Can the Company Agree with Employees Not to Pay Social Insurance?
According to Article 21 of the 2014 Social Insurance Law, the responsibilities of employers are as follows:
- Prepare documentation for employees to be issued social insurance books, pay, and enjoy social insurance benefits.
- Pay social insurance as stipulated in Article 86 and deduct from employees' monthly wages as stipulated in Clause 1, Article 85 of this Law to make a one-time payment into the social insurance fund.
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At Point a, Clause 1, Article 2 of the 2014 Social Insurance Law, it is stipulated as follows:
Employees who are Vietnamese citizens subject to compulsory social insurance participation include:
Employees working under contracts of indefinite term, definite term, seasonal contracts, or contracts for specific jobs with a duration from 3 months to under 12 months, including labor contracts signed between the employer and the legal representative of persons under 15 years old as stipulated by labor laws.
Simultaneously, Article 17 of this Law stipulates the following prohibited acts:
- Evading compulsory social insurance and unemployment insurance contributions.
- Delaying the payment of social insurance and unemployment insurance amounts.
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Based on the above provisions, employees who sign fixed-term contracts (12 months) are subject to compulsory social insurance participation. Therefore, if your company does not pay social insurance for you, it constitutes a legal violation.
Penalties for not paying social insurance: Violations regarding the payment of compulsory social insurance may be penalized according to Article 38 of Decree 20/2020/ND-CP. To be specific:
A fine from VND 500,000 to VND 1,000,000 shall be imposed on employees who agree with employers not to participate in compulsory social insurance or unemployment insurance, participate incorrectly, or not at the prescribed level.
For companies, depending on the specific case, the administrative fine for this violation shall not exceed VND 75 million.
Respectfully!
