Circular No. 19/2018/TT-BLDTBXH dated October 30, 2018 of the Ministry of Labor, War Invalids and Social Affairs on guidelines for formulation of agreement on participation in voluntary supplemental retirement program at enterprises

THE MINISTRY OF LABOR, WAR INVALIDS AND SOCIAL AFFAIRS

Circular No. 19/2018/TT-BLDTBXH dated October 30, 2018 of the Ministry of Labor, War Invalids and Social Affairs on guidelines for formulation of agreement on participation in voluntary supplemental retirement program at enterprises

Pursuant to Government s Decree No. 14/2017/ND-CP dated February 17, 2017 on functions, tasks, powers and organizational structure of the Ministry of Labor, War Invalids and Social Affairs;

Pursuant to Government s Decree No. 88/2016/ND-CP dated July 01, 2016 on voluntary supplemental retirement program;

At the request of the Director of Department of Social Security,

The Minister of Labor, War Invalids and Social Affairs promulgates a Circular on guidelines for formulation of agreement on participation in voluntary supplemental retirement program at enterprises.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of adjustment

This Circular provides guidelines for formulation of agreement on participation in pension additional voluntary contribution scheme prescribed in Government s Decree No. 88/2016/ND-CP dated July 01, 2016 on voluntary supplemental retirement program (hereinafter referred to as Decree No. 88/2016/ND-CP).

Article 2. Subjects of application

1. Employees aged 15 or older who have worked under labor contracts with employers.

2. Employers which are enterprises, agencies, organizations, cooperatives, household businesses, persons hiring and employing employees under labor contracts.

3. Organizations and individuals relevant to pension additional voluntary contribution schemes.

Chapter II

FORMULATING AND SIGNING AGREEMENTS

Article 3. Agreement on participation in voluntary supplemental retirement program

1. Agreement on participation in voluntary supplemental retirement program (hereinafter referred to as Agreement) means a written agreement between the employee and the employer on contribution responsibility, rights and obligations of each participant in the voluntary supplemental retirement program.

2. Agreement must be made in 3 copies, 1 copy is kept by the employee, 1 copy is kept by the employer, and 1 copy is kept by the pension fund management company.

Article 4. Rules for concluding Agreement

1. Voluntariness, equality, amicability, cooperation, and truthfulness.

2. Free to conclude Agreement which does not go against the law, collective bargaining agreement and social ethics.

Article 5. Content of Agreement

An Agreement of voluntary supplemental retirement program shall be made as prescribed in Point b Clause 2 Article 8 of Decree No. 88/2016/ND-CP, which contains the following:

1. Name of the voluntary supplemental retirement program which the employee chooses to participate in as prescribed in Article 6 hereof.

2. Basic information of the voluntary supplemental retirement program as prescribed in Article 7 hereof.

3. Validity period of the Agreement as prescribed in Article 8 hereof.

4. Employer’s contributions, contribution frequency and duration prescribed in Article 9 hereof.

5. Employee’s contributions, contribution frequency, duration and method (if the employee jointly making contribution with the employer) prescribed in Article 10 hereof.

6. Employee’s rights and obligations upon participation in voluntary supplemental retirement program prescribed in Article 11 and Article 12 hereof.

7. Employer’s rights and obligations upon participation in voluntary supplemental retirement program for their employees’ benefits prescribed in Article 13 and Article 14 hereof.

8. Matters that the employee authorizes the employer prescribed in Article 15 hereof.

9. Process of changing contents in the Agreement (if any).

10. Cases of temporary suspension or suspension from participation in the voluntary supplemental retirement program prescribed in Article 16 and Article 17 hereof.

11. Other agreements between the employee and the employer not in contrary to laws and regulations (if any).

Article 6. Name of voluntary supplemental retirement program

1. Based on the labor management need and financial resources, the employer may build up single or multiple voluntary supplemental retirement program(s) to make contributions to the pension fund for employees.

2. An employee shall choose to participate in a voluntary supplemental retirement program that he/she deems that he/she is eligible for and wishes to participate in.

Article 7. Basic information of the voluntary supplemental retirement program

Basic information of the voluntary supplemental retirement program in the Agreement includes:

1. Eligible entities and conditions for participation in the voluntary supplemental retirement program.

2. Employer’s commitment on minimum contribution rate when the employee participates in the voluntary supplemental retirement program.

3. The pension fund management company chosen by the employer.

4. Beneficiary’s eligibility criteria, plans for payment from pension fund.

Article 8. Validity period of Agreement

1. When concluding an Agreement, the employee and the employer must specify the validity period of the Agreement, start time and end time of the voluntary supplemental retirement program.

2. The end time of the voluntary supplemental retirement program cannot come after the termination date of the labor contract between the employer and the employee.

Article 9. Employer’s contributions, contribution frequency and duration

The employer shall determine its specific contributions, contribution frequency and duration as follows:

1. Contribution is determined as an absolute amount or a percentage on the employee’s salary. The employer’s contribution may not less than the minimum contribution prescribed in Clause 2 Article 7 hereof.

2. Contribution frequency may be once a month, once every two months, once every three months, or another frequency at the employer’s discretion in conformity with its capacity and need.

3. Contribution duration shall be mutually agreed by the employer and the employee in conformity with the voluntary supplemental retirement program which is built up by the employer and chosen by the employee. The contribution duration shall be specified in the agreement.

Article 10. Employee’s contribution rate, frequency, duration and method

If an employee jointly making contributions to the pension fund, his/her contribution rate, frequency, duration and method shall be determined as follows:

1. Contribution amount is determined as an absolute amount or a percentage on the employee’s salary.

2. Contribution frequency may be once a month, once every two months, once every three months, or another frequency at the employee’s discretion in conformity with its capacity and need.

3. Contribution duration shall be mutually agreed by the employer and the employee in conformity with the voluntary supplemental retirement program which is built up by the employer and chosen by the employee. The contribution duration shall be specified in the agreement.

4. The employee makes contributions to the pension fund through the employer by having the employer withhold his/her contribution from his/her monthly salary.

Article 11. Rights of employees

When an employee enters into an Agreement, he/she shall have the rights to:

1. Decide to participate or stop participating in the voluntary supplemental retirement program.

2. Decide his/her contribution rate, frequency, duration, method and any change (if any) in conformity with the voluntary supplemental retirement program which is established by the employer and chosen to participate by the employee.

3. Enjoy all benefits prescribed in the voluntary supplemental retirement program in which he/she participates, contents in the Agreement and in accordance with laws and regulations.

4. Come into an agreement with the employer to change the contents of the Agreement or request the employer to fulfill contents as committed in the Agreement and the voluntary supplemental retirement program.

5. Receive the employer’s contribution and the investment from this contribution in a case where the employer unilaterally stops participating in the voluntary supplemental retirement program.

6. Unilaterally terminate execution of the Agreement.

7. Other rights as agreed upon with the employer and as per the law.

Article 12. Obligations of employees

1. Make contributions as committed in the Agreement.

2. Notify the employer at least 5 working days of any change to the contribution rate, frequency, duration and method; at least 3 working days of the temporary suspension or suspension from execution of the Agreement.

3. Other obligations as agreed upon with the employer and as per the law.

Article 13. Rights of employers

1. Decide their part of contribution rate, frequency, duration.

2. Come into agreement with the employee on change to contents of the Agreement in conjunction with their obligations and duties.

3. Receive their contributions for the employee and investment from these contributions in a case prescribed in the voluntary supplemental retirement program and the Agreement.

4. Unilaterally terminate the Agreement in a case where the employee commits legal violations as to the voluntary supplemental retirement program or regulations on voluntary supplemental retirement program of the enterprise.

5. Other rights as agreed upon with the employee and as per the law.

Article 14. Obligations of employers

1. Make contributions according to the agreed contribution rate, frequency and duration.

2. Abide by and perform commitment in the Agreement and prescribed by law.

3. Pay the contribution withheld from the employee’s salary (if any).

4. Follow procedures with the pension fund management company in order for the employee to enjoy or forward the contribution to the fund.

5. Other obligations as agreed upon with the employee and as per the law.

Article 15. Employee’s authorization

The employee shall authorize the employer to perform the following tasks:

1. Enter into an agreement on pension fund participation with a pension fund management company.

2. Choose investment plans as provided in the charter of pension fund.

3. Pay related fees and costs as provided in the charter of pension fund.

Article 16. Cases of temporary suspension from participation

The employee and the employer reach an agreement on temporary suspension from participation in the voluntary supplemental retirement program in case of one of the following cases:

1. The employee and the employer reach an agreement on suspension from the Agreement.

2. The employee delays the labor contract.

Article 17. Cases of suspension from participation

The employee and the employer reach an agreement on suspension from participation in the voluntary supplemental retirement program in case of one of the following cases:

1. The Agreement expires but they do not agree to extend or re-sign the Agreement.

2. The employee and the employer agree to suspend from participation.

3. The employee unilaterally terminates the execution of the Agreement.

4. The employer unilaterally terminates the execution of the Agreement.

5. The labor contract between the employee and the employer terminates before the expiry of the Agreement.

Chapter III

IMPLEMENTATION PROVISIONS

Article 18. Effect

This Circular takes effect on December 15, 2018.

Article 19. Implementation organization

1. Employers, employees, pension fund management companies and relevant entities shall implement this Circular.

2. Difficulties that arise during the implementation of this Circular should be reported to the Ministry of Labor, War Invalids and Social Affairs for consideration./.

For the Minister

The Deputy Minister

Le Quan.