The social insurance contribution rate for employees in 2019 in Vietnam

According to Decision 595/QD-BHXH, currently, there are a total of 03 types of insurance that businesses must pay for their employees, including: Social insurance (retirement, sickness, maternity), health insurance, and unemployment insurance.

The specific contribution rates for these insurances are as follows:

1. For Vietnamese employees

2. For foreign employees

Thus, monthly, employers must independently pay and deduct from employees' wages to pay insurance contributions for Vietnamese employees at a total rate of 32% of the salary used to calculate social insurance contributions and 8% of the salary used to calculate social insurance contributions for foreign employees.

Basis for the salary used to calculate insurance contributions

From January 1, 2018, onwards, the monthly salary used for compulsory social insurance contributions includes the salary, salary allowances, and other additional amounts. To be specific:

- Salary, recorded according to the salary scale, salary table formulated by the employer following labor law regulations and agreed upon by both parties. For employees receiving pay on a product or contract basis, record the time-based salary to determine the product price or contract basis salary;

- Salary allowances to compensate for factors related to working conditions, job complexity, living conditions, and the degree of labor attraction that the agreed-upon salary in the labor contract has not yet considered or has only partially considered;

- Additional amounts that are specified specifically alongside the agreed-upon salary in the labor contract and paid regularly in each wage period.

Note: The monthly salary used for compulsory social insurance contributions does not include other types of policies and benefits such as bonuses as regulated in Article 103 of the Labor Code, initiative bonuses; meal allowances; allowances for transportation, phone bills, travel, housing, childcare, and small children; support when employees have deceased relatives, employee’s relatives getting married, the employee’s birthday, allowances for employees encountering difficulties due to work accidents or occupational diseases, and other support allowances recorded in a separate item in the labor contract as per Clause 11 Article 4 of Decree 05/2015/ND-CP.

- Nguyen Trinh -

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