Vietnam will then join Thailand’s social insurance policy, while Singapore still only requires foreign workers to pay social security. This decree could make Vietnam less attractive for foreign workers.
On a monthly basis, contribution rates will be as follows:
1. Contribution rates for employers
Employers will contribute 17.5 percent of their employees monthly salary, meaning that:
03 % will go in the sickness and parental insurance benefit fund;
14 % will go to the retirement and death insurance benefit fund, only from 1 January 2022;
0.5 % will go to the occupational accident and disease benefit fund.
2. Contribution rates for employees
As for foreign employees, from 2022, contribution rates will include a payment of 8 percent of their income to the retirement and death benefit fund.
However, if an employee does not work and does not receive wages for at least fourteen (14) working days he is not required to pay the social insurance contribution for this month.
Finally, employees will be exempted of the compulsory social insurance in two cases:
The employee is an intra-company transferee, meaning that he has been temporarily but for at least twelve (12) months, reassigned to the established commercial presence of his foreign enterprise in Vietnam.
The employee reaches the retirement age provided by the labor code.
As a matter of fact, this decree does not always seem appropriate, as expats usually pay social insurance in their home country or may already have the medical coverage provided by their company.