Joint Circular No. 2/TT-LB guides the handling of policies for workers when state-owned enterprises are dissolved, including determining outstanding wages and social insurance, paying wages and social insurance, transferring jobs or training, resolving benefits for workers who do not meet retirement conditions, and using settlement funds to pay out.
Scope of application
Workers employed at state-owned enterprises being dissolved; the Dissolution Council of the enterprise; local labor management agencies; training and job introduction centers.
Key points
- Those determined to be owed wages and social insurance include those actually working for the enterprise at the time of dissolution announcement, those on leave due to objective reasons receiving wages or allowances; outstanding wages and social insurance are calculated from the unpaid period up to the date of the dissolution decision.
- The Dissolution Council prioritizes payment of outstanding wages and social insurance to workers before settling accounts with the State.
- Workers losing their jobs due to enterprise dissolution may be transferred to other positions or undergo training; other cases will be handled according to Decision No. 176-HĐBT dated October 9, 1989, of the Council of Ministers.
- Funds for payments to workers when enterprises dissolve shall come from remaining settlement funds after deducting necessary expenses; if insufficient, the enterprise must develop a plan to request financial support from the corresponding budget level (provincial or central).
- All documentation for payments to workers must be reviewed and settled with the Finance Department.
🌐 Social impact of this document
- Positive impact: Ensures workers' rights when enterprises dissolve, facilitating job transfers or training for those not meeting retirement conditions.
- Negative impact: High costs and complex implementation processes may pose difficulties for enterprises during dissolution.
❓ Frequently asked questions
How are workers losing their jobs when state-owned enterprises dissolve supported?
Workers losing their jobs may be transferred to other positions or undergo training. If seeking new employment, they should register with the local labor management agency for priority training and job placement.
How does the Dissolution Council pay outstanding wages and social insurance to workers?
The Dissolution Council determines the amount to be paid based on available funds, prioritizing payments before settling accounts with the State according to current regulations.
What should the enterprise do if settlement funds are insufficient to pay workers?
The Dissolution Council develops a plan to request financial support from the corresponding budget level (provincial or central) and submits it to the Labor-Finance Department at the same level for consideration.
What benefits do workers receive when they do not meet retirement conditions?
Workers not meeting retirement conditions will receive termination benefits, including a one-time allowance according to Decision No. 176-HĐBT dated October 9, 1989, of the Council of Ministers.
What responsibilities does the Dissolution Council have during the dissolution process?
The Dissolution Council is responsible from the initial stage to completion during the dissolution process, reporting all results to the State.
Full text
CIRCULAR OF THE JOINT MINISTRIES
LABOUR - WAR INVALIDS AND SOCIAL AFFAIRS - MINISTRY OF FINANCE
Guidelines for handling policies towards workers when state-owned enterprises are dissolved
The Council of Ministers has issued "Provisions on some basic points regarding the procedures for dissolving state-owned enterprises suffering severe losses" (attached to Decision No. 315-HĐBT dated September 1, 1990 of the Council of Ministers on rectifying and reorganizing production and business operations in state-owned economic units); the Ministry of Labour - War Invalids and Social Affairs and the Ministry of Finance provide guidance on some points concerning the resolution of policies for workers as follows:
I. METHODS FOR DETERMINING WAGES AND SOCIAL INSURANCE DUE TO BE PAID BY THE ENTERPRISE TO WORKERS.
AND IF THE ENTERPRISE STILL OWES, IT MUST PAY TO THE WORKER.
1. Determining wages and social insurance due to be paid to workers.
a) The subjects eligible for determination of wages and social insurance owed by the enterprise include:
- Those who are actually working for the enterprise at the time of dissolution announcement (including contractual employees whose employment contracts have not yet been terminated).
- Former cadres and workers of the enterprise who are currently on leave due to illness, maternity, work-related accidents, occupational diseases, retirement benefits before reaching retirement age, loss of working capacity, annual leave, temporary detention or suspension of duties with pay, or temporary cessation of work due to objective reasons with pay or allowances.
For those whom the enterprise has arranged to stop work without pay or allowances, or workers who left their jobs before the enterprise's dissolution date, they do not fall under the category of the enterprise owing wages.
b) The period during which the enterprise owes wages and social insurance is calculated from the time the enterprise fails to pay wages and social insurance to workers until the date of the enterprise dissolution decision.
c) The wages and social insurance owed by the enterprise to workers consist of wages and any additional allowances (if applicable) calculated according to the parameters specified in Decision No. 202-HĐBT dated December 26, 1988 of the Council of Ministers and Circular No. 1-TT/LB dated January 12, 1989 of the Joint Ministry of Labour - War Invalids and Social Affairs - Finance.
d) Social insurance benefits are calculated according to current State guidelines. In addition to the wages and social insurance that must be paid to workers as mentioned above, the enterprise must also contribute sufficient amounts for social insurance as stipulated by current regulations up until the date of the dissolution decision.
2. Payment of wages and social insurance owed by the enterprise to workers.
Based on the determination of wages and social insurance that the enterprise still needs to pay to workers, taking into account the available capital, the Enterprise Dissolution Council prioritizes payment of the wage and social insurance debt to workers; the payment and settlement with the State shall be carried out according to current regulations.
II. POLICIES FOR WORKERS AFTER THE ENTERPRISE DISSOLUTION DECISION.
DECISION DISSOLVING THE ENTERPRISE.
When the enterprise makes a dissolution decision, the policy and treatment for workers shall be handled as follows:
1. Workers may be transferred to other positions or undergo training.
- Workers who lose their jobs due to the enterprise's dissolution can be reallocated within the scope of their industry and locality by the heads of relevant sectors and the Chairmen of People's Committees at local levels for young, healthy workers with technical skills, professional qualifications, and high-level expertise where there is demand in other enterprises.
- For other cases, if seeking new employment is necessary, they should register with the local labour management agency or vocational training and job placement centers (if available) to consider priority training and retraining for employment in other state-owned enterprises (if needed) or in other economic sectors.
2. Handling policies for workers according to Decision No. 176-HĐBT dated October 9, 1989 of the Council of Ministers.
- Apart from those workers who are transferred or undergo training, the remaining workers will be handled according to the policy provisions set forth in Decision No. 176-HĐBT dated October 9, 1989 of the Council of Ministers and Circulars No. 18 and No. 19-LĐTBXH/TT dated October 21, 1989 of the Ministry of Labour - War Invalids and Social Affairs.
- The Enterprise Dissolution Council compiles a list of workers, categorizing them for policy and treatment as follows:
+ Workers meeting the conditions for retirement or loss of working capacity shall be treated according to the retirement or loss of working capacity policy as per Decision No. 176-HĐBT.
+ Workers not meeting the conditions for retirement or loss of working capacity shall be treated according to the termination allowance policy as per Decision No. 176-HĐBT.
3. Funding for payments to workers when the enterprise is dissolved.
- Based on the number of workers determined to be eligible for treatment under Decision No. 176-HĐBT, the Enterprise Dissolution Council calculates the amount to be paid to workers and staff.
- The Enterprise Dissolution Council uses the remaining liquidation funds after deducting necessary expenses as stipulated in Clause 14 of the provisions attached to Decision No. 315-HĐBT dated September 1, 1990 of the enterprise to make payments to workers.
- If the remaining liquidation funds of the enterprise are insufficient to cover worker payments, the Enterprise Dissolution Council develops a plan to request financial support from the Chairman of the Provincial People's Committee (for local enterprises) or the Minister in charge of the central ministry (for central enterprises), simultaneously sending it to the local Labour and Finance agencies for consideration and resolution. The budget level responsible for dissolving the enterprise will reasonably allocate funding for this purpose according to State guidelines.
- If there are surplus funds remaining after paying workers, these must be remitted to the State budget according to the guidelines in Circular No. 54/TC-CN dated November 13, 1990 of the Ministry of Finance.
- All documentation related to payments made to workers, the Enterprise Dissolution Council is responsible for reviewing and settling these expenditures with the Finance Department.
III. IMPLEMENTATION
- The resolution of policies for workers when state-owned enterprises are dissolved is a complex socio-economic issue, therefore it is recommended that ministries and provincial people's committees organize and strictly direct the implementation of this Decision. The Department of Labor - Invalids and Social Affairs and the Department of Finance need to strengthen coordination to advise the provincial people's committees, city people's committees, and special administrative regions on directing and implementing this matter.
- Units classified for dissolution must complete their documentation to facilitate the procedures upon the dissolution decision.
- The liquidation council of the enterprise is responsible from the initial stage to the completion of the dissolution process and must report all results to the State.
- This Circular takes effect from the date of issuance. Any difficulties encountered during implementation should be reported to the Joint Ministry for study and resolution.
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