6 major changes in social insurance policy will take effect from July 1, 2025

This morning, June 29, at the 7th session, the 15th National Assembly passed the Law on Social Insurance (amended) with 454/465 delegates participating in the vote in favor, equal to 93.42% of the total number of National Assembly delegates.

Compared with the 2014 Law on Social Insurance, the Law on Social Insurance (amended) has many changes in the direction of increasing rights and benefits in enjoying policies to attract employees to participate in social insurance, ensuring long-term social security for the people.

1. Expanding the audience

The Law on Social Insurance (amended) this time has basically institutionalized Resolution No. 28/NQ-TW, stipulating the expansion of subjects participating in compulsory social insurance to 4 groups: Business owners participating according to Government regulations; Enterprise managers, controllers, representatives of state capital, representatives of enterprise capital at companies and parent companies according to the provisions of the Enterprise Law; members of the Board of Directors, General Directors, Directors, members of the Board of Supervisors or controllers and other elected management positions of cooperatives and cooperative unions according to the provisions of the Law on Cooperatives who do not receive salaries; Part-time employees whose monthly salary is equal to or higher than the lowest salary used as the basis for compulsory social insurance; In cases where employees and employers agree on a different name but the content shows the paid work, salary and management, operation and supervision of one party...

In addition, in order to gradually move towards a compulsory social insurance policy for all workers with jobs, income and salary when meeting the necessary conditions in the spirit of Resolution No. 28-NQ/TW, the Law stipulates that the Standing Committee of the National Assembly shall decide on compulsory social insurance participation for other subjects with stable and regular jobs and income based on the Government's proposal in accordance with the economic and social development conditions of each period.

The addition of the above provision ensures compliance with the provisions of the 2019 Labor Code, while ensuring increased benefits when participating groups contribute to increasing the coverage of social insurance.

2. Supplement social pension benefits

The Law on Social Insurance (amended) has added Chapter III on social pension benefits. Accordingly,Vietnamese citizens aged 75 or older who do not have a monthly pension or social insurance allowance (except in other cases as prescribed by the Government) or Vietnamese citizens aged 70 to under 75 who are from poor households or near-poor households and meet the prescribed conditions shall receive social pension allowances guaranteed by the State Budget.

The Law on Social Insurance (amended) also stipulates that based on the Government's proposal in accordance with socio-economic development conditions and the capacity of the state budget in each period, the Standing Committee of the National Assembly decided to gradually reduce the age of receiving social pension benefits.

The monthly social pension allowance level is determined by the Government in accordance with the socio-economic development conditions and the capacity of the state budget in each period. Every 3 years, the Government reviews and considers adjusting the social pension allowance level. Depending on the socio-economic conditions, the ability to balance the budget, and mobilize social resources, the People's Committee at the provincial level shall submit to the People's Council at the same level a decision on additional support for social pension beneficiaries.

The Law on Social Insurance (amended) also supplements regulations on the regime for employees who are not eligible for pension and are not old enough to receive social pension benefits. Accordingly, Vietnamese citizens who are old enough to retire and have paid social insurance but are not eligible for pension (not yet 15 years of payment) and are not eligible for social pension benefits, if they do not receive a one-time social insurance payment or do not reserve it but have a request, they will receive monthly benefits from their own contributions. The duration and level of monthly benefits are determined based on the employee's social insurance payment period and basis.

People receiving monthly social pension benefits have their health insurance paid for by the State budget according to the provisions of the law on health insurance. When they die, the organization or individual in charge of the funeral will receive support for funeral expenses according to the provisions of the law on the elderly.

3.Reduce the eligibility for monthly pension from 20 years to 15 years

The Law on Social Insurance (amended) stipulates that employees who reach retirement age and have paid social insurance for 15 years or more are entitled to receive a monthly pension. This provision is intended to create opportunities for late participants or those who participate intermittently to accumulate 15 years of contributions (instead of 20 years as currently prescribed) to receive a monthly pension instead of having to receive a lump sum social insurance payment. This provision on the minimum number of years of contributions does not apply to pensioners with reduced working capacity.

The Law on Social Insurance (amended) also stipulates the pension rate for male and female workers with 15 years of social insurance contributions, stipulating the maximum rate of 75% and at the same time stipulates the calculation of the monthly pension level of workers eligible for pensions who have paid social insurance according to the provisions of international treaties to which the Socialist Republic of Vietnam is a member but have paid social insurance in Vietnam for less than 15 years, each year of contribution during this period is calculated at 2.25%.

4. Adding maternity benefits to voluntary social insurance policy

The Law on Social Insurance (amended) stipulates that employees participating in voluntary social insurance (including both female and male employees) who give birth and meet the conditions (paying social insurance for at least 6 months within 12 months before giving birth) will receive a subsidy of 2 million VND for each child born and each fetus 22 weeks or older that dies in the womb or dies during labor.

The funding for implementing this subsidy is guaranteed by the State Budget and the Government decides to adjust the maternity subsidy level in accordance with socio-economic development conditions and the capacity of the State budget in each period.

5. Amendment of regulations on one-time social insurance benefits

The Law on Social Insurance (amended) stipulates that one-time social insurance benefits are for employees who have paid social insurance before the effective date of the Law on Social Insurance (amended), after 12 months are not subject to compulsory social insurance, do not participate in voluntary social insurance and have paid social insurance for less than 20 years, if in need, they can receive one-time social insurance benefits.

Thus, for the group of employees who start participating in social insurance from the time the Law on Social Insurance (amended) takes effect (from July 1, 2025), they will not be able to receive one-time social insurance according to this condition (one-time social insurance will only be settled in the following cases: Reaching retirement age but not having enough years of social insurance contributions to receive pension or going abroad to settle down or suffering from one of the following diseases: cancer, paralysis, decompensated cirrhosis, severe tuberculosis, AIDS or people with a labor capacity reduction of 81% or more; people with extremely severe disabilities).

6.BSupplementing regulations on handling late payment and evasion of social insurance payment

The Law on Social Insurance (amended) stipulates the responsibilities of agencies in identifying and managing subjects eligible for social insurance; specifically regulates acts of late payment and acts of evasion of payment; and has amended and supplemented many measures and sanctions to handle the situation of late payment and evasion of social insurance payment.

The new law specifically stipulates measures to handle acts of late payment of social insurance and evasion of social insurance: mandatory payment of full amount of late payment of social insurance, evasion of payment; payment of an amount equal to 0.03%/day calculated on the amount of late payment of social insurance, unemployment insurance and the number of days of late payment, evasion of payment; administrative sanctions according to the provisions of law; no consideration for awarding emulation titles or forms of commendation. Particularly for acts of evasion of payment, there is also a strong measure of criminal prosecution according to the provisions of law.

In addition, to ensure the rights of employees, the Law has added the responsibility of employers to compensate employees if they do not participate or participate in compulsory social insurance incompletely or untimely, causing damage to the legitimate rights and interests of employees.