When to pay unemployment insurance in Vietnam?

Unemployment insurance addresses many issues, both for employees and for the economy at large. The most apparent benefit is maintaining income for employees, providing them with funds to cover daily living expenses during unemployment. Secondly, if employees have no income, it will lead to a significant decrease in the revenue of certain goods, causing business losses, economic downturn, and further unemployment.

The most basic principle of insurance is risk-sharing; unemployment insurance operates under the same principle. When employees contribute to the Unemployment Insurance Fund, they will receive partial income compensation when they lose their jobs, support for vocational training, job maintenance, and job seeking (according to Clause 4, Article 3 of the Employment Law 2013).

According to the provisions of this Law, employees participate in unemployment insurance when working under the following labor contracts or employment contracts:

- Labor contract or employment contract of indefinite duration;

- Labor contract or employment contract of definite duration;

- Seasonal labor contract or specific job contract with a term of between 03 months and less than 12 months.

It should be noted that employees who are receiving pensions or are domestic helpers are not required to participate in unemployment insurance. In cases where employees have entered into and are performing multiple labor contracts, the worker and the employer of the first labor contract entered into are responsible for participating in unemployment insurance.

Thus, unemployment insurance is a very useful policy that provides maximum support for employees participating in social insurance but are unemployed during a job transition period or currently unemployed. In the aforementioned cases, employees are mandated to participate in unemployment insurance. This is also for the benefit of the employees.

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