Official Dispatch 1064/LDTBXH-BHXH 2019 on response to matters relating to the implementation of Decree No. 143/2018/ND-CP

The Ministry of Labor, Invalids and Social Affairs recently receives written request from a number of localities, enterprises and business associations for clarification of employees being foreign citizens working in Vietnam that are subject to compulsory social insurance under the Government’s Decree No. 143/2018/ND-CP dated October 15, 2018, on detailing the Law on Social Insurance and the Law on Occupational Safety and Health regarding compulsory social insurance. The Ministry of Labor, Invalids and Social Affairs gives the opinion as follows:

According to Clause 1 Article 2 of Decree No. 143/2018/ND-CP: “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 labor contract or a labor contract with a term of at least full 1 year with an employer in Vietnam are subject to compulsory social insurance.”

Clause 2 Article 2 of Decree No. 143/2018/ND-CP stipulates the exclusion cases, to be specific: “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:

a) They are transferred within an enterprise under Clause 1, Article 3 of the Government’s Decree No. 11/2016/ND-CP dated February 03, 2016, detailing a number of articles of the Labor Code regarding foreign workers in Vietnam;

b) They reach the retirement age prescribed in Clause 1 Article 187 of the Labor Code.”

According to Clause 1 Article 3 of the Government’s Decree No. 11/2016/ND-CP of February 03, 2016, on detailing a number of articles of the Labor Code regarding foreign workers in Vietnam: “Foreign intra-corporate transferee means a manager, an executive, a specialist or a technical worker of a foreign enterprise that has established a commercial presence in Vietnam’s territory, who is temporarily transferred within the same enterprise to a commercial presence in Vietnam’s territory and was recruited by the foreign enterprise at least 12 months ago.”

Thus, based on the above-mentioned regulations, a foreign employee is subject to compulsory social insurance if he/she fully satisfy the following conditions:

- Possessing a work permit or practice certificate or practice license granted by a competent Vietnamese agency;

- Signing an indefinite-term labor contract or a labor contract with a term of at least full 1 year with an employer in Vietnam;

- Not reaching full 60 years for a male employee or not reaching full 55 years for a female employee;

- Not being intra-corporate transferee defined Clause 1 Article 3 of the Decree No. 11/2016/ND-CP, meaning employee being a manager, an executive, a specialist or a technical worker of a foreign enterprise who was recruited by the foreign enterprise at least 12 months ago and is temporarily transferred within the same enterprise to a commercial presence in Vietnam’s territory.

The Vietnam Social Security and Departments of Labor, Invalids and Social Affairs of provinces and centrally-run cities shall guide units and enterprises to comply with such law regulations./.