A series of documents and regulations in Vietnam will officially come into effect in 2021. Among these, the regulations on retirement and pension will also undergo many changes.
Article table of contents
Vietnam: From 2021, regulations on retirement and pension will undergo many changes (Illustrative image)
1. Increase in retirement age for male and female employees in Vietnam
From January 1, 2021, the Labor Code 2019 officially takes effect. The retirement age of employees under normal working conditions will be adjusted according to a roadmap until reaching 62 years for male employees by 2028 and 60 years for female employees by 2035. The detailed retirement age roadmap for employees is stipulated in Decree 135/2020/ND-CP.
From 2021, the retirement age of employees under normal working conditions is specified as follows:
- The retirement age of male employees is 60 years and 3 months instead of 60 years as currently;
- The retirement age of female employees is 55 years and 4 months instead of 55 years as currently.
After that, each year, it will increase by three months for male employees and 04 months for female employees.
2. Change in conditions for receiving pension
Decree 135/2020/ND-CP stipulates that from January 1, 2021, the conditions for receiving pension under Article 6 of Decree 115/2015/ND-CP will be annulled. At the same time, the following regulations are amended and supplemented:
- Regulation on conditions for receiving pension under Article 54 of the Law on Social Insurance 2014;
- Regulation on conditions for receiving pension when reduced capacity to work under Article 55 of the Law on Social Insurance 2014;
- Regulation on conditions for receiving pension when participating in voluntary social insurance under Clause 2 Article 73 of the Law on Social Insurance 2014.
The conditions for receiving pension in 2021 will be based on the following regulations:
- Article 169, Clause 1 Article 219 of the Labor Code 2019;- Decree 135/2020/ND-CP.
Employees working under normal working conditions are eligible for pension if:
(1) They have paid social insurance premiums for 20 years or more; and
(2) They meet the retirement age stipulated in Clause 2 Article 169 of the Labor Code 2019:
- For male employees is 60 years and 3 months;
- For female employees is 55 years and 4 months.
3. Change in the period of social insurance premium payment for male employees to receive pension
According to Point a Clause 2 Article 56 and Point a Clause 2 Article 74 of the Law on Social Insurance 2014, the monthly pension of employees is calculated at 45% of the average monthly salary serving as the basis for social insurance premium payment and corresponds to the number of years of social insurance premium payment. To be specific:
- Male employees retiring in 2018 is 16 years, in 2019 is 17 years, in 2020 is 18 years, in 2021 is 19 years, and from 2022 onwards is 20 years;
- Female employees retiring from 2018 onwards is 15 years.
After that, for each additional year, employees will be entitled to an additional 2%; with a maximum of 75%.
Thus, if retiring in 2021, the number of years of social insurance premium payment required for male employees to receive the pension is 19 years (an increase of 1 year compared to 2020).
Above are the 3 notable changes regarding retirement and pension from January 1, 2021 that employees need to pay attention to to best protect their rights.
Thuy Tram
