Recently, the Ministry of Labor, War Invalids and Social Affairs of Vietnam has proposed that the labor contract with a term of one month or more will be subject to unemployment insurance in Vietnam. Currently, the community is having mixed opinions about this proposal. However, according to ASL Law, allowing employees to have short – term contracts to participate in unemployment insurance will be able to increase the rights of employees, helping them to increase access to the supply of unemployment insurance with higher rate.
According to the report to the Government draft dossier of Employment Law (amended), the Ministry of Labor, War Invalids and Social Affairs of Vietnam has proposed the expansion of unemployment insurance coverage to ensure benefits for employees from shocks such as pandemic, natural disasters, economic recession, etc. market crisis which is becoming more serious and ‘more often’ recently.
Thereby, according to the proposal, all employees have contracted contracts and labor contracts with indefinite terms and contracts from one month or more, business management and cooperative operators must participate in unemployment insurance.
The current law stipulates that the contract of 3 months or more must participate in unemployment insurance. This contract term is relatively long for a part of the employee who performs periodic jobs, has a short – term cycle, affecting their rights and interests as well as reducing the unemployment insurance fund’s revenue source.
With the unemployment insurance contribution for contracts with a term of one month or more, employees paying unemployment insurance will be able to ensure their rights better. For example, if the employee is working at 6 different companies within 12 months, each company 2 months (1 month or 2 month contract, definite time) without overlapping, before, they would not be allowed to participate in unemployment insurance under the mechanism of the business.
However, with this proposal, that employee will have benefits of 12 months participating in the unemployment insurance regime and meet the conditions for receiving unemployment insurance benefits of 3 months. Monthly unemployment allowance is equal to 60% of the average monthly salary of unemployment insurance premiums for 06 months before unemployment.
The labor contract with a term of one month or more will be the subject of unemployment insurance in Vietnam
The stream of opposition oppose the proposal is mainly from the fact that when they have to participate in compulsory unemployment insurance, social insurance, the employee will have their actual salary deducted from a sum of money they received each month, reduce the actual benefits of them monthly.
However, employers in labor relations will always have to submit a higher contribution (usually double) the amount that the employee must pay, so when considering the overall benefit, the employee actually gains more benefit from the proposal. If the employee decides to withdraw and enjoy unemployment benefits after 12 months of unemployment insurance contributions, they will have the above benefits and more importantly, the guarantee for life if they unfortunately lose their jobs, affected by natural disasters, epidemics, etc.
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