SOME LEGAL ISSUES ON COMPULSORY SOCIAL INSURANCE

Compulsory social insurance is a type of social insurance organized by the State that employees and employers must participate in. What should we pay attention to when participating in compulsory social insurance contributions?

I. Subjects of application

Pursuant to Clauses 1, 2, 3, Article 2 of the Law on Social Insurance 2014 stipulating the subjects of application of compulsory social insurance is stipulated as follows:

* Vietnamese employees who are eligible for compulsory social insurance: 

– A person working under an indefinite-term labor contract, a definite-term labor contract, a seasonal labor contract or a certain job with a term from full 03 months to less than 12 months, including a labor contract signed between the employer and the legal representative of the person under 15 years old as prescribed definition of labor legislation;

– The employee works under a labor contract with a term from full 01 month to less than 03 months;

– Officers, civil servants, public servants;

– Defense workers, police workers, other workers in basic organizations

– Officers and professional soldiers of the People's Army; professional officers, non-commissioned officers, officers and non-commissioned officers of technical expertise of the people's police; persons doing basic work shall receive the same salary as military personnel;

– Non-commissioned officers and soldiers of the People's Army; non-commissioned officers and soldiers of the People's Police serving for a definite period; Military, police and basic cadets who are studying are entitled to subsistence expenses;

– Persons who go to work abroad under contracts specified in the Law on Vietnamese employees who go to work abroad under contracts;

– Enterprise managers, managers and operators of cooperatives with salaries;

– Non-specialized workers in communes, wards or townships.

* The employee is a foreign citizen working in Vietnam who has a work permit or a practice certificate or a practice permit issued by a competent authority of Vietnam.

* Employers participating in compulsory social insurance include state agencies, non-business units, people's armed forces units; political organizations, socio-political organizations, socio-political-professional organizations, socio-professional organizations, other social organizations; foreign agencies, organizations and international organizations operating in the territory of Vietnam; enterprises, cooperatives, individual business households, cooperative groups, other organizations and individuals that hire or use labor under labor contracts.  

II. Compulsory social insurance regimes

Pursuant to Clause 1, Article 4 of the Law on Social Insurance 2014, compulsory social insurance has the following regimes:

– Sickness;                                             

– Retirement;

– Maternity;                                             

– Death.

–  Labor accidents, occupational diseases; 

III. Contribution rate when participating in compulsory social insurance

Pursuant to Clause 1, Article 85 of the Law on Social Insurance 2014 and Article 12.13 of Decree 143/2018/ND-CP stipulates the contribution rate of employees participating in compulsory social insurance for Vietnamese and foreign workers as follows:

For enterprises operating in industries with high risk of accident - occupational diseases, if eligible, send a written request and be approved by the Ministry of Invalids and Labor, they shall be entitled to contribute to the MOLISA fund at a lower rate of 0.3%.

Employees and employers being enterprises, cooperatives, individual business households, cooperative groups operating in the fields of agriculture, forestry, fishery and salt industry pay wages according to products, according to contracts, the constant contribution as on the method of contribution shall be made monthly, every 3 months or every 6 months.

Above is an article that provides some basic information about Vietnamese legal regulations, some compulsory social insurance issues.

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Hoang Pham (James) / Managing Partner at: hoang.pham@vselawyers.com

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Attention: This legal update is not an advice and should not be treated as such.