Every occasion near Tet, the issue of the Tet bonus, 13th month salary is often mentioned by society. During the Lunar New Year in early 2022, the strike of thousands of factory employees of Pouchen Vietnam Company due to the issue of low Tet bonus aroused many debates in society. So, is it legal to go on strike to express dissatisfaction with Tet bonuses that are absent or reduced compared to the previous year?
Analyzing the issue surrounding the strike at the factory of Pouchen Vietnam Company in early 2022 is the core to finding answers to similar strikes in Vietnam in 2023 or in the coming years.
Strike for Tet bonus
On January 7, 2022, after lunch, many employees refused to enter the workshop but went out to protest the Tet bonus policy of Pouchen Vietnam Company in Hoa An ward, Bien Hoa city. After that, a large group of employees spilled onto Highway 1K right in front of the factory gate, causing traffic jams for many hours. The strike of a group of employees initially created a chain effect, causing 16,000 employees to be affected, and join the strike subsequently.
According to information from the labor strike group, on January 6, 2022, Pouchen announced that employees who have worked for a full year or more, depending on their seniority, will receive Tet bonuses ranging from 1 month salary to 1,54 month salary. With this level, employees directly in production receive Tet bonuses in the range of nearly 5 million VND to nearly 20 million VND.
Meanwhile, the highest Tet bonus in 2021 is 1.87 month salary. Before 2021, Tet bonuses can sometimes be up to 2.2 month salary. Thereby, a large group of employees in Pouchen felt dissatisfied with the decrease in Tet bonus each year and right after receiving the notice, decided to organize a strike to demand an increase in Tet bonus.
After 3 days of strike, after agreeing, discussing, and encouraging by Pouchen as well as state management agencies, Pouchen employees have returned to work with the company’s Tet bonus scheme still according to the initial notice, there was no increase.
Strike for Tet bonus from a legal perspective
The employees’ strike like the case of Pouchen company is wrong for two basic reasons when viewed from a legal perspective, specifically according to the provisions of the Labor Code in particular.
Firstly, Tet bonus is not a bonus specified in the labor law system in Vietnam. Thereby, the employees strike to claim Tet bonus or the increase in Tet bonus compared to the previous year is completely wrong and has no legal basis.
Tet bonus is just a bonus to encourage employees after a year of dedication and hard work as well as to motivate employees to continue working for the employer in the next year.
This bonus depends largely on the business performance of the enterprise in the past year. If businesses do poorly and lose money due to objective factors such as the Covid-19 pandemic in 2021, it is obvious that businesses do not have enough money to give Tet bonuses to employees.
Many businesses during the Lunar New Year 2022 as well as 2021 do not even have Tet bonuses. Even if there is a Tet bonus, most Vietnamese businesses, even if they are not affected by the pandemic, only give their employees a Tet bonus of 1 month’s salary. Accordingly, it is completely unreasonable for employees at Pouchen to go on strike to express their displeasure because they “only” receive at least 1 month’s salary.
Secondly, the self-organized strike after receiving the 1-day Tet bonus notice proves that this is an unorganized, unplanned strike, simply a gathering of a group of employees to express their dissatisfaction for the operating mechanism of the enterprise.
This is the reality of most strikes in Vietnam throughout history before and since Vietnam’s first Labor Code took effect in 1995.
According to the provisions of Article 198, Section 5, Chapter XIV of the Labor Code 2019 No. 45/2019/QH14, a strike is a temporary, voluntary and organized stoppage of work by the employees in order to press demands in the process of the labor dispute settlement. A strike shall be organized and lead by the representative organization of employees that has the right to request collective bargaining and is a disputing party.
In order for a strike to demand employees’ rights to be legally organized, employees and employees’ representative organizations must first implement conciliation and arbitration measures. After that, the employees’ representative organization will have to get opinions on organizing the strike from the employees in which at least 50% of the employees must agree. After that, the employees’ representative organization issues a strike decision and announces the strike in writing. Finally, after all the above processes, the organized strike is considered legal.