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| Many managers of companies have stated that the business climate will make it difficult for them to maintain employee Tet bonuses at the same level as last year. |
According to Ngo Chi Hung, Deputy Head of Hanoi Industrial Zone and Export Processing Zone Authority, many local businesses have cut salaries, while some still owe back-pay.
He added that many businesses may opt not to give bonuses at all, or they may offer them in the form of products, such as clothes, sweets or cakes.
The owner of one electronics store on Ba Trieu Street, Hanoi, said that profits have dropped by nearly 50% and revenue by 60% from the year before. At the same time, he said, overhead is rising, with increases in such things as electricity, water and interest rates. Because of this situation, his company plans to cut bonuses for the Solar New Year by half, and for Tet (the Lunar New Year) by one-third.
Vo Quoc Thang, Chairman of Dong Tam Joint Stock Company, said, most companies have faced difficulties this year.
Thang added that the only businesses who can offer bonuses are those which made a broke even or made a profit, while those which have taken losses are unable to get loans for the traditional bonuses.
“In previous years, Dong Tam gave a Tet bonuses of between 1-3 months salary to their staff, depending on their position and performance. But this year we will have to consider the cost of these gifts much more carefully because of financial restraints,” the chairman said.
This year is a particularly difficult time in the construction sector. Many construction companies are holding off on announcing how much they will give out in bonuses until they have a better idea of returns on their investments.
A report from the Hanoi Department of Labour, Invalids and Social Affairs, showed that, by November around 14,000 labourers had registered as being unemployed.
Pham Minh Huan, Deputy Minister of Labour, Invalids and Social Affairs, said that companies are being discouraged from paying salaries or bonuses in the form of products unless the employees have agreed to such an arrangement.
Recently, a bakery in Hanoi had paid salaries and bonuses in cakes. A sales manager of the company received his outstanding wages and bonuses, supposed to be worth VND50 million (USD2,380), in cakes.
