1. Overview of the 2024 Social Insurance Law
At its 7th session, the National Assembly officially passed the 2024 Social Insurance Law (referred to as SI Law 2024), which is set to take effect from July 1, 2025. With several significant changes, SI Law 2024 aims to expand social insurance coverage, improve employee benefits, and address the shortcomings of the 2014 Social Insurance Law (SI Law 2014).
Here are the key changes in SI Law 2024 that employees should be aware of:
2. Lowering the Age Requirement for Social Pension Benefits
One of the most notable changes in SI Law 2024 is the lower age requirement for receiving social pension benefits for elderly workers who do not receive a pension or social insurance allowance.
New Regulations:
- Vietnamese citizens aged 75 and above, or 70–75 years old from poor or near-poor households, will be eligible for social pension benefits if they do not receive a pension or other monthly social assistance.
- Minimum benefit level: Not less than 500,000 VND per month, as determined by the Government.
- Beneficiaries will receive free health insurance, and their families will receive a funeral allowance of at least 10 million VND upon their passing.
This regulation aims to provide financial support to elderly individuals without pensions, ensuring a more stable life.
3. Expansion of Mandatory Social Insurance Coverage
Compared to SI Law 2014, the new law expands the scope of mandatory social insurance coverage to include additional groups.
Newly Added Beneficiaries:
- Employees with labor contracts of at least one month, including part-time or flexible workers, must participate in social insurance if their salary meets the minimum contribution threshold.
- Workers without formal labor contracts but engaged in paid employment under supervision and management will also be required to participate.
- Business managers, controllers, and representatives of enterprise capital at parent companies are now subject to mandatory social insurance, even if they do not receive a salary.
Significance of this change:
- Prevents avoidance of social insurance contributions through alternative contract arrangements.
- Ensures better protection for flexible and informal workers.
4. Changes in Social Insurance Contributions During Sick Leave
SI Law 2024 introduces adjustments to protect employees’ social insurance benefits during extended sick leave.
New Regulations:
- Employees on sick leave for 14 days or more during their first month of work or the first month after returning to work: Must still pay social insurance for that month.
- Employees on sick leave for 14 days or more in other months: Are exempt from social insurance contributions, unless otherwise agreed with the employer.
These changes aim to balance employee rights and employer flexibility in social insurance contributions.
5. Lowering the Minimum Contribution Period for Pension Eligibility
A major improvement in SI Law 2024 is the reduction of the minimum contribution period required for pension eligibility.
New Regulations:
- The minimum contribution period for receiving a pension is reduced from 20 years to 15 years.
- The maximum benefit rate remains 75%, depending on the total contribution period.
- In the future, the Government may reduce the required period further to 10 years to enhance pension accessibility.
Benefits of this change:
- Increases access to pensions for those who start contributing later in life (e.g., at age 45 or above).
- Encourages long-term participation in social insurance
- Changes in Lump-Sum Social Insurance Withdrawals
SI Law 2024 tightens the conditions for lump-sum withdrawals to prevent mass withdrawals and ensure long-term benefits for employees.
- Employees who contributed before July 1, 2025: Can withdraw their lump-sum social insurance after 12 months of non-participation, if they have contributed for less than 20 years.
- Employees who start contributing from July 1, 2025, onward: Can only withdraw social insurance in special cases, such as permanent emigration, critical illness, or at least 81% work capacity reduction.
These changes encourage employees to retain their social insurance contributions for future pension benefits, reducing financial risks in old age.
- New Maternity and Occupational Accident Benefits for Voluntary Social Insurance Participants
To enhance the attractiveness of voluntary social insurance, SI Law 2024 introduces maternity and occupational accident benefits for voluntary participants.
- Female workers who give birth will receive a one-time allowance of 2 million VND per child.
- Participants will also be covered for occupational accidents and injuries.
Advantages:
- Encourages informal workers to participate in social insurance.
- Strengthens social safety nets for self-employed individuals.
. Conclusion
SI Law 2024 introduces significant reforms to expand benefits, increase coverage, and ensure a more inclusive social insurance system. These changes provide greater flexibility and protection for employees while maintaining the sustainability of the social insurance fund.
Key Highlights of SI Law 2024:
✅ Minimum pension eligibility reduced from 20 years to 15 years.
✅ Expanded coverage for flexible workers and business managers.
✅ New maternity and occupational accident benefits for voluntary participants.
✅ Stricter rules on lump-sum withdrawals to protect long-term benefits.
Understanding these changes will help both employees and businesses prepare for the new regulations when they take effect in 2025.
For legal consultation on social insurance policies, contact MLT Lawyers Lawfirm for professional support!