As the Labour Code has not yet provided a specific guidance on the “date of disciplinary action” in the form of deferral of salary increase, there are currently three different points of view as follows:
- First: The “date of disciplinary action” in the form of deferral of salary increase is the date on which an Employer issues a disciplinary decision. Accordingly, if the pay raise takes place after 06 months from the date of the disciplinary decision in the form of deferral of salary increase, the violating Employee’ salary will still be increased at the time of common pay raise of the enterprise.
- Second: The “date of disciplinary action” in the form of deferral of salary increase is the date on which the Employee should have been paid a pay raise as agreed upon by Employee and Employer under the LC or upon CLA or any policy of the enterprise, but as a result of the disciplining of the Employee, the violating Employee will be subjected to a 06-month extension of pay raise period from the date of pay raise consideration.
- Third: The “date of disciplinary action” in the form of deferral of salary increase is the date of making the decision on labour discipline, and this date of the disciplinary action is valid only for application of Article 126.1 of the Labour Code, which serve as a milestone to identify the date on which the Employee is entitled to “being removed from discipline”, namely “being acquitted of the previous record” on an offence, in order to provide a basis for evaluation of the Employee’ non-recidivism, because pursuant to Article 125.2 of the Labour Code, there is a high possibility of imposing disciplinary action of dismissal on the Employee who has recidivism in the period of having not yet been removed from the discipline. This view holds that “the date of disciplinary action” and the date on which the disciplinary action is taken in the form of deferral of salary increase (the date of application) are different. Accordingly, the “date of disciplinary action ” is only to determine whether the Employee will be subject to dismissal due to his or her recidivism; while the date of application is still the date on which despite the Employee should have been entitled to a pay raise as agreed upon by the Employee and the Employer, or prescribed in the CLA or under the enterprise policy, the Employee’ pay raise will be deferred to another 06 months since he or she is disciplined. Thus, compared with the second point of view, this point of view also indicates a similarity.
Thus, it seems that the interaction between the pay rise period and disciplinary actions of deferral of salary increase is not entirely clear. For this matter, upon consultation with some specialists from the provincial/municipal DOLISA, they are in favour of the First point of view on the basis of protecting the Employee’ interest, arguing that there is a need for a clear distinction between pay raise and disciplinary action of deferral of the salary increase. Accordingly, the date on which the disciplinary decision is enacted and effective (specialists believe that usually the date of issuance of the disciplinary decision is also the effective date of such decision) will be the date of commencing the disciplinary action period of deferral of the salary increase. If the Employer does not give any pay raise during 6 months of disciplinary action, the Employee will still be entitled to be removed from labour discipline and will be considered for a pay raise if a pay raise period takes place after such a disciplinary period. Experienced lawyers in the area of the labour law lean toward the Third point of view as aforesaid because if it is understood as the First point of view, the disciplinary action of deferral of salary increase will become non-sense, this is because the enterprise of which the pay raise policy will be at the year end, this does not impact the Employee who is disciplined in the form of deferral of salary increase at the beginning of the year. The Second point of view that the “date of disciplinary action” is the date on which the Employee should have been paid a pay raise, will not be supported because it will affect discipline removal and reduce the period of labour discipline.
Based on the said issues, there are many conflicting points of view and in the event of a dispute arising between the Employees and the Employer, only the point of view from the competent dispute settlement agency will be applied. The application of which point of view on the definition of “the date of disciplinary action” is important in choosing the appropriate solution and the legal risks for enterprises. Therefore, with a prudence view, enterprises should send the official letters to the competent and relevant State authorities so that they can obtain formal answers to these issues before implementation.