Over 600 Ho Chi Minh City workers have halted work for the last two days in protest of their Japanese employer Toyo Precision’s announcement it would give them a minimum year-end bonus of only VND100,000 ($4.27).
Workers gathered at the sewing machine part factory on Friday to protest the negligible Tet bonus.
The most-highly anticipated bonus for Vietnamese workers is traditionally given before the Lunar New Year ends and helps migrants travel home for the important holiday.
The strike came after the company, which has been operating in Vietnam for 28 years, said that all workers who have been with the company for less than 12 months will only receive VND100,000 each.
Those who have worked for the company for more than a year will get a bonus of 110% of their average monthly basic income (overtime excluded), according to the employer. This means that a worker with a monthly basic income of VND5 million will get a VND5.5 million Tet bonus.
The company also said that it would raise workers’ salaries by only 2.25% this year.
Nam, a 23-year-old who has been working at the company for nine months, said he needs a decent Tet bonus because his monthly basic income is less than VND5 million.
“I was shocked when I heard that the bonus was VND100,000,” he said. “That’s not even enough to pay for a bus trip to my hometown.”
He admitted that other companies usually give their employees a seniority-based Tet bonus, which means that those who have worked for the company longer receive higher bonuses than those who work for less.
However, even workers with years of seniority at Toyo Precision in HCMC have joined the strike due to low bonuses and the insignificant salary hike.
One such employee, who asked not to be identified, said that he had been working at the factory for 11 years, but his basic salary was still just VND5.66 million a month.
Last year when the government raised the minimum wage by around 6%, the company gave him a mere 1% hike, which equated to a VND50,000 increase.
If his salary were to increase by 2.25% this year, he would receive only VND127,000 more each month, while other Japanese companies nearby are giving their employees at least a 6% hike or an increase of VND260,000.
A female employee said that vegetable prices have increased by 50% and rents by 10%, which means a raise of 2.25% is too low to make up for the higher cost of living.
Pham Manh Quan, chairman of the company’s labor union, said that he was negotiating with the employer’s board of directors to come up with the best solution.
According to Quan, company leaders have said that the plunge of the Japanese yen and rising inflation had badly affected the company’s finances last year.
Since the strike began, the company has agreed to give workers with less than 12 months of employment a bonus of more than VND100,000 based on seniority. But no details have been released as to exactly how much more, and workers are still refusing to go back to work until more of their terms are met.
They want those who have been working for 12 months or more to have a bonus of 140% of their basic monthly salary.
They also want a 5% salary hike.
The average 2023 Tet bonus in HCMC has been estimated at nearly VND13 million, up 45% compared to 2022, according to an announcement released by the municipal Department of Labor, Invalids and Social Affairs last month.
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