Are Probationary Employees Required to Contribute to Mandatory Social Insurance?

The Law on Social Insurance 2014 took effect from January 1, 2016. However, many provisions on social insurance (SI) only officially came into effect on January 1, 2018.

One of the new regulations on SI is the expansion to include two additional groups required to participate in mandatory SI. These are employees (EE) with a labor contract (LC) of 1 month to less than 3 months and employees who are foreign citizens working in Vietnam with a work permit issued by a competent authority of Vietnam, or a practicing certificate issued by a competent authority of Vietnam, allowed to participate in mandatory SI according to the regulations of the Government of Vietnam. However, many employees are still concerned about the probation period, wondering if it is covered by SI.

Decision 595/QD-BHXH of Vietnam Social Security stipulates those who participate in SI, health insurance (HI), and unemployment insurance (UI) include: People working under an LC or employment contract for an indefinite term, a definite term LC, an LC for seasonal work or for a certain job with a term of 3 months to less than 12 months. People working under an LC with a term of 1 month to less than 3 months (implemented from January 1, 2018); Managers of businesses, managers operating cooperatives with a salary."

Furthermore, Article 26 of the Labor Code 2012 stipulates that the employer and the employee can agree on probationary work, the rights, and obligations of both parties during the probation period. If there is an agreement on probationary work, the parties may enter into a probation contract. The probation contract must include the contents specified in points a, b, c, d, e, g, and h of Clause 1, Article 23 of the Labor Code, excluding contents on SI and HI.

Thus, if the employee and the employer sign a separate probation contract, not included in the LC, the probation period does not fall under mandatory SI and HI participation. However, for employees not subject to mandatory SI, HI, UI, besides the salary according to the job, the employer is responsible for additionally paying an amount equivalent to the SI, HI, UI contributions at the same time as the employee's salary payment (according to Clause 3, Article 186 of the Labor Code).

According to the official dispatch of the Ministry of Labor, War Invalids and Social Affairs (MOLISA) and Vietnam Social Security guiding on solving problems in implementing the SI Law, for employees with a probation period included in the LC which is subject to mandatory SI participation, the employer and the employee must pay mandatory SI contributions for the probation period.

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