How much is penalty for failing to pay health insurance for employees in Vietnam?

1. Are enterprises required to participate in health insurance for employees in Vietnam?

Pursuant to Clause 1, Article 168 of the Labor Code 2019 has the following provisions:

1. Employers and employees shall participate in compulsory social insurance, compulsory health insurance and unemployment insurance and enjoy the benefits in accordance with provisions of the law on social insurance, health insurance and unemployment insurance.

Employers and employees are encouraged to obtain other kinds of insurance for employees.

According to Clause 1, Article 2 of the Law on Social Insurance 2014, employees being Vietnamese citizens shall be covered by compulsory social insurance, including:

a/ Persons working under indefinite-term labor contracts, definite-term labor contracts, seasonal labor contracts or contracts for given jobs with a term of between full 3 months and under 12 months, including also labor contracts signed between employers and at-law representatives of persons aged under 15 years in accordance with the labor law;

b/ Persons working under labor contracts with a term of between full 1 month and under 3 months;

c/ Cadres, civil servants and public employees;

d/ Defense workers, public security workers and persons doing other jobs in cipher organizations;

dd/ Officers and professional army men of the people's army; officers and professional non-commissioned officers and officers and technical non- commissioned officers of the people's public security; and persons engaged in cipher work and enjoying salaries like army men;

e/ Non-commissioned officers and soldiers of the people’s army; non- commissioned officers and soldiers on definite-term service in the people’s public security; army, public security and cipher cadets who are entitled to cost- of-living allowance;

g/ Vietnamese guest workers defined in the Law on Vietnamese Guest Workers;

h/ Salaried managers of enterprises and cooperatives;

i/ Part-time staffs in communes, wards and townships.

Thus, according to the above regulations, the business you are working for is responsible for participating in health insurance for you in Vietnam.

2. How much is penalty for failing to pay health insurance for employees in Vietnam?

Pursuant to Clause 2, Article 80 of Decree 117/2020/ND-CP, there are regulations:

2. The following fines shall be imposed upon an employer for failing to pay, insufficiently or lately paying health insurance contributions for his/her employees who are subjected to compulsory health insurance, or evading payment of health insurance contributions:

a) A fine ranging from VND 1.000.000 to VND 3.000.000 shall be imposed for the violation involving less than 10 employees;

b) A fine ranging from VND 3.000.000 to VND 5.000.000 shall be imposed for the violation involving from 10 to less than 50 employees;

c) A fine ranging from VND 5.000.000 to VND 10.000.000 shall be imposed for the violation involving from 50 to less than 100 employees;

d) A fine ranging from VND 10.000.000 to VND 20.000.000 shall be imposed for the violation involving from 100 to less than 500 employees;

dd) A fine ranging from VND 20.000.000 to VND 30.000.000 shall be imposed for the violation involving from 500 to less than 1.000 employees;

e) A fine ranging from VND 30.000.000 to VND 40.000.000 shall be imposed for the violation involving from 1.000 employees or more.

According to this Article, the fine level for the act of failing to pay health insurance for employees in Vietnam depends on the number of employees who are not covered by health insurance. The minimum fine is 1,000,000 VND and the highest is 40,000,000 VND. In addition, this enterprise is also forced to refund the amount of money that the insured has suffered and is forced to pay the illegal profits.

Best Regards!