Contribution Rate for Voluntary Social Insurance for Employees Eligible for Retirement Age but Have Not Fully Paid Mandatory Social Insurance at Units with Bankruptcy Decisions
Employees Eligible for Pension Age But Have Not Yet Fully Paid Compulsory Social Insurance Contributions in Bankrupt Units Can Voluntarily Pay Social Insurance Contributions to Receive Pension?
On June 21, 2023, Vietnam Social Security issued Official Dispatch 1880/BHXH-CSXH in 2023 to implement social insurance policies for employees who have not fully paid social insurance contributions in certain units.
Employees in the following units may voluntarily pay social insurance contributions to receive a pension:
- Units undergoing bankruptcy procedures- Units with a court-issued bankruptcy decision- Units no longer operating at the registered address- Units without a legal representative
Additionally, voluntary social insurance contributions may be collected on a one-time basis from employees who are eligible for retirement age, with actual social insurance payment periods ranging from 10 to less than 20 years (excluding periods without social insurance contributions) if the employees wish to pay.
Voluntary Social Insurance Payment Rates for Employees Eligible for Pension Age But Have Not Yet Fully Paid Social Insurance in Bankrupt Units
What is the Voluntary Social Insurance Payment Rate for Employees Eligible for Pension Age But Have Not Yet Fully Paid Compulsory Social Insurance in Units with a Bankruptcy Decision?
According to Subsection 2, Section 3, Part II of Official Dispatch 1880/BHXH-CSXH in 2023, the voluntary social insurance contribution rate for employees eligible for pension age but who have not fully paid compulsory social insurance in units with a bankruptcy decision is stipulated as follows:
Confirmation of social insurance participation period on the social insurance book and collection of social insurance contributions from employees
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3. Collection of voluntary social insurance contributions on a one-time basis for the missing periods
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3.2 Contribution Rate: According to Clauses 1, 4, Article 10 of Decree 134/2015/ND-CP dated December 29, 2015, by the Government of Vietnam; in which the income used as the basis for voluntary social insurance contributions is chosen by the employee in accordance with the law.
Clauses 1 and 4, Article 10 of Decree 134/2015/ND-CP stipulate as follows:
Contribution Rate
The voluntary social insurance contribution rate according to Clause 1, Article 87 of the Law on Social Insurance and the payment method in Clause 1, Article 9 of this Decree is stipulated as follows:
1. The monthly contribution rate is 22% of the monthly income chosen by the voluntary social insurance participant.
The lowest monthly income chosen by the voluntary social insurance participant is the rural poverty threshold as stipulated by the Prime Minister of the Government of Vietnam, and the highest is 20 times the statutory pay rate at the time of payment.
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4. The one-time contribution for the missing years as stipulated at Point e, Clause 1, Article 9 of this Decree is calculated as the total contribution for the remaining months, applying compound interest based on the average investment interest rate of the social insurance fund announced by Vietnam Social Security of the year preceding the payment year.
The voluntary social insurance contribution rate for employees eligible for pension age but who have not fully paid compulsory social insurance in units with a bankruptcy decision is calculated as the total contribution for the missing months, applying compound interest based on the average investment interest rate of the social insurance fund announced by Vietnam Social Security of the year preceding the payment year.
The monthly contribution rate is 22% of the monthly income chosen by the voluntary social insurance participant.
What Age Will Employees be Eligible for Retirement in 2023?
According to Article 169 of the Labor Code 2019, the retirement age is stipulated as follows:
Retirement Age
1. Employees who satisfy the conditions for the social insurance contribution period as stipulated by social insurance laws are entitled to a pension upon reaching the retirement age.
2. The retirement age for employees in normal working conditions is adjusted according to a roadmap until reaching 62 years old for male employees in 2028 and 60 years old for female employees in 2035.
From 2021, the retirement age for employees in normal working conditions is 60 years and 3 months for male employees and 55 years and 4 months for female employees; thereafter, each year it increases by 3 months for male employees and 4 months for female employees.
3. Employees with reduced working capacity; engaged in particularly heavy, hazardous, and dangerous jobs; or working in areas with extremely difficult socio-economic conditions may retire at a lower age but no more than 5 years younger than the age stipulated in clause 2 of this Article at the retirement time unless otherwise stipulated by law.
4. Employees with high qualifications, technical expertise, and in certain special cases may retire at a higher age but no more than 5 years older than the age stipulated in clause 2 of this Article at the retirement time unless otherwise stipulated by law.
5. The Government of Vietnam provides detailed regulations for this Article.
In 2023, male employees in normal working conditions will retire at the age of 60 years and 9 months.
Female employees in normal working conditions will retire at the age of 56 years.
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