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THE
MINISTRY OF FINANCE
THE MINISTRY OF LABOR, WAR INVALIDS AND SOCIAL AFFAIRS
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SOCIALIST
REPUBLIC OF VIET NAM
Independence - Freedom – Happiness
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No.16/2000/TTLT-BTC-BLDTBXH
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Hanoi,
February 28, 2000
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JOINT CIRCULAR
GUIDING THE IMPLEMENTATION OF FINANCIAL REGIMES FOR
VIETNAMESE LABORERS AND SPECIALISTS SENT ABROAD TO WORK FOR A DEFINITE TIME
UNDER THE GOVERNMENT’S DECREE No.152/1999/ND-CP OF SEPTEMBER 20, 1999
In furtherance of the
Government’s Decree No.152/1999/ND-CP of September 20, 1999 on sending
Vietnamese laborers and specialists (hereinafter referred to as laborers)
abroad to work for a definite time, the Finance Ministry and the Ministry of
Labor, War Invalids and Social Affairs hereby jointly guide the implementation
of a number of financial regimes as follows:
A. GENERAL
PROVISIONS
1. Subject to this
Circular are labor-supplying enterprises and laborers who are sent abroad to
work for a definite time in the forms stipulated in Articles 2 and 3 of the
Government’s Decree No.152/1999/ND-CP of September 20, 1999.
1.1. For laborers:
a/ Laborers shall have to pay
personal income tax as well as social insurance premiums, and enjoy the social
insurance regime under the current regulations of the State.
b/ Laborers who are sent abroad
to work for a definite time through labor-supplying enterprises shall have to
pay deposit money and service charges to the sending enterprises.
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1.2. For enterprises:
a/ Enterprises that fully meet
conditions stipulated in Clause 1, Article 5 of Decree No.152/1999/ND-CP, when
being granted licenses for sending laborers abroad to work for a definite time,
shall have to pay the licensing fee.
b/ Enterprises shall have to pay
management charges to contribute to enhancing the overseas labor management
work.
c/ Enterprises sending laborers
abroad to work for a definite time in form of labor-supply contracts shall be
entitled to collect deposit money and service charges from laborers.
2. The financial regimes
stipulated in this Circular shall also apply to subjects defined in Article 26
of Decree No.152/1999/ND-CP.
3. The Overseas Labor
Management Department of the Ministry of Labor, War Invalids and Social Affairs
shall exercise the unified management of the sending of Vietnamese laborers
abroad to work for a definite time; collect, manage and use the licensing fee,
management charges and fines of enterprises for the right purposes.
4. The collections on the
sending of Vietnamese laborers abroad to work for a definite time shall comply
with the provisions of this Circular.
5. Laborers and
enterprises that commit financial violations shall be handled according to the
provisions of this Circular.
B. SPECIFIC
PROVISIONS
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1. Deposit
money
Laborers, before going abroad to
work for a definite time through labor-supplying enterprises, shall have to
deposit a sum of money to such enterprises in order to ensure their performance
of the already concluded contracts.
The deposit amounts shall be
agreed upon by enterprises and laborers in contracts but shall not exceed the
levels stipulated in Appendix 01/LT to this Circular.
Laborers shall pay deposits to
enterprises within 15 days before their departure for overseas labor.
After fulfilling the contracts
and returning home, if not breaching the contracts and causing damage to the
employers and the sending enterprises, laborers shall be entitled to receive
back the entire deposit amounts and interests thereon according to the
stipulations of the State Treasuries. If laborers breach the contracts, thus
causing damage to the employers and the sending enterprises, their deposit
money shall be recouped according to the provisions of Clause 6, Section I,
Part B of this Circular.
2. Service
charges
Laborers who are sent to work
overseas shall have to pay service charges to the sending enterprises according
to the following stipulations:
a/ Where the contractual wages
paid by employers to the laborers do not cover the meals, accommodation, labor
accident insurance and medical insurance for the time the laborers work
overseas, the payable service charges shall not exceed 12% of their monthly
wages according to the contracts. Particularly for officers and crew members
working on board sea-shipping vessels, the service charge levels shall not
exceed 18% of the above-said wages.
b/ Where the contractual wages
cover the meals, accommodation, labor accident insurance and medical insurance,
which cannot be separated, the laborers shall have to pay service charges not
exceeding 8% of their monthly wages according to the contracts. For officers
and crew members working on board sea-shipping vessels, the payable service charge
levels shall not exceed 12% of the said wages.
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d/ Service charge payment procedures:
On the basis of the contracts concluded between the laborers and the
enterprises, the laborers shall pay service charges according to the provisions
of Point 3.1, Clause 3, Section II, Part B of this Circular.
3. Social
insurance
Laborers shall pay social
insurance premiums and enjoy the social insurance regime according to the
State’s current regulations.
4. Personal
income tax
Laborers with high incomes shall
have to pay personal income tax according to the State’s current regulations.
Where laborers work in the
countries that have signed agreements on avoidance of double taxation with
Vietnam, they shall only have to fulfil the income tax obligations according to
the provisions of such agreements.
5. Other
expenses
Laborers shall have to bear the
following expenses:
a/ Airfares from Vietnam to the
countries of their workplaces (except for cases of financial support by
employers).
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c/ The expense for dossiers and
procedures for working overseas according to the State’s current regulations.
After being selected for working
overseas, if laborers do not have the demand therefor, they shall have to bear
all expenses already paid by enterprises for their foreign language and
professional examinations for them as required by the contracts with foreign
partners as well as for vocational training for laborers before they are sent
to work abroad.
6. Handling
of violations
In the course of working
overseas for a definite time, if breaching contracts, laborers shall be dealt
with as follows:
- To pay material compensation
for damage caused to the employers according to laws of the host countries, and
to the sending enterprises.
- To pay all service charges,
social insurance premiums and personal income tax (if any) on the basis of the
contractual wage levels, and the payment duration shall be counted till the
date the laborers return home.
Where laborers have to terminate
their contracts ahead of time and return home due to objective causes (wars,
natural calamities, enterprise bankruptcy, poor health conditions...), they
shall not have to fulfil their financial obligations as from the date of
termination of the contracts.
II. FOR
ENTERPRISES
1.
Licensing fee for specialized business operations
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Enterprises shall be entitled to
account the licensing fee amount into the expenses for activities of sending
laborers to work abroad.
2.
Collection, management and payment of deposit money
Enterprises sending Vietnamese
laborers abroad to work for a definite time shall be allowed to collect the
laborers’ deposit money to ensure the latter’s performance of the concluded
contracts.
The deposit collection must be
clearly stated in the contracts signed by laborers with the sending enterprises
and effected within 15 days before the laborers’ departure for working overseas
labor.
a/ Deposit levels and modes:
On the basis of the concrete
conditions of each market, each contract and each specific labor subject,
enterprises shall reach agreement with laborers on the deposit levels, the
lump-sum collection before the latter’s departure or the gradual deduction from
the laborers’ monthly wages, provided that the total deposit amounts shall not
exceed the levels prescribed in Appendix 01/LT enclosed herewith.
b/ Deposit currency:
The deposit currency shall be US
dollar. Where the deposits are collected in Vietnam dong, the payable amounts
in USD shall be converted into the VN dong amounts according to the average
exchange rate on the inter-bank market announced by the State Bank of Vietnam
at the time of collection.
c/ Management of deposit money:
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The withdrawal of money from
these accounts shall be effected only when the concerned enterprises produce
minutes on contract liquidation with laborers to the State Treasuries where
they have opened their accounts. Where laborers fail to come for the contract
liquidation, the State Treasuries shall allow the withdrawal of their deposits
only when there is the written consent of the Overseas Labor Management
Department of the Ministry of Labor, War Invalids and Social Affairs.
d/ Settlement of deposit money:
After the laborers return to the
country, the concerned enterprises shall have to send them notices requesting
them come for liquidation of the concluded contracts. The settlement of deposit
money shall be carried out simultaneously with the liquidation of the contracts
signed between the sending enterprises and the laborers.
The laborers may authorize their
next of kin (with certification of the commune/ward People’s Committees) to
come to enterprises for the liquidation of the already concluded contracts.
+ Where the laborers do not
cause economic damages to enterprises, the latter shall have to refund them the
entire deposit amounts as well as the interests thereon according to the
stipulations of the State Treasuries where enterprises have opened their
accounts.
+ Where the laborers breach
contracts, thus causing economic damage to enterprises, the enterprises shall
have the right to recoup their deposit amounts and interests thereon according
to Clause 6, Section I, Part B of this Circular.
Enterprises shall have to refund
laborers the amounts of deposit (if any), left after recouping.
- Where laborers arbitrarily
terminate contracts ahead of time and do business illegally or 3 months after
enterprises send them notices the laborers still fail to come for contract
liquidation, the enterprises shall have the right to deduct their deposit amounts
and interests thereon according to the stipulations of Clause 6, Section I,
Part B of this Circular and report such to the Overseas Labor Management
Department of the Ministry of Labor, War Invalids and Social Affairs.
Enterprises shall have to oversee
the remaining deposit amounts (if any) at the State Treasuries.
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3. Service
charges
3.1. Service charges mean
enterprises’ turnover from the sending of Vietnamese laborers abroad to work
for a definite time.
- Enterprises shall collect
service charges from laborers according to Clause 2, Section I, Part B of this
Circular.
Laborers are paid in which currency
(local currency or USD) the service charges shall be calculated in that
currency according to the wage percentages, or calculated on the USD amounts
converted equivalently from the paid currency according to the exchange rate at
the time of calculation (corresponding to the time of wage payment to
laborers).
- Where the foreign employers
pay wages directly to laborers, enterprises may reach agreement with the
laborers to collect service charges: lump-sum collection in advance or
collection by installments in the course of performance of the contracts.
If enterprises collect service
charges from laborers in advance, the collection must be effected in Vietnam
dong according to the average exchange rate on the inter-bank market announced
by the State Bank of Vietnam at each time of money collection.
3.2. Use of service charges:
Enterprises shall use service charges to cover expenses for their labor export
activities according to the current financial management regime, including the
foreign language knowledge and professional skill examinations for laborers as
required by the contracts with foreign partners as well as the vocational
training for laborers before they are sent to work overseas.
4.
Management charges
a/ Management charge levels:
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Where enterprises send laborers
abroad to work in form of construction contracting or subcontracting, overseas
product-sharing joint-venture or overseas investment, the management charge
level shall represent 0.5% of the total wage fund to be paid to laborers.
Enterprises may account the
management charges into the expenses for activities of sending laborers abroad
to work for a definite time.
b/ Mode of payment:
Enterprises shall temporarily
pay the management charges to the Overseas Labor Management Department of the
Ministry of Labor, War Invalids and Social Affairs when registering contracts
on sending Vietnamese laborers abroad to work for a definite time. The sum of
money to be temporarily paid shall be determined on the basis of registration
of the number of laborers, wage levels and working time of laborers under
contracts and shall be settled annually.
5.
Reporting regime
a/ Periodically and annually,
their enterprises shall have to make and send to the Overseas Labor Management
Department of the Ministry of Labor, War Invalids and Social Affairs the
following reports:
+ The report on the collections
and remittances in the first 6 months of the year as well as the whole year,
respectively on July 15 of the current year and January 30 of the subsequent
year at the latest.
+ The sum-up report on the
financial situation of labor exporting activities, on January 30 of the
subsequent year at the latest.
+ The report on the plan of the
subsequent year on the basis of the performance situation in the first 9 months
of the current year, on October 20 of the current year at the latest.
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6.
Handling of violations
Enterprises shall have to pay
compensation for damage caused to laborers due to their or the foreign
partners’ breaches of the contracts according to Vietnamese laws and laws of
the host countries, and at the same time be handled as follows:
a/ A fine of between 200,000 VND
and 1,000,000 VND for one of the following cases:
- Collecting deposit money in
excess of the prescribed levels, improperly collecting service charges
improperly, making the collection not according to the prescribed time for
collection.
- Late remittance of the
collected deposit amounts into the State Treasuries as prescribed.
- Late submission of the reports
according to the prescribed time-limits.
b/ A fine of between 1,000,000
VND and 3,000,000 VND and possible suspension of the sending of Vietnamese
laborers abroad to work for a definite time or withdrawal of operation
licenses, for one of the following cases:
- Repeating the violations
mentioned at Point (a) above.
- Collecting the laborers’
deposits when there are not yet or no contracts with foreign partners.
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- The laborers complain or take
action against enterprises for their failure to strictly comply with the
State’s current regimes and policies as well as the agreed terms when
liquidating the labor contracts.
c/ Where serious consequences
are caused, the violators shall be administratively disciplined or have their
cases transferred to the competent bodies for penal liability examination.
7. 6
months after the laborers are selected to be sent to work overseas, if
enterprises fail to send them abroad, they must notify the laborers of the
reasons therefor. In that case, if the laborers have no more demand to work
overseas or the enterprises cannot send them to work overseas, the enterprises
shall have to refund the laborers all advance collections, including the
airfares, deposits, service charges, social insurance premiums and overseas
management charges (if any).
III. REGIME OF
MANAGEMENT OF LICENSING FEE, MANAGEMENT CHARGES AND FINES
1. The Overseas Labor
Management Department of the Ministry of Labor, War Invalids and Social Affairs
shall be entitled to collect licensing fee, management charges and fines paid
by enterprises according to the provisions of this Circular. All these
collections shall be managed and used according to specific regulations of the
Finance Ministry.
2. The administrative
expenses paid by laborers who are sent abroad to work for a definite time under
individual contracts must be included in the general balance of the annual
financial plan of the provincial/municipal Labor, War Invalids and Social
Affairs Service.
C.
ORGANIZATION OF IMPLEMENTATION
1. This Circular takes
effect as from December 1st, 1999 and replaces Inter-ministerial Circular
No.05/LB-TC-LDTBXH of January 16, 1996 and the other legal documents contrary
to this Circular.
2. In the course of
implementation, if any problems arise, the ministries, branches, localities,
enterprises and laborers are requested to report them to the Finance Ministry
and the Ministry of Labor, War Invalids and Social Affairs for study and
settlement.
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FOR THE MINISTER
OF LABOR, WAR INVALIDS AND SOCIAL AFFAIRS
VICE MINISTER
Nguyen Luong Trao
FOR THE MINISTER
OF FINANCE
VICE MINISTER
Pham Van Trong
APPENDIX 01/LT
REGULATIONS ON MAXIMUM DEPOSIT LEVELS
(Issued
together with Joint Circular No.16/TTLT-BTC-BLDTBXH of February 28, 2000)
No
Countries,
regions
Maximum
deposit levels
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Japan, the Republic of Korea,
Taiwan
Airfares
for one-way trips from Vietnam to the countries of workplaces according to
the fare rates set by Vietnam Airline and 3-month contractual wages
2.
Middle-East and African
countries
Airfares
for one-way trips from Vietnam to the countries of workplaces according to
the fare rates set by Vietnam Airlines and one-month contractual wages
3.
Other countries
Airfares
for one-way trips from Vietnam to the countries of workplaces according to the
fare rates set by Vietnam Airlines and 2-month contractual wages
4.
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3-month
contractual wages