Proposal on subjects covered by compulsory and voluntary social insurance in Vietnam

Proposal on subjects covered by compulsory and voluntary social insurance in Vietnam (Internet image)

Regarding this matter, LawNet would like to answer as follows: 

1. What is social insurance?

Social insurance is the assurance to replace or compensate for a portion of the income of workers due to sickness, maternity, work-related accidents, occupational diseases, retirement age, or death.

- Compulsory social insurance means a form of social insurance organized by the State in which employees and employers are required to participate.

- Voluntary social insurance means a form of social insurance organized by the State in which a participant has the right to voluntarily participate, select a premium rate, and choose a method of premium payment suitable to his/her income.

(Articles 1, 3, 4 of the Draft Law on Social Insurance (amended))

2. Proposal on subjects covered by compulsory and voluntary social insurance in Vietnam

2.1. Proposal on subjects covered by compulsory social insurance in Vietnam

Based on Articles 1, 2, and 3 of the Draft Law on Social Insurance (amended), the proposed subjects covered by compulsory social insurance in Vietnam include:

[1] Vietnamese citizens who are obligated to participate in social insurance, including:

- Workers under indefinite-term labor contracts, fixed-term labor contracts lasting at least 1 month, regardless of whether the two parties have entered into a labor contract or reached an agreement under a different name but with content reflecting paid employment, wages, and the supervision, management, and control of one party, excluding probation contracts as regulated by labor law.

- Officials, and public employees.

- Workers and public employees in defense industry enterprises, police officers, and those working in other essential organizations.

- Professional soldiers in the People's Army, professional officers, officers specialized in professional tasks, officers and non-commissioned officers specialized in technical fields of the People's Public Security, and those working in essential positions receiving salaries similar to military personnel.

- Non-commissioned officers and soldiers of the People's Army, officers and soldiers of the People's Public Security serving for a limited period, military, police, and essential trainees receiving living allowances, and active people's militias.

- Individuals working abroad under contracts as regulated by the Law on Vietnamese Guest Workers.

- Individuals not receiving salaries from the state budget and following their spouses working at Vietnamese agencies abroad.

- Business managers, auditors, representatives of state capital, representatives of capital in companies and parent companies, managers of cooperative alliances, cooperative unions enjoying salaries.

- Non-professional workers at the commune level, in villages, and residential areas.

- Workers as regulated in point a, clause 1, Article 3 of the Draft Law on Social Insurance (amended), working part-time, with monthly wages equal to or higher than the minimum required for compulsory social insurance contributions as stipulated in point e, clause 1, Article 30 of the Draft Law on Social Insurance (amended).

- Household business owners subject to business registration.

- Business managers, auditors, representatives of state capital, representatives of capital in companies and parent companies, managers of cooperative alliances, and cooperative unions are not receiving salaries.

[2] Foreign citizens working in Vietnam who are obligated to participate in social insurance when they have a work permit, professional certificates, or business licenses issued by competent authorities in Vietnam and have fixed-term labor contracts lasting at least 12 months with employers in Vietnam, except for the following cases:

- Internal mobility within enterprises.

- At the time of concluding the labor contract, the worker has reached the retirement age as regulated in Article 169, Clause 2 of the Labor Code 2019.

- Belonging to the subjects regulated by international conventions that Vietnam has signed and participated in with different regulations.

[3] Employers who are obligated to participate in social insurance include state agencies, public-sector units; military, police, and essential organizations; political organizations, political-social organizations, socio-professional organizations, social-professional organizations, other social organizations; foreign organizations, international organizations operating in Vietnamese territory; enterprises, cooperative unions, cooperatives, household businesses, cooperative groups, other organizations, and individuals hiring and employing workers under labor contracts.

2.2. Proposal on subjects covered by voluntary social insurance in Vietnam

Based on Article 3, Clause 4 of the DDraft Law on Social Insurance (amended), the proposed subjects covered by voluntary social insurance in Vietnam include:

- Vietnamese citizens aged 15 and above who are not included in the compulsory social insurance participants mentioned in Section 2.1. In cases where the individuals mentioned in point a, point b, Clause 1 of Article 3 of the Draft Law on Social Insurance (amended) are temporarily suspended from executing labor contracts or work contracts, they are eligible to participate in voluntary social insurance.

3. Proposal for application for compulsory and voluntary social insurance in Vietnam

- Compulsory social insurance documentation includes:

+ Declaration of social insurance participation by the employer, accompanied by a list of employees participating in social insurance.

+ Declaration of social insurance participation by each employee.

- Voluntary social insurance documentation includes a Declaration of social insurance participation by the employee.

(Article 26 of the Draft Law on Social Insurance (amended))

Translated by Dương Thị Hoài Nhi

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