Question:
In the case of a company signing a 12-month employment contract with an employee who is of retirement age but has not completed 20 years of participation in social insurance, does the employee fall under the mandatory insurance coverage?
Answer:
Based on the Social Insurance Law, Vietnamese citizens working under indefinite-term labor contracts or fixed-term labor contracts of 3 months or more are subject to mandatory participation in social insurance and mandatory participation in unemployment insurance, except for those already receiving retirement benefits.
Therefore, employees working for a company under indefinite-term labor contracts or fixed-term labor contracts of 3 months or more, who are not eligible for retirement benefits, are still subject to mandatory participation in social insurance and mandatory participation in unemployment insurance.
Question:
In 2016, our company had an employee reaching retirement age who wanted to retire after their 55th birthday (having met the conditions to receive a pension). The employee wants to know how their pension is calculated. From the time of joining in August 1994 until August 2004, they received the minimum wage-based pension according to state regulations. After that, the employee joined our company, a limited liability company with two members, and received a salary based on the company’s registered salary scale.
Answer:
According to Article 62, Clause 3 of the Social Insurance Law No. 58/2014/QH13, for individuals who have periods of social insurance contributions under both the state-prescribed salary regime and the employer’s decided salary regime, the average monthly social insurance contribution amount is calculated by taking into account both periods. Specifically, the period during which contributions were made under the state-prescribed salary regime is included in the calculation of the average monthly social insurance contribution amount:
a/ The average monthly salary on which social insurance premiums are based in the last 5 years prior to retirement, for employees paying social insurance premiums before January 1, 1995;
b/ The average monthly salary on which social insurance premiums are based in the last 6 years prior to retirement, for employees paying social insurance premiums between January 1, 1995, and December 31, 2000;
c/ The average monthly salary on which social insurance premiums are based in the last 8 years prior to retirement, for employees paying social insurance premiums between January 1, 2001, and December 31, 2006;
d/ The average monthly salary on which social insurance premiums are based in the last 10 years prior to retirement, for employees paying social insurance premiums between January 1, 2007, and December 31, 2015;
đ/ The average monthly salary on which social insurance premiums are based in the last 15 years prior to retirement, for employees paying social insurance premiums between January 1, 2016, and December 31, 2019;
e/ The average monthly salary on which social insurance premiums are based in the last 20 years prior to retirement, for employees paying social insurance premiums between January 1, 2020, and December 31, 2024;
f/ The average monthly salary on which social insurance premiums are based in the entire period of social insurance premium payment, for employees paying social insurance premiums since January 1, 2025.
– Article 74 stipulates that starting from January 1, 2016, until before January 1, 2018, the monthly pension amount for eligible workers is calculated at 45% of the average monthly social insurance contribution income corresponding to 15 years of social insurance contributions. Afterward, for each additional year, an increment of 2% is applied for males and 3% for females. The maximum limit is capped at 75%.
Question:
Recently, our company had a worker retire in March 2017 and has been receiving monthly pension benefits from April 2017 until now. When the state increased the basic salary level from 1,210,000 VND to 1,300,000 VND, will the monthly pension benefits for our company’s worker also be increased?
Answer:
In the case of the employee mentioned by your company, the pension for July 2017 will be adjusted to increase by 7.44% compared to the pension for June 2017. This adjustment is carried out according to Government Decree 76/2017/ND-CP dated June 30, 2017, regarding the adjustment of pensions and monthly social insurance benefits. The increased pension portion (starting from July 2017) will be received in the pension payment period for September 2017.
