Question:
Our company would like to understand the current provisions of Vietnamese law regarding the components constituting wages and the mandatory contribution rates applicable to employers and employees, including: social insurance, health insurance, unemployment insurance, and other compulsory insurance schemes. Please specify the contribution rates for each party and the applicable legal basis.
Answer
To ensure accurate payroll payments, the Company needs to analyze in detail the salary components and applicable contribution rates, including:
A. Employer’s contributions
- Social Insurance: Pursuant to Article 34.1 of the Law on Social Insurance 2024, employers shall make monthly contributions based on the wage used as the basis for compulsory social insurance contributions, including:
(i) 3% to the sickness and maternity fund;
(ii) 14% to the retirement and survivorship fund. - Unemployment Insurance: Pursuant to Article 57.1(b) of the Law on Employment 2013, contribute 1% of the monthly wage fund of employees participating in unemployment insurance.
- Health Insurance: Pursuant to Article 18.1 of Decision No. 595/QĐ-BHXH, contribute 3% of the monthly wage used as the basis for compulsory health insurance contributions.
- Occupational Accident and Occupational Disease Insurance: Pursuant to Article 4.1 of Decree No. 58/2020/NĐ-CP, contribute 0.5% of the wage fund used as the basis for compulsory social insurance contributions.
B. Employee’s contributions
- Social Insurance: Pursuant to Article 33.1 of the Law on Social Insurance 2024, contribute 8% of the monthly wage used as the basis for compulsory social insurance contributions, paid into the retirement and survivorship fund.
- Unemployment Insurance: Pursuant to Article 57.1(b) of the Law on Employment 2013, contribute 1% of the monthly wage used as the basis for unemployment insurance contributions.
- Health Insurance: Pursuant to Article 18.1 of Decision No. 595/QĐ-BHXH, contribute 1.5% of the monthly wage used as the basis for compulsory health insurance contributions.
Thus, the total mandatory contribution rate is allocated between the employer and the employee at the levels stated above, based on the monthly wage used as the basis for insurance contributions.
