Question 30. If the probationary contract only states one gross salary, when entering into a LC, the salary stated in LC can be clearly separated into each part, including the basic salary, allowances but not include social insurance and bonuses?


For the salary prescribed in LC, in principle, if a probation contract has agreed that the only amount is the salary (this amount is not divided into small amounts including basic salary, allowances, bonuses, etc.), upon entering into a LC, the LC must be correctly prescribed by the Employer as such amount, not divided into salary, allowances and bonuses, unless the Employee agrees to separate as aforesaid, in that case, the gross salary is understood as the agreement between the parties.

The labour law does not have specific regulations about allowing thr Employer to unilaterally split the total salary stated in the probationary contract (offer letter) into salary, allowances and bonuses in a LC. However, general regulations on the rights and obligations of the Employer and the Employee of the Labour Code prescribes that: “Employee is entitled to be paid a salary…on the basis of an agreement reached with Employer…”[1] and “Employer is obliged to…implement…other lawful agreements with Employee…”[2]. Therefore, based on the analysis of the law for explaining this point, the Employer is not allowed to split the salary without the Employee’s consent because in some cases splitting the salary can reduce the amount of social insurance premium of the Employer and indirectly affect the Employee’s social insurance benefits later.

[1] Article 5.1 of the Labour Code

[2] Article 6.2 of the Labour Code