wages on time, it must not be more than 30 days late; If the salary is paid late for 15 days or more, the employer must compensate the employee an amount at least equal to the interest of the late payment calculated according to the interest rate of mobilizing a 1-month term deposit by the bank where the employer opens the account” - Labor mediator Pham Dinh Duc added.

* Will be sanctioned

Since the beginning of 2021, the Legal Consultancy Center (under the Provincial Confederation of Labor) has received many phone calls from employees working at enterprises in the province asking for advice, and questions related to the late paying salaries, or paying partially the monthly salary of the enterprises.

Lawyer Le Tan Ty, Trade Union Legal Counseling Center, said that to claim benefits, employees can ask the Trade Union for support, write a complaint to the Department of Labor, War Invalids and Social Affairs or the Office of Labor, War Invalids and Social Affairs for solutions; or may be through a labor mediator to mediate. In case the conciliation fails or succeeds but the employer does not implement or the time limit for settlement expires, the employee can initiate a lawsuit at the court and the center will be ready to assist the employee.

Lawyer Le Tan Ty added that, in order to prevent enterprises from debt, late payment, and inadequate pay, on March 1, 2020, the Government issued Decree No. 28/2020/ND-CP stipulating sanctioning administrative violations in the field of labor, social insurance, sending Vietnamese people to work abroad under contracts (replacing Decree No. 95/2013/ND-CP and Decree 88/2015/NĐ-CP) -CP). Clause 2, Article 16 of Decree No. 28/2020/ND-CP stipulating penalties for enterprises and employers who fail to pay wages on time; not paying or not paying enough wages to employees as agreed in the labor contract etc. is between VND 5-50 million (depending on the number of employees from 1-301 or more). “This fine is applied to individual employers. In case the employer is an organization, the fine is 2 times higher. Thus, enterprises will be fined up to VND100 million if they are late in paying wages, or paying wages not fully, not timely to employees," emphasized lawyer Le Tan Ty.

According to lawyer Le Tan Ty also, in order to solve the problem of debt, delay or inadequate payment of wages, the employer and employee can amicably discuss to agree on a solution. The employer absolutely cannot unilaterally decide to lead to conflict or dispute. This will be detrimental to both sides.

Nhan Thai