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THE
MINISTRY OF LABOUR, INVALIDS AND SOCIAL AFFAIRS
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SOCIALIST
REPUBLIC OF VIETNAM
Independence - Freedom - Happiness
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No.:
17/2009/TT-BLDTBXH
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Hanoi,
May 26, 2009
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CIRCULAR
AMENDING,
SUPPLEMENTING A NUMBER OF POINTS OF CIRCULAR NO.21/2003/TT-BLDTBXH DATED
SEPTEMBER 22, 2003 GUIDING THE IMPLEMENTATION OF A NUMBER OF ARTICLES OF DECREE
NO.44/2003/ND-CP DATED MAY 09, 2003 OF THE GOVERNMENT ON LABOUR CONTRACTS
Pursuant to the Decree
No.44/2003/ND-CP dated May 09, 2003 of the Government detailing the
implementation of a number of Articles of the Labour Code on labour contracts;
Pursuant to the Decree
No.127/2008/ND-CP dated December 12, 2008 of the Government detailing and
guiding the implementation of a number of Articles of the Social Insurance Law
concerning unemployment insurance;
Pursuant to the Decree
No.152/2006/ND-CP dated December 22, 2006 of the Government guiding a number of
Articles of the Law on Social Insurance regarding compulsory social insurance;
Pursuant to the Decree
No.186/2007/ND-CP dated December 25, 2007 of the Government defining the functions, tasks, powers and
organizational structure of the Ministry of Labor, Invalids and Social Affairs;
Ministry of Labor, Invalids and Social
Affairs amends, supplements a number of points of Circular
No. 21/2003/TT-BLDTBXH dated September 22, 2003 guiding the implementation of a
number of Articles of Decree No.44/2003/ ND-CP dated May 09, 2003 on labour
contracts (hereinafter referred to as Circular No.21/2003/TT-BLDTBXH) as
follows:
Article 1. Amending clause 2,
Item II, Circular No.21/2003/TT-BLDTBXH as follows:
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a) Social insurance: from the
effective date of this Circular to 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 stipulates the increase of level to pay health insurance for
employers, the government’s provisions shall be complied with.
c) Annual vacation: 4%.
d) Travel expenses when on leave
due to mutual agreement in the labor contract.
Article 2. Amending clause 3,
Item III, Circular No.21/2003/TT-BLDTBXH as follows:
“3. The method of calculation
and payment of termination allowances as follows:
a) Formula for calculating the
termination allowance in each enterprise:
Money
for termination allowance
=
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x
Wage
used as a basis for calculation of termination allowances
x
1/2
In which:
- Total time working in the
enterprise to calculate termination allowance (per year) is determined under
clause 3, Article 14 of Decree No.44/2003/ND-CP May 9, 2003 of the Government, except
for the time of paying unemployment insurance as stipulated in Decree
No.127/2008/ND-CP dated December 12, 2008 by the Government. In case the total
time worked at the enterprise to calculate termination allowance with odd
months (including cases where the employee has worked at the enterprise for
full 12 months or more but the total time worked in enterprise to calculate the
termination allowance under 12 months) shall be rounded as follows:
From full 01 month to less than
06 months is rounded up to 1/2 year.
From full 06 months to less than
12 months is rounded up to 01 year.
- The salary used as a basis for
calculating termination allowances is salary or wages under the employment
contract, calculated as an average of six months preceding the termination of
labor contracts, including wages or salary of ranks, positions and regional
allowance, position allowances (if any).
b) Some specific cases:
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The salary used as a basis for
calculating termination allowances is the salary or wages under the labor
contract calculated the average of six months preceding the termination of the
last labor contracts.
Example 1: Mr. Nguyen Van A
worked continuously under three labor contracts at Company X: The first labor
contract is with a term of 12 months, made from 01/01/2005 until 31/12/2005;
the second labor contract is with a term of 36 months, conducted from
01/01/2006 to 31/12/2008; the third labor contract is the indefinite-term
contract , performed from 01/01/2009 to 31/12/2010, then Mr. A has terminated
all, the average salary of the six months preceding the termination of the
third labor contract is 2.5 million dong. From 01/01/2009 to 31/12/2010, Mr A
continuously has paid unemployment insurance as prescribed (two years). Company
X has not paid termination allowance upon termination of each labor contract,
thus the total working time calculated termination allowance of Mr. A is 4
years (six years of working subtracting two years of paying unemployment
insurance). The salary used as a basis for calculating the termination
allowance is 2,500,000 VND. A termination allowance of Mr. A is 5,000,000 VND
(2,500,000 x 4 years x 1/2).
- Laborers who work for
state-owned companies but had time to work according to the staff regime and
also with working time under labor contract, then the enterprise shall add both
stages to calculate the termination allowance.
The salary used as a basis for
calculating termination allowances is the salary or wages under the labor
contract calculated the average of six months preceding the termination of the
last labor contracts.
Example 2: Ms. Tran Thi B,
worked at Company Y from 01/4/1991 until 31/01/1994 under the staff regime and
from 01/02/1994, she transferred to work under labor contract regime. On
31/10/2009, Ms. B terminated her labor contract. Total working time of Ms. B in
the company Y is 223 months. From 01/01/2009 to 31/10/2009, Ms. B continuously
has paid unemployment insurance. Salary calculated the average of the six
months preceding the termination of labor contract is 2,800,000 VND. Thus,
working time calculated termination allowance of Ms. B is 213 months, rounded
up to 18 years (223 months subtracting 10 months of paying unemployment
insurance) and the termination allowance is 25.2 million VND (18 years x
2,800,000 VND x 1/2).
- The laborers worked in many
state-owned companies due to transfer of work before the date of January 01,
1995; the termination allowance is calculated by working time in each
state-owned company. The salary used as a basis for calculating termination
allowances for employees at each enterprise is the salary or wages under the
labor contract calculated the average of six months preceding the termination
of labor contract in the last state-owned company. The last state-owned company
shall pay the entire amount of termination allowance to laborers, including the
termination allowance is under the responsibility of the state-owned companies
that the laborers have worked before being transferred before January 01, 1995,
then send a notice upon Form 3 attached to this Circular to request to refund
the amount that the companies have been paid as substitute. Where state-owned
companies that have been paid as substitute have terminated their operations,
the state budget shall reimburse the termination allowance which was paid as
substitute under the guidance of the Ministry of Finance.
Example 3: Mr. Le Viet C, work
under the staff regime at company P from 01/9/1990 until 31/08/1992 (2) years,
from 01/9/1992 to 31/8/1994 transferred to work under the staff regime at
company Q (2) years, from 01/9/1994 transferred to work under labor contract in
the Company S until the termination of labor contract on 31/08/2009 (15 years).
Average wage of 6 months preceding the termination of labor contract in the
Company S is 2,500,000 VND. Mr. C has paid unemployment insurance continuously
from 01/01/2009 until 31/08/2009 (8 months). Termination allowance of Mr. C is
calculated in each company as follows:
At Company P, it is 2,500,000
VND (VND 2,500,000 x 2years x 1/2).
At Company Q, it is 2,500,000
VND (VND 2,500,000 x 2 years x 1/2).
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Company S is responsible for
full payment of termination allowance as 23,125,000 VND to Mr. C, and then
Company S shall notify Company P and Company Q for refunding the amount paid as
substitute.
- If, after the merger,
consolidation, division of enterprise, transfer of ownership or management
rights or rights to use enterprise assets for which the laborers terminate their
labor contracts, then the next employer is responsible for adding all period
that the employees have worked for the enterprise and for the preceding
employer to calculate to pay termination allowance to the employees. The salary
used as a basis for calculating termination allowances is the salary or wages
under the labor contract calculated the average of six months preceding the
termination of the last labor contract.
For the state-owned companies
implementing the restructuring plans or change of ownership (transformed into a
member limited liability company, equitization, assignment, and sale) shall
apply the provisions of the State for these cases.
Example 4: Ms. Vu Van D worked
for the state-owned company N under the labor contract from 01/6/1994 until
01/6/2005, then the State-owned Company N equitized and become the shareholding
company N' (her working time in the state-owned company N is 11 years) and Ms.
D continued to work at the shareholding company N' until 01/6/2009, she
terminated the labor contract (her time working at the shareholding company N'
is 4 years). Average wage of 6 months preceding the termination of labor
contract at the shareholding company N' is 2,400,000 VND. Ms. D has paid
unemployment insurance continuously from 01/01/2009 to end on 31/05/2009 (5
months). Thus, termination allowance that the shareholding company N' required
to pay is 18 million dong (VND 2,400,000 x 15 years x 1/2), which includes the
payment for the period that she worked for the State-owned company N (11 years)
and the payment for the period that she worked for the shareholding company N’
(3 years 7 months rounded up to 4 years)
Article 3. Implementation
provisions:
1. This Circular takes effect 45
days after its signing date. Annulling clause 2, Item II and clause 3 Item III,
Circular No.21/2003/TT-BLDTBXH dated September 22, 2003 The Ministry of Labour,
Invalids and Social Affairs.
2. Method of calculating
termination allowance provided in Article 2 of this Circular is applied from
January 01, 2009 (the date that Decree No.127/2008/ND-CP dated December 12,
2008 of the Government took effect).
3. Not to apply the
method of calculating termination allowance provided in this Circular to calculate the termination allowance for the
cases of termination of labor contract prior to January 01, 2009.
In the course of
implementation, should any problems arise, reflect to the Ministry of Labour -
Invalids and Social Affairs for timely guidance and supplementation.
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FOR
MINISTER
DEPUTY MINISTER
Pham Minh Huan