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National Assembly Vice Chair Nguyen Thi Thanh. (Photo: National Assembly)

The Deputy General Director of Vietnam Social Security (VSS) has assured that the unemployment insurance fund surplus of approximately 63 trillion VND ($2.6 billion USD) is sufficient to provide unemployment benefits for public employees and workers affected by organizational restructuring.

Balancing the unemployment insurance fund

During a session on January 6, the National Assembly Standing Committee reviewed the draft Amended Employment Law, which seeks to address the impact of political system streamlining on the unemployment insurance fund.

Nguyen Thuy Anh, Chair of the Social Affairs Committee, highlighted the absence of provisions in the draft law to address unemployment arising from restructuring government agencies.

This adjustment is necessary due to potential reductions in contributors to the fund and increases in beneficiaries.

Thuy Anh proposed adding principles and authorizing the Government to ensure fund stability during organizational changes.

National Assembly Vice Chair Nguyen Thi Thanh echoed concerns about the potential impact of restructuring on unemployment insurance, noting that approximately 100,000 public employees will be affected.

Provisions for unemployment benefits

Under Decree 178, public employees who lose their jobs due to restructuring and do not qualify for pensions are eligible for unemployment insurance benefits, including unemployment allowances and vocational training support.

Deputy General Director of VSS Le Hung Son stated that unemployment insurance primarily applies to public employees rather than civil servants. He also assured that the fund’s surplus ensures the availability of resources to address emerging needs.

In 2023, more than 1.049 million people received unemployment benefits, with 99.3% of payouts processed via personal bank accounts.

Son emphasized that the centralized nature of unemployment benefit distribution remains unaffected by administrative boundaries, ensuring smooth disbursements even under a restructured model.

Unemployment benefit framework

The draft law defines unemployment insurance as a mandatory mechanism supporting workers through job retention, training, counseling, job placement, and partial income replacement in case of job loss.

Key provisions include:

Monthly allowance: 60% of the average monthly salary used as the insurance contribution base for the six months prior to unemployment. The allowance is capped at five times the regional minimum wage.

Duration of benefits: Workers qualify for three months of benefits after contributing for 12-36 months. For every additional 12 months of contributions, one more month of benefits is granted, up to a maximum of 12 months.

Contributions exceeding 144 months are not carried forward.

Healthcare coverage: Workers receiving unemployment benefits are entitled to health insurance contributions from the unemployment insurance fund, even during suspension periods.

Nguyen Thi Huong, Director General of the General Statistics Office, underscored that the high realization rate of unemployment insurance payouts reflects investor confidence in Vietnam’s social security system.

The draft Amended Employment Law is scheduled for review and approval during the National Assembly’s 9th session.

Thu Hang