Also participating in compulsory social insurance like Vietnamese workers, when they reach retirement age, can foreign workers receive a monthly pension?
Pursuant to Clauses 1 and 2, Article 2 of Decree 143/2018/ND-CP, foreigners working in Vietnam must participate in compulsory social insurance if they fully meet the following conditions:
- Employees being foreign citizens working in Vietnam who possess a work permit or practice certificate or practice license granted by a competent Vietnamese agency and sign an indefinite-term contract or a contract with a term of at least 1 year with an employer in Vietnam are subject to compulsory social insurance.
- The employees defined in Clause 1 of this Article are not subject to compulsory social insurance prescribed in this Decree if they fall into one of the following cases: 1. They are transferred within an enterprise under Clause 1, Article 3 of the Government’s Decree No. 11/2016/ND-CP of February 3, 2016, detailing a number of articles of the Labor Code regarding foreign workers in Vietnam; 2. They reach the retirement age prescribed in Clause 1, Article 187 of the Labor Code.
When all of the aforementioned conditions are met, both foreign workers and the businesses that employ them are required to pay monthly social insurance contributions in accordance with regulations.
Are foreign workers paying compulsory social insurance entitled to pension?
Clause 1, Article 9 of Decree 143/2018/ND-CP stipulates: The employees defined in Clause 1, Article 2 of this Decree are entitled to a pension when meeting the conditions for pension enjoyment specified in Clause 1, Article 54 of the Law on Social Insurance and Article 6 of Decree No. 115/2015/ND-CP.
Accordingly, foreign employees participating in compulsory social insurance can be fully entitled to a pension if they simultaneously meet the following conditions:
- Compulsory social insurance contributions from full 20 years or more.
- Having reached the retirement age in accordance with the Labor Code.
According to Article 169 of the Labor Code 2019, the retirement age for foreign workers is the same as for Vietnamese workers. Specifically:
The case of working under normal conditions:
- Retirement in 2022: Male employees must be at least 60 years and 6 months old; female employees must be from full 55 years and 8 months.
- Retirement years later: The retirement age of men increases by 03 months/year, and the retirement age of women increases by 04 months/year.
In case of having full 15 years of doing jobs with heavy, hazardous, or dangerous elements or having full 15 years of working in an area with extremely difficult conditions: To be entitled to retire at most 5 years earlier than the casework under normal conditions.
In case of having full 15 years of working as a coal miner in a pit: To retire up to 10 years earlier than in the case of working under normal conditions.
In case of being infected with HIV due to an occupational accident while performing assigned tasks: Not considering retirement age.
How is the pension of foreigners calculated?
Point a Clause 2, Article 9 of Decree No. 143/2018/ND-CP stipulates the level of pension enjoyment for foreign workers as follows:
The monthly pension must comply with Clause 2, Article 56 of the Law on Social Insurance and Clauses 1 and 2, Article 7 of Decree No. 115/2015/ND-CP;
According to this regulation, the pension rate of foreign workers will be calculated according to the following formula:
Pension = Pension rate x Average monthly salary on which social insurance premiums are based.