Vietnam to raise retirement age, allow independent trade unions
HANOI: Vietnam this week adopted an amended Labour Code that allows the formation of independent trade unions at the grassroots level and raises the retirement age to cope with an imminent labour shortage.
The Communist-ruled country has one of Asia's fastest growing economies driven by robust foreign investment and exports largely produced by labour-intensive industries.
The adoption of the law, hailed by the United States Embassy here as an “historic legislation”, is expected to pave the way for the ratification of several free trade pacts Vietnam has signed, including one with the European Union (EU).
The National Assembly, the country's lawmaking body, ratified the amended Labour Code on Wednesday. It will take effect in 2021.
Allowing the formation of the independent trade unions is aimed at “protecting the interests of labourers,” said the Ministry of Labour.
The ministry said the move would also facilitate Vietnam’s efforts to integrate further into the global economy.
Labour issues had often topped the negotiation agendas for these free trade deals.
The EU signed the free trade deal with Vietnam in June. The agreement, which includes a chapter on sustainable development, such as implementing international standards on labour rights and the Paris climate accord, still needs the approval of the European Parliament.
The law also improves collective bargaining rights, strengthens protections against discrimination at work, and enhances protections for younger workers.
Under the new legislation, the retirement age of men will be gradually raised by two years to 62 by 2028, while that of women by five years to 60 by 2035, a copy of the new law stated.
The adjustment of the retirement ages, said the labour ministry, is aimed at avoiding an imminent labour shortage from 2040 as Vietnam’s population continues to age.