- Reporter: Since the Government’s Decree No. 143/2018 / ND-CP dated October 15, 2018 detailing the Law on Social Insurance and the Law on Occupational Safety and Health regarding compulsory social insurance for foreign employees working in Vietnam took effect, what is the total amount of social and health insurance contributions paid by firms? Compared to before the policy took into force, are there any changes to social insurance payments?

+ Mr Dinh Duy Hung: In accordance with Decree No. 143/2018 / ND-CP, foreign workers in Vietnam are subject to compulsory social insurance payment from December 1, 2018. This was the first time Vietnamese law regulated compulsory social insurance for foreign citizens working in Vietnam. The compulsory social insurance payment for this group is in line with a roadmap as follows:

- From December 1, 2018 to December 31, 2021, employers pay the full amount equal to 3.5 percent of monthly salary to the funds for sickness, maternity and industrial accident - occupational diseases;

- From January 1, 2022 onwards, 25.5 percent of the monthly salary will be paid to the funds for sickness, maternity, industrial accidents and occupational diseases, retirement and survivor benefits. Up to 17.5 percent of which will be paid by employers and 8 percent by workers.

According to the VSS’s statistics, as of February 28, 2019, total social insurance payment by workers who are foreign nationals working in Vietnam was 100.792 billion VND.

- Reporter: According to the VSS’s statistics, how many businesses are required to pay social insurance for foreign workers? And how many foreign workers are required to join social insurance?

+ Mr Dinh Duy Hung: According to the VSS statistics, as of February 28, 2019 (three months since Decree No. 143/2018 / ND-CP took effect), the total number of units paying social insurance for foreigners nationwide were 8,730 with 51,524 workers.

According to the Ministry of Labour, War Invalids and Social Affairs’ estimate, there are more than 80,000 foreign employees working in Vietnam, most of them received work permits (accounting for more than 90 percent of total licensed foreign employees).

After more than three months of implementing Decree No.143/ND-CP, 64 percent of workers from this group have participated in compulsory social insurance, which is a positive result for the implementation of a new policy.

In the near future, realising Decree No.143/2018/ND-CP; Document No.5300/LDTBXH-BHXH dated December 17, 2018 of the Ministry of Labour, Invalids and Social Affairs on the implementation of Decree No.143/2018/ND-CP, the Vietnam Social Security has directed its chapters in localities to coordinate with State management agencies on labour to grasp the number of foreign workers subject to compulsory social insurance and guide enterprises using foreign employees to carry out the decree.

- Reporter: What are the impacts of the social insurance policy for foreign employees on the business environment in Vietnam, as well as the attraction of high quality workers to the country? Are there any difficulties in implementing social insurance for foreign workers and what need to be changed?

+ Mr Dinh Duy Hung: The social insurance policy for migrant workers have been carried out in many countries around the world. In the context of extensive and intensive economic integration at present, it is necessary for Vietnam to begin implementing compulsory social insurance for foreign employees to ensure their rights and interests, contributing to creating equality between domestic and foreign employees.

This is a positive factor to create a favourable business environment and attract high-quality workers to Vietnam. Because it is a new policy, the implementation of social insurance for foreign workers faces some difficulties as follows:

The first difficulty is identifying foreign employees entitled to the new policy. Decree No.143/2018/ND-CP, which took effect from December 1, 2018, is a new policy without guidance circulars.

Recently, the VSS has recorded some problems raised by enterprises using foreign workers and it is directing its chapters in localities to work with State management agencies on labour to record the number of foreign workers subject to compulsory social insurance and guide enterprises using foreign employees to implement the decree.

The second difficulty is language barriers. Foreign employees in Vietnam are from multiple countries with different languages.

Their identification documents are written in foreign languages, leading to difficulties in social insurance transactions.

The third difficulty is the possibility of double payment: Foreign employees working in Vietnam could join social insurance in their countries and vice versa. Regarding this issue, the Government is directing the Ministry of Labour, Invalids and Social Affairs to negotiate for the signing of bilateral agreements on social insurance to avoid the double payment of contributions./.