Công văn 2446/BHXH-QLT

To: Employers in Ho Chi Minh City.

Pursuant to Government's Decree No. 143/2018/ND-CP dated October 5, 2018 on guidelines for the Law on Social Insurance and the Law on Occupational Safety and Hygiene in terms of compulsory social insurance applied to employees who are foreign citizens working in Vietnam.

Ho Chi Minh City Social Security provides temporary guidelines on participation of compulsory social insurance applied to employees who are foreign citizens working in Vietnam as follows:

1. Required entities:

1.1. An employee who is a foreign citizen working in Vietnam is required to participate in compulsory social insurance when he/she obtains a work permit or practicing certificate or license issued by the Vietnamese competent authority and has an indefinite-term labor contract or a labor contract with the term of at least 1 year entered into with an employer in Vietnam.

1.2. An employee is not required to participate in compulsory social insurance if he/she falls under one of the following:

- He/she is transferred within his/her enterprise as prescribed in Clause 1 Article 3 of the Government’s Decree No. 11/2016/ND-CP dated February 3, 2016 and: he/she is the manager, executive officer, expert and technical worker of a foreign enterprise which has commercial presence in Vietnam’s territory, or he/she is temporarily assigned within his/her enterprise to the commercial presence in Vietnam’s territory and has been recruited at least 12 months before by the foreign enterprise.

- He/she reaches his/her full retirement age as prescribed in Clause 1 Article 187 of the Labor Code.

1.3. An employee who enters into multiple labor contracts with different employers and is required to participate in compulsory social insurance may only make social insurance contributions for the first labor contract; the employer must make contributions to occupational accident or disease insurance fund according to every signed labor contract.

2. Contribution rates:

2.1. From December 1, 2018:

According to the employee's monthly salary on which the contributions to social insurance are based, the employer shall contribute:

- 3% to the sickness and parental benefit fund;

- 0.5% to the occupational accident or disease insurance fund.

2.2. From January 1, 2022:

Employer’s monthly contribution:

- 3% to the sickness and parental benefit fund;

- 0.5% to the occupational accident or disease insurance fund.

- 14% to the pension and survivor benefit fund.

Employee’s monthly contribution: 8% to the pension and survivor benefit fund.

3. Monthly salary for social insurance contribution:

Monthly salary for social insurance contribution includes the pay, allowances and other amounts prescribed in Article 30 of Circular No. 59/2015/TT-BLDTBXH dated December 29, 2015 of the Ministry of Labor, War Invalids and Social Affairs.

4. Benefits:

4.1. From December 1, 2018:

- Sickness benefit: in compliance with Article 6 of Decree No. 143/2018/ND-CP.

- Parental benefit: in compliance with Article 7 of Decree No. 143/2018/ND-CP.

- Benefits of occupational accident or disease insurance: in compliance with Article 8 of Decree No. 143/2018/ND-CP.

4.2. From January 1, 2022:

Apart from the social insurance benefits prescribed in Point 4.1, employees and relatives of employees are also eligible for the following benefits:

- Pension: in compliance with Article 9 of Decree No. 143/2018/ND-CP.

- Lump-sum social insurance payout: in compliance with Clause 6 Article 9 of Decree No. 143/2018/ND-CP.

- Survivor benefit: in compliance with Article 10 of Decree No. 143/2018/ND-CP.

- Conversion of social insurance benefits applied to people on pension, monthly social insurance subsidies# who have no longer resided in Vietnam: in compliance with Article 11 of Decree No. 143/2018/ND-CP.

5. Procedures:

- From December 1, 2018, social security agencies will transfer all foreigners who have participated in the health insurance with the code BW to code IC for participation in social insurance or health insurance. In a case where a foreigner falls under Point 1.2 Clause 1 as above, the foreigner’s employer shall make an electronic dossier receipt No. 600 to decrease the number order of code IC and dossier receipt No. 603 to increase the number order of code BW.

- The employers shall declare dossiers and follow procedures in accordance with applicable regulations with the participation code converted from BW to IC.

For example: An employer which has been issued with the code BW0001Z by the social security agency for health insurance participation of its foreign employees will be issued with code IC0001Z from December 1, 2018.

When making a payment order or remittance bill, the employer must insert all 3 items: employer’s name, code, and payment details. If the employer makes a document for multiple codes (such as: YN, IC, BW), it must specify the specific amounts of payments equivalent to each code in the payment details.

Relevant entities are required to cooperate with Ho Chi Minh City Social Security in make contributions of social insurance and health insurance for foreigners as per the law.