Vietnam metro removes 8 execs for overpaying themselves

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Workers at the HCMC Park and Green Trees Company cut a tree. Photo by Diep Duc Minh

Ho Chi Minh City authorities have fired two and removed six other leaders at four local public service companies from their posts for cutting workers' benefits in order to give themselves "hugely inflated" salaries.

The move came after the HCMC People's Committee, the municipal administration, last month issued a report exposing the incredible annual salaries the four state-owned companies paid to their leaders compared to their workers in 2012.

People's Committee chairman Le Hoang Quan called the salaries "ethically wrong."

According to the report, Le Thanh Son, director of HCMC Urban Drainage Company, and Tran Trong Hue, chairman of the HCMC Public Light Company, were paid VND2.6 billion (US$123,320) and VND2.4 billion ($113,830) a year, respectively.

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The other six, Nguyen Trong Luyen, chairman of the HCMC Urban Drainage Company, Tran Minh Hung, director of the HCMC Public Light Company, Nguyen Nhat Tan and Pham Van Vinh, chairman and director of the Sai Gon Traffic Works Company, and Pham Van Hieu and Tran Thien Ha, chairman and director of the HCMC Park and Green Trees Company, respectively, earned from VND691 million-2.2 billion a year ($32,775-104,345).

Meanwhile, workers at the four companies received over VND22 million, or $1,043, per month on average.

Vietnam's annual per capita income for 2012 was $1,555.

The report said the salaries violated Labor Code, and the firms' leaders offered seasonal or definite contracts to more than a thousand workers eligible for indefinite contracts to avoid paying them higher salaries and perks and they then used the extra money to enrich themselves.

According to Vu Duc Dam, Minister of the Government's Office, a government decree on salaries at state-owned companies stipulates that executives' maximum salaries are VND36 million or $1,707 a month, and even when the companies operate well, bonuses must not exceed their salaries by more than half.

The exposure sparked widespread outcry and condemnation of the officials. It prompted the city People's Committee to order the Department of Labor, War Invalids and Social Affairs to carry out inspections of salary payments at all state-owned companies in the city and submit a report in November.

At a meeting on September 12, the city government fired Son and Hue, and removed the other six leaders from their posts.

The city authorities have yet to allocate the latter six to their new posts.

The HCMC Party Committee expelled Luyen and Son of the urban drainage company and Hue of the public light company from the Party, while the five others were only removed from their Party posts.

It ordered authorities to investigate relevant city agencies and the public servants that oversee the four companies' operations for their roles in the matter. Authorities must also sieze the leaders' salaries to return the money to the state budget.

The committee also requested that the four companies' deputy directors and chief accountants, who were paid high salaries of between VND584 million-1.9 billion for the whole 2012, be investigated.

It also ordered that some of the salary money be given to the companies' workers in accordance with the law.

Than Thi Thu, head of the city Party Committee's propaganda department, said the salaries were being collected and the exact amount would be announced later.

The four companies' Party units were censured by  city authorities for their leaders' violations on September 12.

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