Supporting both workers and employers to escape distress

Deputy director general of Vietnam Social Security Le Hung Son

On September 24, the government issued Resolution No.116/NQ-CP on policies to support employees and employers affected by the pandemic using the unemployment insurance fund. Vietnam Social Insurance (VSS) is one of the governmental agencies that directly organise the implementation of this support package. How many employees and employers are entitled to this?

Workers who benefit from this package are those who are covered by unemployment insurance as of September 30, 2021, excluding employees working in state agencies, political organisations, socio-political organisations, the armed forces, and public non-business agencies whose recurrent expenditures are covered by the state budget.

They also include workers who have stopped participating in unemployment insurance due to termination of their labour contracts or working contracts in the period from January 1, 2020 to the end of September 30, 2021, and have an unemployment insurance contribution period reserved in accordance with legal regulations on employment, excluding retirees who receive monthly pensions.

Employers participating in unemployment insurance are also beneficiaries of this support package.

Accordingly, nearly 13 million workers out of about 15 million people participating in unemployment insurance and 386,000 employers are entitled to the support policy.

How can they access this support?

As many as 386,000 employers will be entitled to a reduction in unemployment insurance contributions to the unemployment insurance fund from 1 per cent to zero for a period of 12 months, from October 1, 2021 to the end of September 2022 without arising administrative procedures.

Local social insurance agencies, based on the management software of collection of social insurance, health insurance, and unemployment insurance premiums, will generate a monthly data format on insurance premiums and deduct the 1 per cent contribution to the unemployment insurance fund of employers.

For 13 million employees, local social insurance agencies will define the beneficiaries of the support package by the identification numbers of participants on the unemployment insurance and the time for participation in unemployment insurance based on existing IT database.

How will reduction of the contribution rate for unemployment insurance impact businesses?

Businesses are like trees. If they are well taken care of, they will produce sweet fruits for both them and their workers.

With 386,000 businesses enjoying the reduction of contribution rate to the unemployment insurance fund within 12 months, the total amount is expected to reach over VND8 trillion ($347 million).

With this reduced amount, employers will have more funds for pandemic prevention and control measures for their employees at the workplace and for their reinvestment in production and business, thus contributing to creating jobs and stable income for local workers.