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Tuesday, July 23, 2024

Vietnamese textile & garment companies struggling to pay worker bonus

With exports of textiles and garments dropping in 2023, many Vietnamese companies are struggling to pay their workers an extra month’s salary as a bonus before Tet, which is the Vietnamese New Year.

Paying the Tet bonus is a challenge for several textile and garment manufacturers this year,” Pham Xuan Hong, Chairman of the Textile, Embroidery and Knitting Association, said.

“However, it is imperative that businesses, if they are still operating, must resolve this issue whether they have made a profit or loss in 2023,” Hong added.

According to him, sales dipped 20-25 percent for most textile and garment companies, while a majority reported losses as they reduced order prices to keep their factories operational.

He advised companies to pay at least half a month’s salary as a Tet bonus if they could not pay a whole month’s salary.

Hong also projected a bleak 2024 in textile and garment exports due to the still ongoing Russia-Ukraine war as well as the Israel-Hamas war.

In the past, workers have even been paid two month’s salary as a bonus based on their seniority in the company or for those who have worked for more than 12 years.

Vinatex, the most prominent Vietnamese textile and garment company in terms of sales and number of employees, had announced that it would pay the minimum extra month bonus. At the same time, its profitable subsidiaries can pay eligible employees two months’ salary as a bonus.

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