The Company Failing to Pay Social Insurance for Employees Will Be Subject to Administrative Penalties of Up to 75,000,000 VND?
Current Administrative Fines for Unpaid Social Insurance Contributions for Employees
Based on Article 39 of Decree 12/2022/ND-CP, the regulations are as follows:
"Article 39: Violations on compulsory social insurance contributions, unemployment insurance contributions
1. A fine ranging from 500,000 VND to 1,000,000 VND shall be imposed on an employee who agrees with the employer not to participate in compulsory social insurance, unemployment insurance, participates in an inappropriate group, or at an incorrect rate.
2. A fine ranging from 1,000,000 VND to 3,000,000 VND shall be imposed on an employer who commits any of the following acts:
a) Annually failing to publicly post information on employees’ social insurance contributions provided by the social insurance agency as prescribed in Clause 7, Article 23 of the Social Insurance Law;
b) Failing to provide or incompletely providing information about compulsory social insurance, unemployment insurance contributions of employees at the request of the employees or the trade union.
3. A fine ranging from 1,000,000 VND to 3,000,000 VND shall apply per employee violation but shall not exceed 75,000,000 VND for an employer who fails to complete the procedures to certify unemployment insurance contributions for employees to complete their unemployment insurance benefit applications as prescribed.
4. A fine ranging from 5,000,000 VND to 10,000,000 VND shall be imposed on an employer for failing to accurately, fully, and promptly provide information, documents related to compulsory social insurance contributions, unemployment insurance contributions as requested by the competent state agency or social insurance agency.
5. A fine ranging from 12% to 15% of the total amount of compulsory social insurance contributions, unemployment insurance contributions at the time of recording the administrative violation, but not exceeding 75,000,000 VND, shall be imposed on an employer committing one of the following acts:
a) Delaying compulsory social insurance contributions, unemployment insurance contributions;
b) Contributing to social insurance, unemployment insurance at incorrect rates but not considered as evasion;
c) Contributing social insurance, unemployment insurance insufficiently for individuals required to join compulsory social insurance, unemployment insurance but not considered as evasion;
d) Misappropriating employees' social insurance, unemployment insurance contributions.
6. A fine ranging from 18% to 20% of the total amount of compulsory social insurance contributions, unemployment insurance contributions at the time of recording the administrative violation, but not exceeding 75,000,000 VND, shall be imposed on an employer failing to make social insurance, unemployment insurance contributions for all employees required to join, without reaching the level for criminal prosecution.
7. A fine ranging from 50,000,000 VND to 75,000,000 VND shall be imposed on an employer committing any of the following acts:
a) Evading compulsory social insurance contributions, unemployment insurance contributions without reaching the level for criminal prosecution;
b) Altering or fabricating documents in a dossier to propose lower contribution rates to the Occupational Accident and Disease Fund without reaching the level for criminal prosecution.
8. A fine ranging from 50,000,000 VND to 70,000,000 VND shall be imposed on an organization that evaluates occupational safety and hygiene providing false reports on occupational safety, hygiene, and the reduction of occupational accident frequency.
9. Additional sanctions
Suspension of occupational safety and hygiene assessment activities from 01 month to 03 months for the organization that commits the violation specified in Clause 8 of this Article.
10. Remedial measures
a) The employer must pay the full amount of social insurance contributions, unemployment insurance contributions must be paid to the social insurance agency for the violations specified in Clauses 5, 6, 7 of this Article;
b) The employer must also pay an interest amount equal to twice the average investment interest rate of the social insurance fund of the preceding year on the late, unpaid, evaded, or misappropriated contributions; if not implemented, the competent authority may request banks, other credit institutions, or the state treasury to deduct from the employer’s account the unpaid, late contributions and the interest on the contributions calculated at the highest rate for non-term deposits announced by state-owned commercial banks at the time of penalty into the account of the social insurance agency for the violations specified in Clauses 5, 6, 7 of this Article for 30 days or more."
These administrative fines illustrate the severity of not complying with compulsory social insurance contributions and unemployment insurance. Moreover, organizations and individuals violating these regulations will face additional penalties in accordance with the stipulated sanctions.
Note: The administrative fines imposed on employers as prescribed apply to individuals only. In case an organization commits a violation, the administrative fine shall be doubled compared to that for an individual, except as prescribed in Clause 8 of this Article.
Will a company be fined up to 75,000,000 VND for not paying social insurance for employees?
Is it the employer's responsibility to contribute to social insurance monthly?
Based on Article 21 of the 2014 Social Insurance Law, the regulations are as follows:
"Article 21. Responsibilities of employers
1. Preparing dossiers for employees to be granted social insurance books, paying and enjoying social insurance.
2. Contributing social insurance as prescribed in Article 86, and monthly deducting from employees' wages as prescribed in Clause 1, Article 85 of this Law to jointly pay into the social insurance fund.
3. Referring employees eligible under Point a, Clause 1, Clause 2, Article 45, and Article 55 of this Law to undergo medical examination to evaluate the decrease in working capacity at the Medical Assessment Council.
4. Coordinating with the social insurance agency to pay social insurance benefits to employees.
5. Coordinating with the social insurance agency to return the social insurance book to employees, certify the period of social insurance contributions when employees terminate their labor contract or employment or resign according to the law.
6. Providing accurate, full, and promptly information, documents related to social insurance contributions and benefits as requested by the competent state agency or social insurance agency.
7. Every six months, publicly posting information about social insurance contributions for employees; providing information about social insurance for employees when requested by employees or the trade union.
8. Annually publicly posting information about employees’ social insurance contributions provided by the social insurance agency as prescribed in Clause 7, Article 23 of this Law."
Employers are responsible for making monthly social insurance contributions as prescribed by law.
Are employees required to pay social insurance?
Based on Article 19 of the 2014 Social Insurance Law, the regulations are as follows:
"Article 19. Responsibilities of employees
1. Paying social insurance according to this Law.
2. Complying with regulations on social insurance dossiers.
3. Safeguarding the social insurance book."
Paying social insurance is indeed the responsibility of employees.
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