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Due to the raging Covid-19 pandemic in Vietnam, many workers are taking special interest in unemployment insurance because they have had to quit their job, or are temporarily out of work and fear that their employers won’t take them back after the pandemic is over, etc. So, they are concerned that in the circumstance that they are fired or out of their job, will their unemployment insurance support them? And If it does, how much will the unemployment insurance cover?
Unemployment insurance
Unemployment insurance is a regime aimed at compensating a part of a worker’s income when he or she loses a job. This compensation will support workers in vocational training, job maintenance, and job search based on contributions to the Unemployment Insurance Fund.
Subjects required to participate in unemployment insurance
According to the provisions of Article 43 of the Employment Law 2013, the specific beneficiaries of unemployment insurance are as follows:
Workers:
- Labor contract or working contracts of indefinite time;
- Labor contract or working contracts of definite time;
- Seasonal or jobbased working contracts with a term of between full 3 months and under 12 months
Employers:
- State agencies, public nonbusiness units, and people’s armed forces units;
- Political organizations, sociopolitical organizations, sociopoliticalprofessional organizations, social organizations, and socioprofessional organizations;
- Foreign agencies and organizations and international organizations operating in the Vietnamese territory;
- Enterprises, cooperatives, households, business households, cooperative groups, other organizations;
- Individuals that hire or employ workers under the labor contracts or working contracts
Note: Workers who are receiving pensions or doing domestic work are not required to participate in unemployment insurance.
How many years does a worker need to pay unemployment insurance to receive benefits?
Workers participating in unemployment insurance when leaving work will be entitled to unemployment benefits if they fully meet the conditions specified in Article 49 of the Employment Law 2013 as follows:
- Terminating the labor contract or working contract.
- Having paid unemployment insurance for a full 12 months or more in the 24 months before the contract termination.
- Having submitted a dossier for receipt of unemployment allowance to an employment service center within 03 months from the date of contract termination.
- Having not yet found any job after 15 days from the date of submission of the dossier for receipt of unemployment allowance.
Based on the above provisions, workers who have paid full 12 months in the 24 months before the termination of the contract will be considered for unemployment benefits when they quit their jobs.
Notably, unemployment insurance participants, whether continuously or intermittently paying insurance premiums, are all entitled to benefits of unemployment insurance.
How is the unemployment benefit calculated?
According to Article 50 of the Employment Law 2013, unemployment benefits will be paid monthly to workers. The monthly allowance is calculated according to the following formula:
Amount of allowance/month = 60% x Average monthly salary on which unemployment insurance premiums are based on the preceding 06 months before leaving.
– The period of enjoying unemployment benefits is calculated according to the number of months that the worker has paid insurance premiums. Specifically:
- Full payment of 12 – 36 months: Calculated to enjoy 03 months of allowance.
- After that: For every additional 12 months, the worker will be entitled to an additional month of allowance.
- Maximum benefit period = 12 months.
– The maximum level of unemployment benefits that workers are entitled to:
- Not more than 05 times the base salary.
- Not more than 05 times the regional minimum wage.
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