The situation of businesses violating obligations to pay social, health, and unemployment insurance premiums has affected the rights of workers (Illustrative image)

On August 15, 2019, the Judicial Council of the Supreme People's Court issued Resolution No. 05/2019/NQ-HDTP (Resolution No. 05) guiding the application of Articles 214, 215, and 216 since these are new offenses, first stipulated in the Penal Code to be uniformly applied in practice.

In implementing Resolution No. 05, on January 22, 2020, the VSS issued Official Letter No. 239/BHXH-PC guiding provincial and municipal social security agencies to receive, process information, prepare, and submit petitions for prosecution.

Implementation Results

Since the Penal Code of 2015 came into effect, in many localities, provincial and municipal social insurance agencies have advised the Provincial People's Committees to pay attention to and direct the enhanced implementation of collection, development of participants, and reduction of arrears in social insurance, health insurance, and unemployment insurance contributions. Since September 2019, when Resolution No. 05 took effect, provincial and municipal social insurance agencies have actively and proactively implemented it, especially after receiving guidance from VSS on preparing petitions for prosecution.

Illustrative image (internet)

From 2018 to the end of 2023, the entire VSS sector has submitted 417 petitions for prosecution to investigating agencies, including 34 petitions under Article 214 regarding Social Insurance Fraud and Unemployment Insurance Fraud, 4 petitions under Article 215 regarding Health Insurance Fraud, and 379 petitions under Article 216 regarding Evading Social, Health, and Unemployment Insurance Contributions. In 2023 alone, the sector generated 26 prosecution petitions (17 under Article 214, 1 under Article 215, and 8 under Article 216).

To date, 15 cases have been prosecuted, including 8 effective judgments ordering individuals and organizations to enforce judgments totaling 2,690,508,989 VND, of which social security agencies have recovered 2,381,982,535 VND from enforcement, accounting for 88.5% of the amount to be enforced; 220 cases were not prosecuted as they were determined not to constitute criminal offenses, lacked violations, or were transferred for administrative processing; etc.

Difficulties and Challenges

During the process of compiling and submitting prosecution petition files, local social security agencies encountered several specific difficulties and challenges:

Firstly, local Police agencies determined that the act of late payment did not meet the criteria for criminal offenses due to the absence of deceitful intent or other fraudulent schemes.

Practical work in submitting prosecution petition files showed that most actions reviewed and documented by social security agencies were identified as instances of late payment. In these cases, employers had fully declared the number of participants, the amount to be paid, and deducted the insurance premiums from employees' salaries for Social, Unemployment, and Health Insurance. However, these actions were not considered criminal offenses by the Police agencies due to the absence of fraudulent intent or other deceptive schemes, thus failing to meet the criteria for criminal offenses as stipulated in Article 216(1).

Secondly, regarding the criterion of "being penalized for administrative violations but still committing offenses"

Investigative agencies did not accept cases where Administrative Penalties were issued by social security agencies for late payment, as they did not meet the criteria for constituting criminal offenses as stipulated. Additionally, Administrative Penalty decisions identified the entity responsible as the employer, making it difficult to pursue individuals.

Moreover, regarding the criterion of "being penalized for administrative violations but still committing offenses," there are different interpretations: It could mean either instances where the same offense subject to an administrative penalty was repeated, but the employing entity failed to pay the fines (meeting the criterion of exceeding 6 months for 10 individuals or 50 million VND) or instances where the offense was repeated after being penalized administratively (where the employing entity had previously paid or not paid the fines specified in the administrative penalty decision).

Thirdly, in cases where the employing entity fully declared the number of participants and the amount to be paid but failed to make payments (citing difficulties in business operations and absence of fraudulent intent), investigative agencies suggested "The entity owes dues due to difficulties, requesting civil lawsuits according to legal regulations." However, initiating lawsuits by trade union organizations is currently facing many obstacles, making it practically unfeasible due to difficulties in implementing regulations on employee authorization and the practical application of trade union operations.

Illustrative image (internet)

Up to the present, there have been no cases related to Article 216 brought to trial as Police agencies determined that the committed offenses did not meet the criteria for constituting criminal offenses, lacking conditions for prosecution. Social security agencies have encountered numerous difficulties in identifying evasion of payment for the basis and premise for criminal prosecution for the offense of evading payment. Additionally, according to Article 216, only legal entities can be prosecuted, making it difficult to apply to individuals due to the lack of regulations on administrative penalties for Social and Health Insurance payment evasion for individuals who are managers, executives, or legal representatives of the employing entity.

Recommendations and Proposals

To enhance the effectiveness and efficiency of law enforcement regarding Social, Unemployment, and Health Insurance payments and contribute to fulfilling the objectives set out in Resolution No. 28-NQ/TW, ensuring the legitimate rights of workers, preventing and strictly handling violations of Social, Health, and Unemployment Insurance obligations, it is necessary to study and formulate specific provisions related to late payments and payment evasion for Social, Unemployment, and Health Insurance in the draft amendments to the Social Insurance Law, Health Insurance Law, and related legal documents to ensure consistency with administrative and criminal law regulations and the practical organizational and implementation situation.