Participation in social insurance is a mandatory condition when employing foreign employees. So, who is the subject, how much is the premium rate and what are the procedures for participation in social insurance regimes for foreign citizens working in Vietnam?
Summary
Foreigners subject to the compulsory social insurance
The latest social insurance regimes for foreigners working in Vietnam are specified in the Decree No. 143/2018/ND-CP issued by the Government on October 15, 2018 and the Law on occupational safety and hygiene regarding compulsory social insurance applicable to foreign employees.
In which, contents about subjects participating in social insurance are specified in Article 2 of the Decree. Accordingly, foreigners working in Vietnam must pay compulsory social insurance when they satisfy all 3 following conditions:
+ Obtaining a work permit, practice certificate or license issued by the competent authorities in Vietnam.
+ Signing a labor contract with a term of at least 1 year or an indefinite term contract with an employer in Vietnam.
+ Still being at working age, not yet reaches the retirement age (60 years old for men, 55 years old for women).
Note: Foreign employees working in Vietnam are not required to participate in social insurance if they fall into one of the following cases:
+ Being an executive director, manager, technician, and expert working for a minimum of 12 months for a foreign enterprise with a trademark presence in Vietnam, it is not required to pay social insurance when moving internally from another fellow company.
+ Reaching the retirement age according to the regulations on the retirement regime.
+ Participating in signing and negotiating many labor contracts with many units only need to participate in social insurance with the first unit, the later one do not need to pay insurance.
The payment rate of social insurance for the foreign employees
+ From December 01, 2018, the payment rate of social insurance is based on the employee's salary fund for participation in social insurance:
- Employers contribute 3% to the sickness and maternity fund and 0.5% to the labor accident and occupational disease fund, and do not need to pay the pension and death benefit fund. Total contribution is 3.5%.
- Foreign employees are not required to contribute to the above funds.
+ From January 01, 2022, the payment rate of social insurance is based on the employee's salary fund for participation in social insurance:
- Employers contribute 3% to the sickness and maternity fund, pay 0.5% to the labor accident and occupational disease fund and 14% to the pension and death benefit fund. Total is 17.5%
- Foreign employees contribute 8% to the pension and death benefit fund. Total payment rate of employees is 8% for this period.
Note:
+ The prescribed salary for paying social insurance for foreigners includes salary, allowances and attached additional amounts. The salary paid for social insurance is equal to 20 times of base salary in maximum.
+ Salary for paying social insurance does not include benefits and bonuses under the Labor Law.
Procedures and required documents for participating in social insurance for foreign employees
Basically, the procedure and required documents for participating in social insurance for foreign citizens working in Vietnam uses a number of forms similar to those for domestic workers. However, the employer and the employee need to note some regulations.
For employers
+ Declaration of participating unit adjusting information of social insurance and health insurance under Form TK3-TS.
+ List of employees participating in social insurance, health insurance, unemployment insurance, occupational accident and occupational disease insurance under Form D02-TS.
For foreign employees
+ Declaration of participation in, adjustment of information of social insurance and health insurance under form TK1-TS and only use this form in case the participant has not been issued with social insurance code or when there is any change of information.
Note:
+ When filling in information, the data fields on full name, country and gender must be written according to the international phonetic rules.
+ Attached personal documents issued by a state agency must be translated into Vietnamese and be duly certified in accordance with Vietnamese law.
Above is a summary of useful information about social insurance regimes for foreigners. To learn more about social insurance as well as services to apply for work permits for foreigners, please contact Nhi Gia via hotline +84 1900 6654 or click on https://www.facebook.com/nhigia, our team of experienced specialists will wholeheartedly support you!
