2026 UPDATE ON SALARY USED AS THE BASIS FOR SOCIAL INSURANCE CONTRIBUTIONS

The 2024 Law on Social Insurance provides that compulsory social insurance contributions are calculated based on the salary serving as the basis for contributions. For employees subject to a salary regime determined by their employers, the monthly salary serving as the basis for compulsory social insurance contributions comprises the salary according to the job or title, salary-based allowances, and other additional amounts agreed to be paid regularly and consistently in each pay period.

Enterprises must correctly determine the applicable regional minimum wage based on the location of their head office or the place where employees work. The salary stated in the employment contract must not be lower than the applicable regional minimum wage. On that basis, the enterprise determines the salary used as the basis for social insurance contributions by identifying the salary components subject to contribution.

What salary components are included in the salary used as the basis for compulsory social insurance contributions?

Under Point b, Clause 1, Article 31 of the Law on Social Insurance 2024, as further guided by Article 7 of Decree No. 158/2025/ND-CP, the monthly salary used as the basis for compulsory social insurance contributions for employees in the enterprise sector comprises three groups of components:

• Salary according to the job or title: calculated on a time basis (monthly), determined according to the salary scale and salary table formulated by the enterprise pursuant to Article 93 of the Labour Code, and agreed upon in the employment contract.
• Salary-based allowances: allowances intended to compensate for factors relating to working conditions, the complexity of the work, living conditions, and labour attraction that are not, or are not fully, reflected in the salary stated above. This excludes allowances that depend on or fluctuate according to labour productivity, the work process, or the quality of the employee’s work performance.
• Other additional amounts: amounts agreed to be paid regularly and consistently in each pay period.

Bonuses under Article 104 of the Labour Code, meal allowances for mid-shift meals, allowances for petrol, telephone, travel, housing, childcare, and child-rearing, support provided upon the marriage or death of a family member, and other allowances and subsidies not associated with the performance of the job or title specified in the employment contract are not included in the salary used as the basis for compulsory social insurance contributions.

Minimum and Maximum Bases for Compulsory Social Insurance Contributions in 2026

Under Point đ, Clause 1, Article 31 of the Law on Social Insurance 2024, the salary used as the basis for compulsory social insurance contributions must be at least equal to the reference salary and must not exceed 20 times the reference salary applicable at the time of contribution.

Under Article 7 of the Law on Social Insurance 2024, during the period in which the statutory pay rate has not been abolished, the reference salary is determined based on the statutory pay rate applicable from time to time. In 2026, two periods apply different statutory pay rates:

Period	Statutory pay rate (= reference salary)	Minimum social insurance contribution basis	Maximum social insurance contribution basis (20 times)
From 1 January 2026 to 30 June 2026	VND 2,340,000/month	VND 2,340,000/month	VND 46,800,000/month
From 1 July 2026 (under Decree No. 161/2026/ND-CP)	VND 2,530,000/month	VND 2,530,000/month	VND 50,600,000/month

This represents an important change from the regulations applicable before 1 July 2025: the minimum basis for compulsory social insurance contributions is now linked to the reference salary (statutory pay rate), rather than being directly linked to the regional minimum wage as provided under the former regulations in Decision No. 595/QD-BHXH. Enterprises should distinguish these two concepts when reviewing their salary scales and tables.

2026 Regional Minimum Wage — Basis for Determining the Salary Stated in Employment Contracts

Although the regional minimum wage is no longer the direct minimum basis for calculating social insurance contributions under the new law, it remains important: it is the lowest wage that an enterprise may state in an employment contract and pay to an employee performing the simplest work under normal working conditions. Since the salary used as the basis for social insurance contributions is determined based on the salary stated in the employment contract, the regional minimum wage continues to indirectly affect the actual salary used as the basis for social insurance contributions.

Under Decree No. 293/2025/ND-CP, the regional minimum wages applicable from 1 January 2026 are as follows:

Region	Monthly minimum wage	Hourly minimum wage
Region I	VND 5,310,000	VND 25,500
Region II	VND 4,730,000	VND 22,700
Region III	VND 4,140,000	VND 20,000
Region IV	VND 3,700,000	VND 17,800

The 2026 regional minimum wages increase by VND 250,000 to VND 350,000 per month compared with the rates previously applicable under Decree No. 74/2024/ND-CP, representing an average increase of approximately 7.2%.

Enterprises determine the applicable region according to the following principle: an entity operating in a locality falling within a particular region shall apply the regional minimum wage applicable to that locality; where an enterprise has branches operating in different localities, each branch shall apply the regional minimum wage applicable to the locality in which that branch operates.

What Enterprises Need to Do When Updating Their 2026 Salary Scales and Tables

To ensure compliance with applicable regulations and mitigate the risk of additional collection of social insurance contributions or administrative penalties during inspections or audits by the social insurance authority, enterprises should take the following steps:

• Review the operating locations of the head office and each branch to correctly determine the applicable regional minimum wage under Decree No. 293/2025/ND-CP.
• Compare the salary stated in each employment contract against the corresponding regional minimum wage, particularly for positions involving simple work, to ensure that the salary is not lower than the prescribed minimum.
• Reclassify the allowances and additional amounts currently paid to employees to determine which amounts are included in the salary used as the basis for social insurance contributions under Article 7 of Decree No. 158/2025/ND-CP, thereby avoiding underpayment or overpayment of contributions.
• Update the maximum basis for social insurance contributions for the two periods in 2026 (before and after 1 July 2026) for employees whose salary is VND 46,800,000/month or more, so that the contribution amount is adjusted at the appropriate time when the statutory pay rate increases.
• Notify employees and adjust the internal salary scales and salary tables where changes arise, ensuring compliance with the requirements for consultation with the employee representative organization at the grassroots level (if any) before issuance.

The regulations on the salary used as the basis for compulsory social insurance contributions in 2026 contain two points to which enterprises should pay particular attention. First, the minimum basis for social insurance contributions is now linked to the reference salary (statutory pay rate), rather than being directly linked to the regional minimum wage as under the previous regulations. Second, the statutory pay rate is adjusted during 2026 (from 1 July 2026), resulting in a change to the maximum basis for social insurance contributions between the two halves of the year. In conjunction with the increase in the regional minimum wage from the beginning of the year under Decree No. 293/2025/ND-CP, enterprises should update all three factors concurrently when formulating and adjusting salary scales, salary tables, and social insurance contribution policies applicable to employees.