Clarification of Unemployment Insurance and Severance Allowance for Employees in Vietnam

17:50, 10/07/2024

The Ministry of Labor, War Invalids and Social Affairs of Vietnam issued Official Dispatch 585/LDTBXH-PC to address some concerns regarding unemployment insurance, severance allowances for employees, employees unilaterally terminating labor contracts unlawfully, and the annual leave schedule.

The contents explained by the Ministry of Labor, War Invalids and Social Affairs of Vietnam (MOLISA) are as follows:

Content	Explanation	Legal Basis
Subjects participating in unemployment insurance	Employees (ELs) working under probationary contracts, taking leave to enjoy maternity or sickness benefits for 14 working days or more without receiving monthly salaries from the unit, but receiving social insurance allowances, will not be subject to unemployment insurance participation during this period.	- Clause 1, Article 43, Employment Law 2013 - Article 11, Decree 28/2015/ND-CP
Time to calculate severance allowance	Employers (ERs) are responsible for paying severance allowances to ELs who have regularly worked for 12 months or more; the time ELs worked under probationary contracts, the time ELs took leave to enjoy maternity or sickness benefits for 14 working days or more without receiving monthly salaries from the enterprise but receiving social insurance allowances will be counted as actual working time to enjoy severance allowance.	- Article 48, Labor Code 2012 - Article 14, Decree 05/2015/ND-CP - Article 11, Decree 28/2015/ND-CP
Employee unilaterally terminates labor contract (LLC) illegally	It is when ELs exercise the right to unilaterally terminate LLC contrary to the provisions in Clause 1, Article 37, or contrary to the notice period in Clause 2, Article 37, or contrary to both Clause 1 and 2, Article 37 of the Labor Code 2012. When ELs unilaterally terminate LLC illegally, they must fulfill the obligations stipulated in Article 43 of the Labor Code 2012. If ELs do not fulfill compensation obligations, ERs can bring labor disputes to the competent authorities as per Section 2, Chapter XIV of the Labor Code 2012.	Clauses 1 + 2, Article 37, Article 43, Section 2, Chapter XIV, Labor Code 2012
Handling disciplinary dismissal	When employees voluntarily leave work for 5 cumulative days in a month or 20 cumulative days in a year without a legitimate reason, the ER has the right to apply the form of disciplinary dismissal. Employees dismissed do not fall under cases of employees unilaterally terminating LLCs.	Clause 3, Article 126, Labor Code 2012
Annual leave	If the company wants to change the annual leave schedule according to the announced plan for employees, the company must consult again with employees and notify them in advance of the changed annual leave schedule.	Clause 2, Article 111, Labor Code 2012

The above responses are included in Official Dispatch 585/MOLISA-PC by the Ministry of Labor, War Invalids and Social Affairs addressing queries for UNISOLL VINA Co., Ltd.

Refer to the details in Official Dispatch 585/MOLISA-PC.

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