Tiếng Việt
中文 (中国)
On June 29, 2023, the Vietnamese Government officially issued Decree No. 42/2023/NĐ-CP on pension adjustment policies after a period of discussion, feedback, and revision. Accordingly, starting from July 2023, Vietnamese citizens who have participated in social insurance and receive pensions within the scope regulated by Decree No. 42 will see an increase in their pensions.
Article 2, Clause 1 of Decree No. 42 specifies the timing and adjustment rates of pensions from July 1, 2023, as follows:
a) An additional increase of 12.5% on the pension amount, social insurance allowances, and monthly allowances from June 2023 for the subjects specified in Clause 1, Article 1 of Decree No. 42, which have been adjusted according to Decree No. 108/2021/NĐ-CP dated December 7, 2021, of the Government regarding pension, social insurance allowances, and monthly allowances adjustment.
b) An additional increase of 20.8% on the pension amount, social insurance allowances, and monthly allowances from June 2023 for the subjects specified in Clause 1, Article 1 of Decree No. 42, which have not been adjusted according to Decree No. 108/2021/NĐ-CP dated December 7, 2021, of the Government regarding pension, social insurance allowances, and monthly allowances adjustment.
2. From July 1, 2023, individuals who are receiving pensions, social insurance allowances, and monthly allowances as specified in Clause 2, Article 1 of Decree No. 42, after being adjusted according to the provisions of Clause 1 of this Article, and have a monthly entitlement lower than 3,000,000 Vietnamese dong, will receive additional adjustments as follows: an increase of 300,000 Vietnamese dong per person per month for those with entitlement below 2,700,000 Vietnamese dong per person per month, and an increase to 3,000,000 Vietnamese dong per person per month for those with entitlement ranging from 2,700,000 to below 3,000,000 Vietnamese dong per person per month.
3. The adjusted pension amount, social insurance allowances, and monthly allowances specified in this Article will serve as the basis for calculating subsequent adjustments in pensions, social insurance allowances, and monthly allowances.
Why haven’t Vietnamese citizens received the pension increase for July?
At the beginning of July, when retirees receive their monthly pensions, they reported and questioned the lack of an increase in their pension amount. Specifically, their pension amount for July was no different from the amount received in June, even though the Decree clearly stated that the adjustment would begin in July, not August.
In reality, Article 5, Clause 1 of Decree No. 42 clearly stipulated that “1. Decree No. 42 shall take effect from August 14, 2023. The provisions of Decree No. 42 shall be implemented from July 1, 2023.”
Therefore, the changes regarding pensions regulated by Decree No. 42 will officially take effect starting from August 14, 2023. As a result, not only did citizens not receive the increase in July, but they will also not see any changes when they receive their pensions in August since pension disbursement usually occurs in the first few days of the month, while the changes will take effect in mid-August.
However, pension recipients do not need to worry because these adjustment amounts will still be recorded from the beginning of July. They will receive the increases for July and August when they receive their September pension. Therefore, the deserving pension amount will remain unchanged, only differing in the timing of disbursement.
ASL LAW is the top-tier Vietnam law firm for Employment and Labor Law. If you need any advice, please contact us for further information or collaboration.
