Circular No. 35/2016/TT-BLDTBXH guiding the implementation of policies for employees when state-owned public institutions are transformed into joint-stock companies pursuant to Decision No. 22/2015/QĐ-TTg dated June 22, 2015 of the Prime Minister.

CIRCULAR

GUIDELINES FOR IMPLEMENTING POLICIES FOR EMPLOYEES WHEN STATE-OWNED INSTITUTIONS ARE CONVERTED INTO JOINT-STOCK COMPANIES PURSUANT TO DECISION NO. 22/2015/QĐ-TTg OF JUNE 22, 2015 OF THE GOVERNMENT PRIME MINISTER

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Pursuant to Decree No. 106/2012//2012/ND-CP of the Government on the functions, tasks, powers, and organizational structurePursuant to Decree No. 61/2015/NĐ-CP dated July 9, 2015 of the Government on employment support policies and the National Employment Fund

Pursuant to Decision No. 22/2015//2015/QĐ-TTg of the Government Prime Minister on converting state-owned institutions into joint-stock companiespart companies;

Upon the proposal of the Director of the Department of Labor - Invalids and Social Affairsforeign eAt the proposal of the Director of the Department of Planning and Finance

To implement the directiveof Deputy Prime Minister Vu Dinh Hue at document number 2934/VPCP-ĐMDN dated April 28, 2016 of the Government Office, the Minister of Labor, Invalids and Social Affairs issues this Circular guiding the implementation of policies for employees when state-owned institutions are converted into joint-stock companies pursuant to Decision No. 22/2015/QĐ-TTg of June 22, 2015 of the Government Prime Minister.This Circular guides the implementation of dividing the surplus balance of money from the award fund, welfare fund, and income from the reserve fund for stabilizing income; policies for purchasing preferential shares and additional shares; policies for redundant employees when state-owned institutions are converted into joint-stock companies pursuant to Decision No. 22/2015/QĐ-TTg of June 22, 2015 ofthe Government Prime Minister on converting state-owned institutions into joint-stock companies (hereinafter referred to as Decision No. 22/2015/QĐ-TTg).part 1. Employees working in state-owned institutions at the time of conversion into joint-stock companies (hereinafter referred to as converted state-owned institutions), including:a) Civil servants, managerial staff; 22/2015/b) Staff working under employment contracts;

Article 1. Scope of Regulation

c) Workers working under labor contracts as prescribed in Decree No. 68/2000/ND-CP dated November 17, 2000 of the Government on implementing the labor contract system for certain types of work in administrative agencies and state-owned institutions;d) Workers working under labor contracts as prescribed in the Labor Code.

Article 2. Applicability

2. Other agencies, organizations, and individuals related to the implementation of policies for employees as stipulated in this Circular.

Redundant employees

are those whose names appear on the list of employees of the converted state-owned institution (currently working or waiting for work) at the time of conversion into a joint-stock company, and the converted state-owned institution has taken all measures but cannot arrange work for them.

The employee utilization plan

is the plan for reorganizing employees established by the converted state-owned institution, comprising the main contents prescribed in Article 46 of the Labor Code.

Employees whose names appear on the regular employee list of the converted state-owned institution include:

Article 3. Explanation of Terms

1. currently working, listed on the payroll and contributing to social insurance of the converted state-owned institution; currently studying with the approval of the institution; currently on sick leave, maternity leave, treatment for work-related injuries or occupational diseases according to laws on labor and social insurance; currently on unpaid leave not due to their fault; on unpaid leave with the consent of the head of the institution; temporarily suspended from duty or detained according to the decision of the competent authority; temporarily exempted from performing employment contracts or labor contracts. is a person listed in the labor roster of the public service unit being converted (currently working or on standby) at the time of transferring to a joint-stock company, where the public service unit being converted has taken all measures but cannot arrange employment.

2. Labor utilization plan is the labor rearrangement plan established by the public service unit being converted, including the main contents prescribed in Article 46 of the Labor Code.

3. The regular employees listed in the labor roster of the public service unit being converted include: those currently working and listed in the payroll and contributing to social insurance of the public service unit being converted; those sent by the unit for study or agreed by the unit to go for study; those on sick leave, maternity leave, treatment of work-related injuries or occupational diseases according to the laws on labor and social insurance; those temporarily suspended from work without fault on their part; those on unpaid leave with the consent of the head of the unit; those temporarily suspended from duty or detained, arrested pursuant to the decision of the competent authority; those temporarily suspended from performing the labor contract or employment contract.

Article 4. Allocation of surplus funds from incentive funds, welfare funds, and income from the income stabilization reserve fund

1. Employees whose names appear on the list of regular staff of public service units at the time of conversion (the valuation date of the public service unit, which is the accounting closure date and financial report preparation date to determine the value of the public service unit) shall be entitled to share in the surplus funds from the incentive fund and welfare fund (after covering excess expenditures beyond the prescribed limits for employees), and income from the income stabilization reserve fund (if any) based on their actual years of service (full 12 months) from the last recruitment date to the valuation date for converting the public service unit into a joint-stock company; the allocation of surplus funds from the incentive fund and welfare fund, and income from the income stabilization reserve fund for partial months of service shall be decided by the converted public service unit.

2. The period of employment of employees at the converted public service unit for sharing in the incentive fund, welfare fund, and income from the income stabilization reserve fund includes: time worked at the unit; probationary or trial periods before joining the unit (if any); time spent studying abroad on assignment by the unit; time off due to illness, maternity leave, treatment of work-related injuries or occupational diseases as stipulated by labor laws and social insurance regulations; weekly rest days and paid leave as stipulated by the Labor Code; time spent on trade union activities as stipulated by labor laws and trade union regulations; time off without fault of the employee; time suspended from duty or detained but later returned to work following a conclusion by a competent state authority that no crime was committed.

Article 5. Preferential share purchase policy and additional share purchase policy

1. Preferential share purchase policy

a) Employees whose names appear on the list of regular staff at the time of announcing the value of the converted public service unit shall be eligible to purchase shares at a preferential price based on their actual years of service in the state sector (full 12 months, excluding partial months) as provided for in Clause 1, Article 21 of Decision No. 22/2015/QĐ-TTg.

b) The actual years of service in the state sector for purchasing shares at a preferential price is the cumulative total of actual working years in the state sector up to the announcement date of the value of the converted public service unit, minus the time already counted for purchasing shares at a preferential price (in state-owned enterprises undergoing equitization or public service units converted into joint-stock companies) previously, and time already counted for retirement benefits, disability benefits, or one-time social insurance payments (if any).

c) Actual years of service in the state sector is the total actual working years of employees at the converted public service unit, government agencies, political organizations, political-social organizations, armed forces units receiving state budget salaries, state-owned enterprises holding 100% capital, and other public service units prior to joining the converted public service unit.

The calculation of actual years of service in the state sector shall be similar to the provisions set out in Clause 2, Article 4 of this Circular.

2. The policy for additional share purchases shall be implemented according to Article 21 of Decision No. 22/2015/QĐ-TTg and guidelines issued by the Ministry of Finance.

Article 6. Policy for surplus workers recruited for the last time to public service units converted before October 18, 2000

1. Surplus workers recruited for the last time to public service units converted before October 18, 2000 (the effective date of Government Resolution No. 16/2000/NQ-CP dated October 18, 2000 on streamlining the establishment of administrative agencies and public service units) at the time of approving the labor utilization plan shall enjoy the policy for surplus workers as stipulated in Clause 1, 2, 3, and 4 of Article 3 of Government Decree No. 63/2015/NĐ-CP dated July 22, 2015 on policies for surplus workers when restructuring state-owned joint stock companies (hereinafter referred to as Decree No. 63/2015/NĐ-CP).

2. The period of work with social insurance contributions serving as the basis for calculating support payments for male surplus workers aged from 55 to 59 and female surplus workers aged from 50 to 54 who have contributed to social insurance for at least 20 years (as provided for in point c, Clause 1, Article 3 of Decree No. 63/2015/NĐ-CP) and for male surplus workers aged over 59 but under 60 and female surplus workers aged over 54 but under 55 who have contributed to social insurance for at least 20 years (as provided for in point b, Clause 2, Article 3 of Decree No. 63/2015/NĐ-CP) is the period of mandatory social insurance benefits according to the laws on social insurance.

3. The period of work for calculating unemployment allowance and support payment for surplus workers as stipulated in Clause 4, Article 3 of Decree No. 63/2015/NĐ-CP shall be determined as follows:

a) For surplus workers recruited for the last time to public service units converted before January 1, 1995 (the effective date of the Labor Code 1994), the period of work for calculating unemployment allowance and support payment as stipulated in points a and b, Clause 4, Article 3 of Decree No. 63/2015/NĐ-CP is the total actual working period from the last recruitment to the public service unit conversion until retirement and the actual working period in the state sector prior to that (if any), minus the period during which the worker has participated in unemployment insurance and the period already counted for severance pay upon demobilization or discharge after completing military service (if any).

The actual working period in the state sector is determined as provided for in point c, Clause 1, Article 5 of this Circular.

b) For surplus workers recruited for the last time to public service units converted from January 1, 1995 onwards, the period of work for calculating unemployment allowance and support payment as stipulated in points a and b, Clause 4, Article 3 of Decree No. 63/2015/NĐ-CP is the total working period from the last recruitment to the public service unit conversion until retirement, minus the period during which the worker has participated in unemployment insurance and the period already counted for severance pay, demobilization allowance, or discharge allowance after completing military service (if any).

c) For surplus civil servants and public officials recruited for the last time to public service units converted from January 1, 1995 to December 3, 1998 (the effective date of Government Decree No. 96/1998/NĐ-CP dated November 17, 1998 on the dismissal allowance for cadres and civil servants), the period of work for calculating unemployment allowance and support payment as stipulated in points a and b, Clause 4, Article 3 of Decree No. 63/2015/NĐ-CP is the total actual working period from the last recruitment to the public service unit conversion until retirement and the actual working period at political organizations, political-social organizations, administrative agencies of the state, other public service units, and units under armed forces receiving state budget salaries prior to that, minus the period during which the worker has participated in unemployment insurance and the period already counted for severance pay, demobilization allowance, or discharge allowance after completing military service (if any).

d) For surplus civil servants and public officials recruited for the last time to public service units converted from December 3, 1998 to October 18, 2000, the period of work for calculating unemployment allowance and support payment as stipulated in points a and b, Clause 4, Article 3 of Decree No. 63/2015/NĐ-CP is the total working period from the last recruitment to the public service unit conversion until retirement, minus the period during which the worker has participated in unemployment insurance and the period already counted by the public service unit for severance pay, demobilization allowance, or discharge allowance after completing military service (if any).

4. The salary for calculating the allowance for early retirement for each year for surplus workers as stipulated in point b, Clause 1 of Decree No. 63/2015/NĐ-CP is defined as follows:

a) For the subjects specified in points a, b, and c, Clause 1, Article 2 of this Circular, it is the salary, salary allowances, and retained differences (if any) according to the job or position classified according to the provisions of Government Decree No. 204/2004/NĐ-CP dated December 14, 2004 on salary systems for cadres, civil servants, public officials, and armed forces personnel averaged over the last five years (60 months) before retirement.

b) For the subject specified in point d, Clause 1, Article 2 of this Circular, it is the average salary according to the labor contract (including: basic salary, salary allowances, and other additional items) of the last five years (60 months) before retirement.

5. The salary for calculating unemployment allowance and support payment for surplus workers as stipulated in Clause 4, Article 3 of Decree No. 63/2015/NĐ-CP is defined as follows:

a) For the subjects specified in points a, b, and c Clause 1 Article 2 of this Circular, it is the salary, allowance, and retention difference (if any) according to the job or position classified in accordance with Decree No. 204/2004/NĐ-CP dated December 14, 2004 of the Government on the wage system for civil servants, public officials, and armed forces personnel averaged over the last six months before retirement or leaving work.

b) For the subject specified in point d Clause 1 Article 2 of this Circular, it is the average salary under the labor contract (including: basic salary, allowance, and other supplementary items) of the last six months before retirement or leaving work.

The salary under the labor contract is the salary stipulated in Clause 1, Point a Clause 2 and Point a Clause 3 Article 4 of Circular No. 47/2015/TT-BLDTBXH dated November 16, 2015 of the Ministry of Labor, Invalids, and Social Affairs guiding the implementation of certain provisions on labor contracts, labor discipline, and material responsibility under Decree No. 05/2015/NĐ-CP dated January 12, 2015 of the Government detailing and guiding the implementation of certain contents of the Labor Code.

Article 7. Policy for surplus workers recruited for the last time into public service units converted from October 18, 2000 onwards.

1. Surplus workers recruited for the last time into public service units converted from October 18, 2000 onwards at the time of approval of the labor utilization plan shall be entitled to unemployment benefits in accordance with Clause 1 Article 4 of Decree No. 63/2015/NĐ-CP of the Government.

2. The working period for calculating unemployment benefits is the total actual working period from recruitment into the public service unit until retirement, minus the period during which the worker has participated in unemployment insurance, and the period already counted for payment of severance pay upon discharge or demobilization after completing military service (if any).

3. The salary basis for calculating the unemployment benefit regime shall be implemented in accordance with Clause 5 Article 6 of this Circular.

Article 8. Implementation organization

1. The Steering Committee for converting public service units shall be responsible for:

a) Directing public service units being converted to develop the labor utilization plan in accordance with Appendix 1 of this Circular, ensuring democracy, transparency, and participation of the representative organization of the workforce at the unit.

b) Compiling the labor utilization plan within the conversion plan of public service units and submitting it to the competent authority for approval.

c) Submitting the labor utilization plan for approval by the competent authority after receiving the decision approving the conversion plan of public service units; compiling and submitting the adjustment of the labor utilization plan (if any) to the competent authority for decision.

d) Directing public service units being converted to cooperate with the representative organization of the workforce at the base to disseminate and promote policies in accordance with the law to workers in converted public service units to ensure unified implementation; fully implementing policies for workers in accordance with this Circular.

2. The head of public service units being converted shall be responsible for:

a) Developing the labor utilization plan in accordance with the appendix issued together with this Circular, ensuring democracy, transparency, and participation of the representative organization of the workforce at the unit.

b) Cooperating with the representative organization of the workforce at the base to disseminate and promote policies to workers in converted public service units to ensure unified implementation; organizing the implementation of policies in accordance with this Circular.

c) Preparing lists and procedures for the Social Insurance Agency to implement social insurance, health insurance, and unemployment insurance regimes in accordance with regulations; paying all amounts related to workers' rights (if any); implementing policies for workers in accordance with this Circular.

d) Handing over lists and files of workers to the Board of Directors or General Director (Director) of the joint-stock company in accordance with Article 16 of Decision No. 22/2015/QĐ-TTg.

đ) Reporting the results of converting public service units into joint-stock companies to competent authorities in accordance with Appendix 3 issued together with this Circular within thirty days from the date of finalizing policies for workers. The report shall be made in seven copies sent to: the approving authority for the conversion plan; the Ministry of Labor, Invalids, and Social Affairs; the Ministry of Finance; the Department of Labor, Invalids, and Social Affairs, the upper-level trade union where the converted public service unit is headquartered; the Social Insurance Office where the enterprise pays social insurance, each office one copy, and one copy retained at the joint-stock company.

3. Managers of joint-stock companies converted from public service units shall be responsible for:

a) Cooperating with the head of public service units being converted and relevant agencies and units to implement policies for workers in accordance with this Circular.

b) Accepting and utilizing the number of workers transferred to work at the joint-stock company in the labor utilization plan and all related files of workers.

c) Agreeing to amend or supplement labor contracts or conclude new labor contracts in accordance with the Labor Law for workers who continue to be employed, workers sent for retraining to continue employment, and workers transferred to work part-time (if any) in the labor utilization plan.

d) Preparing lists, files, and procedures with relevant agencies for workers to continue participating in and implementing social insurance, health insurance, unemployment insurance, and other regimes for workers transferred to work at the joint-stock company in accordance with the law.

đ) Dividing the reserve fund for income stabilization up to the point of conversion into a joint-stock company that has not yet been used (if any) among workers working at the unit at the time of determining the value of the public service unit according to the number of years of service as stipulated in Clause 9 Article 8 of Decision No. 22/2015/QĐ-TTg and Article 4 of this Circular.

e) Inherit all rights, obligations, and responsibilities of the public service unit towards the number of employees transferred from the public service unit to the converted joint-stock company in accordance with the provisions of the law; in cases where employees terminate their employment or lose their jobs after the conversion into a joint-stock company according to the Labor Law, the employer shall be responsible for paying severance benefits or unemployment assistance for the time the employee worked for them and severance pay for the actual working time at the public service unit before its conversion, and the working time in the state sector prior to the last recruitment into the public service unit before December 3, 1998 for civil servants and officials, and before January 1, 1995 for employees under labor contracts before being recruited to work at the public service unit (if any).

g) Issue regulations on recruitment and utilization of labor; establish staffing norms, salary scales, and wage lists and implement wage adjustments; issue wage payment regulations, bonus regulations, labor rules; negotiate and sign collective labor agreements; develop, issue, and organize the implementation of internal rules and procedures to ensure safety and hygiene at work and comply with other labor laws.

4. The Social Insurance Office where the public service unit participates in social insurance has the responsibility to guide the converted public service unit in collecting social insurance and resolving social insurance benefits for surplus employees retiring early; guide the joint-stock company in implementing social insurance, health insurance, and unemployment insurance according to the provisions of the Social Insurance Law, Health Insurance Law, Unemployment Insurance Law, and this Circular.

5. Ministries, ministerial-level agencies, government-affiliated agencies, provincial People's Committees, municipal People's Committees directly under the central government, and the Board of Directors of the parent company of State-owned corporations and state-owned joint-stock companies that have public service units converting into joint-stock companies shall be responsible for:

a) Directing the Steering Committee for the conversion of public service units, the heads of the converted public service units, and the business managers of the joint-stock companies to implement the provisions of this Circular.

b) Urging, inspecting, and supervising the implementation of employee benefits as stipulated in this Circular.

c) Compiling and reporting on the implementation of employee benefits in converted public service units according to Appendix 4 issued together with this Circular and sending it to the Ministry of Labor - Invalids and Social Affairs and the Ministry of Finance for monitoring and supervision.

Article 9. Effective Date

This Circular takes effect from December 10, 2016.

During the implementation process, if there are any difficulties, please reflect them to the Ministry of Labor - Invalids and Social Affairs for supplementation and guidance./.