Vietnam social insurance – changes from June 2017
On April 14th, 2017, the government issued the Decree No.47/2017/NĐ-CP regulating the rates of Vietnam social insurance enterprises’ contribution paid in the Insurance Fund for labor accidents and occupational sickness. This will be a change affecting companies’ internal hr management in the future.
Accordingly, The employers only have to pay 0,5% (current regulation is 1%) of their salary fund which is based to calculate the social insurance for labor accident and occupational sickness fund of employees.
Therefore, the total premium will be reduced to 32% from 01/06/2017. While the current regulation is 32.5%.
This decree will be effective from June 01st, 2017.
Social premium is reduced but the base salary is expected to rise to VND 1,300,000 and insurance claims (on total wages and allowances), whereby, will be increased in the future.
In order to properly and optimally comply with the state regulations, manage and control monthly payrolls, customers should recalculate the payroll system, salary structure, allowances and the labor contract for proper compliance and cost optimization.
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