From January 01, 2016: New guidelines on compulsory social insurance in Vietnam

For convenience in reference, here is the summary of the key points of Decree No. 115/2015/ND-CP of Vietnam’s Government:

1. Clarifying the definition of Vietnamese guest workers:

Clause 2 Article 2 of Decree No. 115/2015/ND-CP stipulates that Vietnamese guest workers prescribed in the Law on Vietnamese guest workers participating compulsory social insurance shall apply the following contracts:

- The guest worker contracts concluded with enterprises providing guest worker services or with non-business organizations licensed to send workers abroad;

- The guest worker contracts concluded with contract-winning or -receiving enterprises or with outward-investing organizations or individuals that send workers abroad;

- The guest worker contracts in the form of skill-improvement internship contracts, concluded with enterprises sending workers abroad for internship to improve their skills;

- Individual contracts.

2. Regulating maternity benefits

Chapter II of Decree No. 115/2015/ND-CP supplements contents to detail maternity benefit for female employees as surrogate mothers and intended mothers, specifically as follows:

For female employees as surrogate mothers

- Each female employee as surrogate mother (hereinafter referred to as the surrogate mother) who is contributing to the fund of sickness and maternity of the compulsory social insurance shall be entitled to take leaves for 5 prenatal check-ups, one day for each check-up; the employee who lives far from health facilities or have pathological signs or abnormal pregnancy is entitled to take a two-day leave for each prenatal check-up. Moreover, each surrogate mother who is contributing to the fund of sickness and maternity of the compulsory social insurance shall be entitled to take a maternity leave as prescribed by a competent health establishment when getting miscarriage, abortion, stillbirth or pathological abortion. The maximum leave period shall be from 10 days to 50 days depending on each specific case.

- Be entitled to a lump-sum benefit and maternity leave until the time of relinquishing the child to the intended mother, with the leave period not exceeding 6 months in case of giving birth to 1 child.

- The maternity benefit levels for the surrogate mother shall be implemented in the same manner as for other female employees giving birth normally.

If the intended mother has paid compulsory social insurance to the fund of sickness and maternity for 6 months or longer within 12 months until the time of receiving the child, she is entitled to the following regimes:

- A lump-sum payout equaling 2-month base salary for each child in the month of childbirth if the surrogate mother fails to pay compulsory social insurance premiums or satisfy requirements for enjoying benefits.

- If the surrogate mother and the intended mother do not pay compulsory social insurance or do not satisfy requirements as prescribed, the husband of the intended mother, who is paying compulsory social insurance to the fund of sickness and maternity shall be entitled to a lump-sum payout equaling 2-month base salary in the month of childbirth.

- Taking maternity leave from the time of receiving the child until the child is 6 months of age. If the intended mother has twins or more infants, she is entitled to an additional leave of 1 month for each infant from the second child.

If the intended mother does not take leave, she is entitled to not only his/her salary but also the maternity benefit as prescribed.

3. Monthly salary as the basis for compulsory social insurance payment

Article 17 of Decree No. 115/2015/ND-CP further specifies that for each employee who pays social insurance premiums according to the salary regime by the employer, his monthly salary as the basis for social insurance payment shall be determined as follows:

- From January 01, 2016 to December 31, 2017, the monthly salary as the basis for social insurance payment will be the salary plus salary-based benefit mentioned in the labor contract as prescribed in the labor law.

- From January 01, 2016 to December 31, 2017, the monthly salary as the basis for social insurance payment will be the salary plus salary-based benefit mentioned in the labor contract as prescribed in the labor law.

- The monthly salary as the basis for social insurance payment applied to each enterprise management receiving salary will be the salary decided by the enterprise.

4. Collection of monthly salary as the basis for compulsory social insurance payment in arrears

Decree No. 115/2015/ND-CP specifies that the monthly salary as the basis for compulsory social insurance payment in arrears applied to employees and employers shall be collected in any of the following cases:

- Increasing the monthly salary of an employee as the basis for social insurance payment.

- Making supplementary payment of social insurance which has not been paid by a guest worker.

Regarding the cases prescribed above, the arrear amount shall not be charged the late-payment interest. After 6 months from the date on which the decision on increase in monthly salary as the basis for social insurance payment or termination of the guest worker labor contract, the social insurance in arrears shall include the compulsory social insurance payable as prescribed and charged interest.

5. Converting salaries in foreign currency into Vietnamese dong for social insurance payment

Decree No. 115/2015/ND-CP supplements new contents in Article 26, according to which each employee having salary mentioned in the labor contract in foreign currency, the social insurance payment and social insurance recording shall be carried out as follows:

- The monthly salary as the basis for social insurance payment in VND by converting the salary in foreign currency into VND according to the average exchange rate on the inter-bank foreign exchange market announced by the State bank of Vietnam on every January 02 and July 01.

- Monthly salary as the basis for social insurance payment mentioned in the social insurance book is the salary in VND.

6. Eligibility applied to employees for social insurance benefits before January 01, 2016

According to Article 28 of Decree No. 115/2015/ND-CP, each female employee giving birth or each employee adopting an under-6-month child before January 01, 2016 shall be eligible for benefits prescribed in regulations promulgated before January 01, 2016.

7. Effect

Decree No. 115/2015/ND-CP takes effect from January 01, 2016, other than the regulation on persons working under labor contracts with a term of between full of 1 month and under 3 months which takes effect from January 01, 2018.

Source: Thoi bao Kinh te Sai Gon

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