EMPLOYMENT AND LABOR ARTICLES

New Provisions On Occupational Accidents Compensation Into Effect From March 20th 2015

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From March 20th 2015, employees who suffer from workplace accidents or occupational illness shall be compensated by their employer or receive allowances corresponding to provisions of law.

 (1) Occupational accident and illness compensation:

Employees are entitled to receive compensation for work-related accident or occupational illness in one of the following case:

  • The employee loses 5% or more of his/her working capacity or die resulted from occupational accidents, except for when such accident happened mainly due to his/her fault following the conclusion of a investigation report on occupational accident (including the event in which the employee has an accident while undertaking his/her duty or abiding by the employer’s lawful administration outside the scope of the enterprise, although such accident was a result from another person’s fault or it is not possible to identify the person who caused it);
  • The employee suffering from occupational illness following the conclusion of the Medical Evaluation Association or of a competent state agency shall be compensated in circumstances below:
    • Died of an occupational disease while working or before being transfered to another job, resigning, dismissal, or retiring;
    • Lost 5% or more of working capacity resulted from the occupational disease following a result of periodic work-related disease’s examination.

An employer must compensate an employee for each of the labor accidents. The employer can not cumulate previously occurred accidents. An indemnification by the employer for the employee who suffers from work-related disease should be paid for each time the employee is affected by the disease and follows the following principle: for the first time affected by the disease, the indemnification will be based on the rate (%) of declining working capacity following the first medical examination result; from the second time onwards, it will be based on the difference of the rate of declining working capacity comparing to the previous adjacent assessment results.

The amount of indemnification is determined as follows:

  • For employees whose working capacity is declined by 81% or more or whose deaths resulted from labor accidents or occupational diseases: at least equals to 30 months of salary;
  • For employees whose working capacity is declined by 5% to 10%: at least equals to 1.5 months of salary;
  • For employees whose working capacity is declined by 11% to 80%, the indemnification for each 1% increased rate shall be added 04 months of salary. Employers may look up the amount of indemnification in the table of indemnification or calculate using the following formula:

Indemnification = 1.5 + {(a – 10) x 0,4}

In which:

  • Indemnification: the amount of indemnification for the employees whose working capacity is declined by 11% or more (calculation unit: month(s) of salary)
  • 1.5: The indemnification rate in case of working capacity declined by 5% to 10%;
  • a: The rate (%) of the declined working capacity of an employee suffer from a labor accident or occupational disease;
  • 0.4: Coefficient indemnification for the rate of  declined working capacity increased by 1%.

 (2) Labor accident allowance

An employee who has an labor accident and lose 5% or more of his/her working capacity or dies will be given allowance in the following circumstances:

  • The labor accident is completely caused by employee’s fault following a conclusion in the such accident’s investigation report;
  • The accident happens to employee when he/she is going from home to work or back at a reasonable place and time (including the case where the accident is resulted from a third person’s fault or the person in fault cannot be identified).

A labor accident’s allowance shall be paid for each of the accident and cannot be cumulated in the previous occurred accidents.

The allowance shall be calculated following these priciples:

  • For employees whose working capacity is declined by 81% or more or dies in an labor accident or occupational disease: at least equals to 12 months of salary;
  • For employees whose working capacity is declined by 5% to 10%: at least equals to 0.6 months of salary;
  • For employees whose working capacity is declined by 11% to 80%: look up the amount of allowance in the table of indemnification or calculated following this formula:

Allowance = Indemnification x 0.4

In which:

  • Allowance: The allowance that paid for an employee whose working capacity is declined by 10% or more (unit: months of salary)
  • Indemnification: the amount of indemnification for the employees whose working capacity is declined by 10% or more (calculation unit: month(s) of salary)

Moreover, PLF also make a note for enterprises that the amount of indemnification or allowance mentioned above is the minimum amount. The employer is encouraged by the Government to compensate or give allowance at the higher level. In addition to the indemnification and allowance for labor accidents and occupational diseases, the employee is still entitled to social insurance’s regime for labor accidents and occupational diseases under the regulations on social insurance (only if the employees participate in compulsory social insurance).

PLF Law Firm 

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