Insurance for employees

Insurance for employees

Social Insurance is the guarantee which exchanging or compensating a part of income of employees when their income are reduced or lost because of the sickness, maternity, industrial accident, retirement or death, based on the payment to the social insurance fund. Depending ton the time that an enterprise register to pay social insurance for its employees. HNLaw & Partners would like to guide Customer to as follows:

Legal bases:

  • Law on Social Insurance 2014 (Hereafter referred as “Law on IS”)
  • Decision promulgate procedures for collection of social insurance contributions and premiums of health insurance, unemployment insurance, occupational accident and occupational disease insurance; management of social insurance books and health insurance cards (Hereafter referred as “QD 595/QD-BHXH”)

Contents

  1. Subjects of Social Insurance participation in enterprises (Article 2 Law on Social Insurance Decision 595/QD-BHXH)

Subjects of Social Insurance participation:

  • Persons working under indefinite-term labor contracts, definite-term labor contracts, seasonal labor contracts or contracts for given jobs with a term of between full 3 months and under 12 months, including also labor contracts signed between employers and at-law representatives of persons aged under 15 years in accordance with the labor law;
  • Persons working under labor contracts with a term of between full 1 month and under 3 months;
  •  Salaried managers of enterprises and cooperatives;
  • Part-time staffs in communes, wards and townships;
  • Employees who are foreign citizens working in Vietnam with work permits or practice certificates or practice licenses granted by competent Vietnamese agencies

2. Level of Social Insurance payment

Subjects Ratio 
Social Insurance Medical Insurance Unemployment Insurance Total 
Retirement, death Sickness Industrial accident 
Enterprises 14% 3% 0,5% 3% 1% 21,5%
Employees 8% 1,5% 1% 10,5%
Total 32%

3. Methods of social insurance payment (Article 31 QD 595/QD-BHXH)

  • An employer makes a monthly, quarterly or biannual payment based on its payment method, the employer shall deduct a prescribed rate of its employees’ salaries to transfer it to the collecting account opened by the social insurance authority.
  • A Vietnamese guest worker under labor contract paying insurance contributions or premiums through his/her employer and a worker who has his/her labor contract extended or signs a new labor contract at the receiving country who shall pay insurance contributions and premiums after returning home shall make a payment to the social insurance authority or the authority receiving his/her application for payment of insurance contributions and premiums.

4. Penalties of administrative violations to actions relating to social insurances payment

According to the provision of Clause 19 Article 1 Decree 18/2015/NĐ-CP: “Warnings or fines of from VND 500,000 to VND 1,000,000 for shall be imposed upon any worker who colludes with the employer to avoid paying compulsory social insurance, unemployment insurance, or to avoid paying sufficiently.”.

According to Article 26 Decree 95/2013/NĐ-CP stipulated on the penalties of administrative violations in labor, social insurances and overseas manpower supply by contract

  • The employer shall be liable to a fine of 12% – 15% of the compulsory social insurance and unemployment insurance premium but not exceeding 75,000,000 VND at the time the administrative violation is recorded upon committing one of the following acts:

+ Failing to pay compulsory social insurance premium and unemployment insurance premium on schedule;

+ Failing to pay sufficient social insurance premium and unemployment insurance premium;

+ Failing to buy compulsory social insurance and unemployment insurance for all the people that must have social insurance and unemployment insurance.

  • The employer shall be liable to a fine of 18% – 20% of the compulsory social insurance and unemployment insurance premium but not exceeding 75,000,000 VND at the time the administrative violation is recorded when failing to buy compulsory social insurance and unemployment insurance for all the workers that must have social insurance and unemployment insurance.
  • Remedial methods:

+ Compelling the payment of the omitted or deferred compulsory social insurance premium and unemployment insurance premium

+ Compelling the payment of the interest on the omitted and deferred  compulsory social insurance and unemployment insurance premium based on the interest level of the investment activity of Social Insurance Fund of the year.

Above is the consulting contents on “Social Insurance for employees” of HNLaw & Partners. Customer who has any question or demand to use legal services please contact directly to Company for more detailed consulting and best support.

For more details please contact:

HNLAW & PARTNERS LAW FIRM

Address: DBS Building, No. N028, lot 31, Ha Tri Commerce and Housing Service Area, Ha Tri Ward, Ha Dong, Ha Noi

Email: tuvan.hnlaw@gmail.com

Hotline: 0912.918.296

http://www.hnlaw.vn/en/enterprise-consultancy/

https://en.wikipedia.org/wiki/Insurance

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