Labor Policy - Insurance effective from mid-December 2018

Labor Policy - Insurance effective from mid-December 2018
Nguyen Trinh

From mid-December 2018 (from December 15, 2018, to December 31, 2018), many new policies start to take effect. Thu Ky Luat respectfully introduces to esteemed Members and Customers some policies on Labor, Social Insurance, etc., as follows:

  1. Adjustments to Retirement Pensions for Female Workers Retiring from 2018-2021

This is a notable content in Decree 153/2018/ND-CP issued by the Government of Vietnam on November 7, 2018.

To be specific, Decree 153 stipulates policies to adjust retirement pensions for female workers who begin receiving retirement pensions from January 1, 2018, to December 31, 2021, and who have paid social insurance premiums for between 20 years and 29 years 6 months, affected more adversely compared to male workers due to changes in the calculation of retirement pensions as per the Law on Social Insurance 2014 compared to the Law on Social Insurance 2006.

Depending on the period during which social insurance premiums have been paid and the starting date of receiving the retirement pension:

Adjusted retirement pension = Retirement pension calculated according to Clause 2, Article 56, or Clause 2, Article 74 of the Law on Social Insurance 2014 + Adjustment amount

Whereby: Adjustment amount = Retirement pension calculated at the time of starting to receive the pension x Adjustment rate. The adjustment rate is detailed in the Table under Clause 2, Article 3 of Decree 153.

The adjusted retirement pension is the basis for calculating adjustments in subsequent pension adjustments as provided in Article 57 of the Law on Social Insurance 2014.

Note: The time of implementing the adjustment is calculated from the month the female worker begins receiving the retirement pension.

Decree 153/2018/ND-CP is effective from December 24, 2018.

  1. New Regulations on Wages During Public Holidays for Employees

On October 8, 2018, the Government of Vietnam issued Decree 148/2018/ND-CP amending and supplementing some articles of Decree 05/2015/ND-CP, which details and guides the implementation of some contents of the Labor Code.

Starting from December 15, 2018, the wage used as the basis for payment to employees on annual leave as stipulated in Article 111; on additional annual leave due to seniority as stipulated in Article 112; on public holidays as stipulated in Article 115; and on personal leave with pay as stipulated in Clause 1, Article 116 of the Labor Code 2012 is the wage from the labor contract (previous regulation was the wage recorded in the labor contract of the preceding month), divided by the number of normal working days in the month according to the employer's regulations, multiplied by the number of days of annual leave, additional annual leave due to seniority, public holidays, and personal leave with pay.

Simultaneously, Decree 148 also adds regulations on wages used as the basis for compensation when unilaterally terminating the labor contract illegally as stipulated in Clause 5, Article 42, or Clause 2, Article 43 of the Labor Code 2012, which is the wage as per the labor contract at the time the employer or employee unilaterally terminates the labor contract illegally.

  1. Special Allowance Levels for the Guard Force from December 26, 2018

Recently, the Ministry of Defense issued Circular 162/2018/TT-BQP guiding policies on special allowances for the Guard Force under the Ministry of Defense.

The following subjects are entitled to one of the four special allowance levels, which include: 30%, 25%, 20%, and 15% calculated on the salary grade wage for officers or types, groups, and ranks for professional officers:

- Officers, professional soldiers in the Guard Division of the Army Security Protection Bureau, General Political Department;- Officers, professional soldiers assigned by competent authorities to reinforce tasks according to positions specified at the Guard Division of the Army Security Protection Bureau, General Political Department for a period of 01 month or more.

The special allowance is calculated according to the following formula:

Special allowance = Salary grade wage of the rank or type, group, and rank x Statutory pay rate x Applicable special allowance percentage

Whereby: The statutory pay rate is implemented according to regulations of the Government of Vietnam at each time.

For details: Circular 162/2018/TT-BQP takes effect on December 26, 2018.

  1. List of Prohibited Import-Export Scrap from December 20, 2018, to December 31, 2019

This is the basic content stipulated in Circular 41/2018/TT-BCT regarding the list of scrap temporarily halting business operations concerning temporary import for re-export, transfer, with effect from December 20, 2018.

From December 20, 2018, to December 31, 2019, enterprises will temporarily halt the import, export, and transfer activities for the scraps listed in the Scrap List issued together with Circular 41, such as:

- Gypsum; anhydrite; plaster (including plaster that has been roasted or sulphate of calcium that has been roasted), whether colored or not, whether having a small amount of catalysts or inhibitors;- Waste and scrap of paper or paperboard;- Waste and scrap of iron; cast iron ingots from re-melting waste and scrap of iron or steel;- …

Please note:

- This scrap list does not apply to transshipment business in the form of goods being transported directly from the export country to the import country without passing through Vietnamese ports.- For scrap shipments that have completed customs procedures for temporary import, transfer before December 20, 2018, the re-export and transfer shall continue to be carried out according to the provisions of Decree 69/2018/ND-CP.

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