Circular No. 17/2009/TT-BLDTBXH amends and supplements certain points of Circular No. 21/2003/TT-BLDTBXH on labor contracts. It provides detailed regulations on the contribution rates for social insurance, health insurance, and annual leave for workers with a term of less than three months; and the method for calculating severance pay based on total time worked at the enterprise.
适用范围
Workers and employers
要点
- Workers with a term of employment under three months shall be paid an amount including social insurance, health insurance, annual leave, and travel expenses when taking annual leave.
- The social insurance contribution rate ranges from 15% to 18%, depending on the effective period of the Circular.
- Severance pay is calculated based on total time worked at the enterprise, excluding unemployment insurance contribution periods.
- Severance pay is calculated using the formula: Total time worked x base salary x 1/2.
- This Circular takes effect from the date of issuance and abolishes certain old regulations.
🌐 本文件的社会影响
- The positive impact is that workers benefit from social insurance, health insurance, and annual leave when working short-term.
- The negative impact is that enterprises must pay additional amounts to workers with short-term employment.
❓ 常见问题
What benefits do workers with a term of employment under three months receive?
They are paid social insurance, health insurance, annual leave, and travel expenses when taking annual leave.
What is the social insurance contribution rate?
From 15% to 18%, depending on the effective period of the Circular.
How is severance pay calculated?
Severance pay = Total time worked at the enterprise x base salary x 1/2.
When does this Circular take effect?
From the date of issuance of the Circular, abolishing certain old regulations.
Is the new calculation method for severance pay applicable to cases where labor contracts were terminated before January 1, 2009?
The new calculation method for severance pay does not apply to these cases.
全文
CIRCULAR
Amending and supplementing some points of Circular No. 21/2003/TT-BLDTBXH dated September 22, 2003 guiding the implementation of certain provisions of Decree No. 44/2003/NĐ-CP dated May 9, 2003 of the Government on labor contracts
___________________________
Pursuant to Decree No. 44/2003/NĐ-CP dated May 9, 2003 of the Government detailing and guiding the implementation of certain provisions of the Labor Code on labor contracts;
Based on Decree No. 127/2008/NĐ-CP dated December 12, 2008 of the Government detailing and guiding the implementation of certain provisions of the Social Insurance Law regarding unemployment insurance;
Pursuant to Decree No. 152/2006/NĐ-CP dated December 22, 2006 of the Government guiding certain provisions of the Social Insurance Law on mandatory social insurance;
Pursuant to Decree No. 186/2007/NĐ-CP dated December 25, 2007 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Labor, Invalids, and Social Affairs;
The Ministry of Labor, Invalids, and Social Affairs amends and supplements some points of Circular No. 21/2003/TT-BLDTBXH dated September 22, 2003 guiding the implementation of certain provisions of Decree No. 44/2003/NĐ-CP dated May 9, 2003 on labor contracts (hereinafter referred to as Circular No. 21/2003/TT-BLDTBXH) as follows:
Article 1. Amend Clause 2, Section II, Circular No. 21/2003/TT-BLDTBXH as follows:
"2. Labor contracts concluded with persons receiving monthly pension and persons working for less than three months shall, in addition to the salary based on the job, also include a payment calculated as a percentage (%) of the salary stipulated in the labor contract, including:
a) Social insurance: from the date this Circular takes effect until December 2009 is 15%; from January 2010 to December 2011 is 16%; from January 2012 to December 2013 is 17%; from January 2014 onwards is 18%.
b) Health insurance 2%. When the Government increases the contribution rate for health insurance for employers, it shall be implemented according to the Government's regulations.
c) Annual leave 4%.
d) Travel expenses during annual leave shall be agreed upon by both parties in the labor contract.
Article 2. Amend Clause 3, Section III, Circular No. 21/2003/TT-BLDTBXH as follows:
"3. Calculation and payment of severance pay:
a) Formula for calculating severance pay at each enterprise:
|
Severance pay amount |
= |
Total time worked at the enterprise for which severance pay is calculated |
x |
Base salary for calculating severance pay |
x 1/2 |
Where:
- Total time worked at the enterprise for which severance pay is calculated (in years) is determined according to Clause 3, Article 14 of Decree No. 44/2003/NĐ-CP dated May 9, 2003 of the Government, excluding the period of unemployment insurance contributions as stipulated in Decree No. 127/2008/NĐ-CP dated December 12, 2008 of the Government. In cases where the total time worked at the enterprise for which severance pay is calculated includes a fractional month (including cases where the employee has worked at the enterprise for at least 12 months but the total time worked at the enterprise for which severance pay is calculated is less than 12 months), it will be rounded off as follows:
From one month to less than six months, round up to half a year.
From six months to less than twelve months, round up to one year.
- Base salary for calculating severance pay is the average salary or wage stipulated in the labor contract over the six consecutive months immediately preceding the termination of the labor contract, including basic salary or wage, regional allowance, and position allowance (if applicable).
b) Some specific cases:
- Employees who have multiple labor contracts with one enterprise and have not received severance pay when terminating each contract shall have their working time under all contracts combined to calculate severance pay. If there is a labor contract terminated unilaterally by the employee in violation of the law, the working time under that contract shall not be counted towards severance pay.
The base salary for calculating severance pay is the average salary or wage stipulated in the labor contract over the six consecutive months immediately preceding the termination of the final contract.
Example 1: Mr. Nguyen Van A continuously worked under three labor contracts at Company X: the first contract had a term of 12 months, from January 1, 2005 to December 31, 2005; the second contract had a term of 36 months, from January 1, 2006 to December 31, 2008; the third contract was indefinite-term, from January 1, 2009 to December 31, 2010, when he terminated it. His average salary over the six consecutive months immediately preceding the termination of the third contract was 2,500,000 VND. From January 1, 2009 to December 31, 2010, Mr. A continuously paid unemployment insurance (for two years). Company X did not pay severance pay when terminating each contract, thus his total working time for severance pay calculation is four years (six years minus two years of unemployment insurance contributions). The base salary for calculating severance pay is 2,500,000 VND. Mr. A's severance pay is 5,000,000 VND (four years x 2,500,000 VND x 1/2).
- Employees who work for state-owned enterprises and have both tenure-based and contractual working periods shall combine both types of working periods to calculate severance pay.
The base salary for calculating severance pay is the average salary or wage stipulated in the labor contract over the six consecutive months immediately preceding the termination of the final contract.
Example 2: Ms. Tran Thi B worked at Company Y from April 1, 1991 to January 31, 1994 under tenure-based employment and switched to contractual employment from February 1, 1994. She terminated her labor contract on October 31, 2009. Her total working time at Company Y is 223 months. From January 1, 2009 to October 31, 2009, she continuously paid unemployment insurance. Her average salary over the six consecutive months immediately preceding the termination of her contract was 2,800,000 VND. Therefore, her working time for severance pay calculation is 213 months, rounded up to eighteen years (223 months minus ten months of unemployment insurance contributions), and her severance pay is 25,200,000 VND (eighteen years x 2,800,000 VND x 1/2).
- Workers who worked for multiple state enterprises due to job transfers before January 1, 1995 shall have severance pay calculated based on their time working at each state enterprise. The basis for calculating severance pay for workers at each enterprise is the average salary and wages stipulated in their labor contracts over the six consecutive months immediately preceding the termination of their labor contract with the last state enterprise. The last state enterprise is responsible for paying the entire amount of severance pay to the worker, including the portion of severance pay that should have been paid by state enterprises where the worker had previously worked before transferring jobs prior to January 1, 1995. Subsequently, the last state enterprise shall send notice according to Model No. 3 issued together with this Circular requesting reimbursement of the amounts already paid on behalf of the worker. In cases where the state enterprise that made the payment has ceased operations, the State budget shall reimburse the severance pay that was paid on behalf of the worker in accordance with the guidelines of the Ministry of Finance.
Example 3: Mr. Le Viet C worked under the establishment system at Company P from September 1, 1990 to August 31, 1992 (2 years), then transferred to work under the establishment system at Company Q from September 1, 1992 to August 31, 1994 (2 years), and thereafter switched to work under a labor contract at Company S until the termination of his labor contract on August 31, 2009 (15 years). The average salary of the six consecutive months immediately preceding the termination of his labor contract at Company S is VND 2,500,000. Mr. C has continuously contributed to unemployment insurance from January 1, 2009 to August 31, 2009 (8 months). Mr. C's severance pay is calculated separately for each company as follows:
At Company P is VND 2,500,000 (2 years x VND 2,500,000 x 1/2).
At Company Q is VND 2,500,000 (2 years x VND 2,500,000 x 1/2).
At Company S is VND 18,125,000 (14.5 years x VND 2,500,000 x 1/2).
Company S is responsible for paying the total severance pay of VND 23,125,000 to Mr. C, and subsequently notifying Companies P and Q to reimburse the amounts paid on behalf of Mr. C.
- In cases where, following mergers, consolidations, divisions, spin-offs, transfers of ownership, management rights, or usage rights of assets of enterprises, workers terminate their labor contracts, the subsequent employer shall be responsible for combining both the time the worker worked for themselves and the time worked for the immediate previous employer to calculate and pay severance pay to the worker. The basis for calculating severance pay is the average salary and wages stipulated in the labor contract over the six consecutive months immediately preceding the termination of the final labor contract.
For state enterprises implementing restructuring plans or conversion to ownership forms (becoming a single-member limited liability company, shareholding, transfer, sale), the provisions of the State shall apply to these cases.
Example 4: Ms. Vu Van D worked under a labor contract at State Enterprise N from June 1, 1994 to June 1, 2005, when State Enterprise N was converted into Joint Stock Company N' (time worked at State Enterprise N was 11 years), and Ms. D continued to work at Joint Stock Company N' until June 1, 2009, when her labor contract was terminated (time worked at Joint Stock Company N' was 4 years). The average salary of the six consecutive months immediately preceding the termination of her labor contract at Joint Stock Company N' is VND 2,400,000. Ms. D has continuously contributed to unemployment insurance from January 1, 2009 to May 31, 2009 (5 months). Therefore, the severance pay that Joint Stock Company N' must pay is VND 18,000,000 (15 years x VND 2,400,000 x 1/2), which includes the portion paid for the time Ms. D worked at State Enterprise N (11 years) and the portion paid for the time worked at Joint Stock Company N' (rounded to 4 years).
Article 3. Implementation Provisions:
1. This Circular shall take effect 45 days from the date of signature. Clause 2, Section II and Clause 3, Section III of Circular No. 21/2003/TT-BLDTBXH dated September 22, 2003 of the Ministry of Labor, War Invalids and Social Affairs are hereby abolished.
2. The calculation method for severance pay prescribed in Article 2 of this Circular shall be applied as of January 1, 2009 (the date on which Decree No. 127/2008/NĐ-CP dated December 12, 2008 of the Government takes effect).
3. The calculation method for severance pay prescribed in this Circular shall not be used to recalculate severance pay for cases where labor contracts were terminated before January 1, 2009.
Any difficulties encountered during implementation should be reported to the Ministry of Labor, War Invalids and Social Affairs for timely supplementary guidance./.
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