Lack of social insurance buy in

About 16,000 labourers got unemployment benefits from the Hanoi Job Promotion Centre by late 2011, nearly quadruple the amount from last year, according to the centre’s Unemployment Insurance Department head Nguyen Thi Kim Loan.

Loan said this amount was just a drop in the bucket since the unemployment insurance policy came into force from early 2009.

Only labourers having paid unemployment insurance fees for at least 12 months and satisfying strict requirements were liable to get benefits through a one-off payment.

Under current regulations, for workers with labour contracts above three months from January 1, 2012 compulsory social insurance payment rate is 24 per cent of their monthly wages of which the labourers pay 7 per cent and their employers the remaining 17 per cent, up 1 per cent each on previous levels.

Centre director Vu Trung Chinh said amid a hostile business climate the people losing jobs spiked from early 2012 as by the end of March 2012 14,544 labourers got unemployment benefits worth VND42.6 billion ($2 million) from Hanoi Social Security.

In fact, from late 2009 due to escalating debts to social insurance fund Hanoi Social Security proposed Hanoi authorities give it the go-ahead to join hands with diverse finance, labour, invalid and social affair sectors to collect these debts in Hanoi areas.

From early 2010, the task force sued 42 firms with collected amount just 5 per cent of due amount, according to Hanoi Social Security deputy director Nguyen Duc Hoa.

“Hanoi Social Security recommends taking employers dodging their social insurance payment obligations to court,” said Hoa.

Only labourers of firms which have fulfilled their social insurance payment obligations or finalised procedures to go bust would get unemployment benefits. So stronger sanction measures would be applied to shield labourers’ legitimate interests, Hoa asserted.

Businesses in construction, transport, garment textile, mining and services surfaced the most on the Hanoi Social Security black-list.

The largest debtors are Bridge 14 Joint Stock Company (under Civil Engineering Construction Corporation 1- Cienco 1) at VND10 billion ($476,000), Construction and Investment JSC 122, Investment Development and Construction JSC 115, Construction Engineering JSC 121, 116 Joint Stock Company (all belonging to Cienco 1), Investment and Construction Engineering JSC 809 (under Cienco 8) owed VND20 billion ($952,000).