Regulations on Region-based allowance applicable to persons eligible for social insurance payout in Vietnam

Regulations on Region-based allowance applicable to persons eligible for social insurance payout in Vietnam (Internet image)

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

1. Subjects eligible for social insurance payout of application of region-based allowance in Vietnam

Subjects eligible for social insurance payout of application of region-based allowance according to Clause 1, Article 21 of Decree 115/2015/ND-CP are as follows:

- Employees ceasing work that are eligible for a pension or a lump-sum social insurance payout or die from January 1, 2016 and have paid social insurance including region-based allowance before January 1, 2007;

- Persons on monthly pension, working capacity loss benefit, labor accident or occupational disease benefit before January 1, 2016 who is on region-based allowance at their permanent residence.

2. Region-based allowance applicable to persons eligible for social insurance payout in Vietnam

Region-based allowance applicable to persons eligible for social insurance payout according to Clause 2, Article 21 of Decree 115/2015/ND-CP is as follows:

- Each employee ceasing work who is eligible for a pension or a lump-sum social insurance payout from January 1, 2016 and has paid social insurance including region-based allowance, shall be entitled to receive, apart from pension and a lump-sum social insurance payout as prescribed, a lump-sum benefit corresponding to his/her payment period and premiums for region-based allowance in the social insurance.

If an employee having paid social insurance including region-based allowance dies from January 1, 2016 without receiving pension or a lump-sum social insurance payout, his/her relatives shall be entitled to receive both survivor benefit as prescribed and a lump-sum benefit corresponding to the payment period and premiums for region-based benefit in the social insurance.

- Persons on monthly pension, working capacity loss benefit, labor accident or occupational disease benefit before January 1, 2016 who is on region-based allowance at their permanent residence shall be continue receiving their current allowance (not adjusting according to the base salary) until there are new regulations promulgated by the Government.

A person on monthly pension, working capacity loss benefit, labor accident or occupational disease benefit before January 1, 2016 who is on region-based allowance at his/her permanent residence but moving to another permanent residence shall be eligible for new region-based allowance from January 1, 2016;

If the new permanent residence not eligible for region-based allowance, he/she may not receive any region-based allowance.

A person on monthly pension, working capacity loss benefit, labor accident or occupational disease benefit before January 1, 2016 who is not on region-based allowance at his/her permanent residence but moving to another permanent residence eligible for new region-based allowance from January 1, 2016; he/she still may not receive any region-based allowance.

3. Determination of lump-sum benefit in Vietnam

The determination of lump-sum benefit in Vietnam according to Clause 3, Article 21 of Decree 115/2015/ND-CP is as follows:

Regarding the case prescribed in Point a Clause 2 of Article 21 of Decree 115/2015/ND-CP, the lump-sum benefit shall be determined according to the period, rate of premiums paid to the fund of retirement and survivorship, coefficient of region-based allowance and the base salary at the payout time. The coefficient of region-based allowance shall be determined as follows:

- Regarding the payment period from January 1, 1995 to December 31, 2006, the coefficient of region-based allowance as the basis for determination of the lump-sum benefit is the actual coefficient of region-based as the basis for the social insurance payment;

- Regarding the working period before January 1, 1995, the coefficient of region-based allowance shall be determined according to each province and organization as prescribed in law on region-based allowance;

- Regarding the serving period at the battlefield B, C before April 30, 1975 and at the battlefield K before August 31, 1989, the coefficient of region-based allowance of 0.7 for lump-sum allowance shall apply.

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