Regulations on Termination of Contracts for Employees Eligible for Retirement

Mr. Le Ngoc Huynh's unit consulted a lawyer and believes that the unit has the right to terminate the labor contract with employees eligible for a pension without requiring an agreement. The reasons are as follows:

- The Social Insurance Law 2014, Decree 115/2015/ND-CP dated November 11, 2015, detailing several articles of the Social Insurance Law and compulsory social insurance; Circular No. 59/2015/TT-BLDTBXH dated December 29, 2015, detailing and guiding the implementation of several articles of the Social Insurance Law and compulsory social insurance, all guide the age for retirement in this case to be 55 years (male) and 50 years (female).

- According to Clause 4, Article 36; Clause 2, Article 187 Labor Code 2012; Point b, Clause 1, Article 54 of the Social Insurance Law 2014, as long as employees doing heavy, hazardous work reach the minimum retirement age (55 for men; 50 for women) and meet the conditions for social insurance contributions, the unit has the right to terminate the labor contract without requiring the employees' agreement.

- The conditions to terminate the labor contract for employees engaging in heavy, hazardous, or dangerous work (two conditions) are 20 years or more of social insurance contributions; male employees from 55 to 60 years old, female employees from 50 to 55 years old; and 15 years of work in heavy, hazardous, dangerous jobs.

- When terminating the labor contract, the unit must ensure compliance with the responsibilities of the employer as stipulated in Article 47 of the Labor Code 2012.

- If employees continue to work past the age stipulated in Article 187 of the Labor Code 2012, they will be identified as elderly workers. According to Article 167 of the Labor Code 2012, if needed, employers can agree with elderly workers who are in good health to extend working time or sign a new labor contract. However, employers must not assign elderly workers to heavy, hazardous, or dangerous work that adversely affects their health...

Mr. Huynh queries whether the right to terminate the labor contract as described above is conformable. If correct, how are the rights of employees protected by law in this case? If incorrect, is this considered an unlawful unilateral termination of the labor contract? What should employees do to be protected?

Regarding this issue, the Ministry of Labor, Invalids, and Social Affairs responds as follows:

According to Clause 4, Article 36 of the Labor Code, a labor contract terminates when employees meet the conditions for social insurance contribution time and retirement age as stipulated in Article 187 of the Labor Code.

According to Clauses 1 and 2, Article 187 of the Labor Code, employees ensuring the social insurance contribution time conditions as per the law on social insurance are entitled to a pension when males reach 60 years old, and females reach 55 years old. For employees doing specially heavy, hazardous, dangerous work; heavy, hazardous, or dangerous work listed by the Government of Vietnam, they can retire at a younger age as specified in Clause 1 of this Article (under 60 years old for males, under 55 years old for females).

As stipulated in Point b, Clause 1, Article 54 of the Social Insurance Law, male employees from 55 to under 60 years old, female employees from 50 to under 55 years old, with 20 years of social insurance contributions and 15 years of work in heavy, hazardous, dangerous jobs or specially heavy, hazardous, dangerous jobs listed by the Ministry of Labor, Invalids, and Social Affairs, Ministry of Health, or with 15 years of work in areas with a regional allowance coefficient of 0.7 or more, meet the conditions for pension retirement.

According to Article 47 of the Labor Code, within 7 working days from the date of termination of the labor contract, both parties are responsible for fully settling all related benefits; in special cases, the period can be extended but not beyond 30 days. The employer is responsible for completing the certification procedures and returning the social insurance book and other documents held from the employees.

Thus, if male employees from 55 to under 60 years old, and female employees from 50 to under 55 years old, have 20 years of social insurance contributions and 15 years of work in heavy, hazardous, dangerous jobs or specially heavy, hazardous, dangerous jobs listed by the Ministry of Labor, Invalids, and Social Affairs, Ministry of Health, or 15 years of work in areas with a regional allowance coefficient of 0.7 or more, they meet the conditions for pension retirement and fall under the case of labor contract termination as stipulated in Clause 4, Article 36 of the Labor Code.

When terminating the labor contract, both the employer and the employee must fulfill the requirements as stipulated in Article 47 of the Labor Code.

According to the Electronic Portal of the Government of Vietnam

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