From 1 July 2026, Decree No. 161/2026/NĐ-CP, which adjusts the base salary applicable to cadres, civil servants, public employees and the armed forces, officially takes effect. Although it does not apply directly to the private sector, the new base salary will trigger important changes to social insurance (SI) contribution and benefit levels that private-sector businesses and employees need to update in order to remain compliant.
BASE SALARY
VND 2,340,000/month → VND 2,530,000/month
Effective from 1 July 2026 · An increase of approximately 8.1%
1. Who does the new base salary apply to?
Under Decree 161/2026/NĐ-CP (issued 15/5/2026), the new base salary is used as the basis for calculating salary, allowances and other entitlements for the public sector, including cadres, civil servants, public employees, the armed forces, and certain contract groups within state agencies and public administrative units.
Note: wages paid to employees at private-sector businesses are not directly adjusted according to the base salary — they are determined under the labour contract and the regional minimum wage regulations (a separate legal instrument). However, the base salary remains the underlying reference for a number of social insurance contribution and benefit calculations that apply to all SI participants, including those in the private sector.
2. Impact on private-sector businesses and employees
This is the part that directly affects non-state businesses, covering three points to note:
2.1. The compulsory SI/health insurance contribution ceiling increases
The compulsory SI/health insurance contribution ceiling equals 20 times the base salary. From 1 July 2026, this ceiling will increase:
| Period | Base salary | SI/health insurance ceiling (20x) |
|---|---|---|
| Before 01/7/2026 | VND 2,340,000 | VND 46,800,000 |
| From 01/7/2026 | VND 2,530,000 | VND 50,600,000 |
For employees whose monthly SI-contribution salary is VND 50.6 million/month or higher, businesses will pay SI/health insurance contributions at the new ceiling — meaning the contribution amount (both the employer’s and the employee’s share) will increase accordingly.
2.2. The compulsory SI participation threshold for part-time employees also rises
Under current regulations, part-time employees are subject to compulsory SI participation if their monthly salary is equal to or higher than the base salary. This threshold applies generally, with no distinction between the public and private sectors.
| Period | Monthly salary threshold for compulsory SI participation (part-time employees) |
|---|---|
| Before 01/7/2026 | ≥ VND 2,340,000 |
| From 01/7/2026 | ≥ VND 2,530,000 |
As a result, from 1 July 2026, part-time employees with a monthly SI-contribution salary of VND 2,530,000 or more are subject to compulsory SI participation, covering sickness, maternity, occupational accident and disease, retirement, and death benefits.
2.3. A series of SI benefits calculated on the “reference level”/base salary will also increase
Under the 2024 Law on Social Insurance, for as long as the base salary has not been abolished, the “reference level” — the basis for calculating a number of SI benefits — is set equal to the base salary. Therefore, when the base salary rises to VND 2,530,000/month from 1 July 2026, a series of benefits applying generally to compulsory SI participants — including those at private-sector businesses — will increase accordingly:
| Benefits | Calculation method | Before 01/7/2026 | From 01/7/2026 |
|---|---|---|---|
| Post-sickness / post-maternity / post-occupational-accident-and-disease recuperation allowance | 30% of the reference level/day | VND 702,000/day | VND 759,000/dayngày |
| Lump-sum childbirth or adoption allowance | 2x the reference level/child | VND 4,680,000/child | VND 5,060,000/child |
| Lump-sum occupational accident/disease allowance (5–30% reduced working capacity) | 5x base salary (starting at 5%) + 0.5x per additional 1% | VND 11.7 million (5%) +VND 1.17 million/1% | VND 12.65 million (5%) +VND 1.265 million/1% |
| Monthly occupational accident/disease allowance (≥31% reduced working capacity) | 30% of base salary (starting at 31%) + 2%/1% additional | VND 702,000/month (31%) +VND 46,800/month per 1% | VND 759,000/month (31%) +VND 50,600/month per 1% |
| Attendant allowance (≥81% reduced working capacity, with special conditions) | Equal to 1x base salary/month | VND 2,340,000/month | VND 2,530,000/month |
| Lump-sum death allowance due to occupational accident/disease (paid to next of kin) | 36x base salary | VND 84.24 million | VND 91.08 million |
| Funeral allowance | 10x the reference level | VND 23,400,000 | VND 23,400,000 |
| Monthly survivor’s allowance – standard case | 50% of the reference level | VND 1,170,000/month | VND 1,265,000/month |
| Monthly survivor’s allowance – dependant with no direct caregiver | 70% of the reference level | VND 1,638,000/month | VND 1,771,000/month |
| Minimum pension (with full 20 years of compulsory SI participation) | Not lower than the base salary | VND 2,340,000/month | VND 2,530,000/month |
These benefits apply to all employees participating in compulsory SI, regardless of whether they work for a state agency or a private-sector business. Businesses should update these benefit levels in HR policies, employee handbooks, and communications to employees regarding sickness, maternity, occupational accident and disease, retirement, and death benefits arising from 1 July 2026.