[HR COMPLIANCE UPDATE] - BASIS FOR DETERMINING MANDATORY SOCIAL INSURANCE CONTRIBUTION LEVELS FROM 01/07/2025

According to the provisions of the Law on Social Insurance 2024, from July 1, 2025, the monthly salary used as the basis for compulsory social insurance contributions is limited to the following minimum and maximum ranges:

• Lowest level: Equal to the reference level at the time of closing

• Highest level: 20 times the reference level

So how is the “reference level” understood?

Pursuant to Clause 13, Article 141, Law on Social Insurance 2024: “When the basic salary has not been abolished, the reference level prescribed in this Law is equal to the basic salary. At the time the basic salary is abolished, the reference level shall not be lower than that basic salary.”

Currently, according to Decree 73/2024/ND-CP, the basic salary applied is 2,340,000 VND/month.

Some additional notes from current regulations:

• For employees receiving salaries decided by the enterprise → the basis includes: salary, allowances and regular additional payments.

• For the group of subjects who are allowed to choose the salary as the basis for social insurance payment → must still comply with the above minimum - maximum framework and can only change after at least 12 months.

BUSINESSES NEED TO NOTE

• Ensure that the salary declared for social insurance payment for employees is within the valid range.

• Review the labor contract system, payroll and social insurance records to ensure compliance, avoid risks of administrative sanctions, collection and direct impact on employees' rights.

Faro Vietnam

• Email: service@farovietnam.com.vn

HANOI HEAD OFFICE

• Tel: + 84 24 3974 3091

HO CHI MINH CITY OFFICE

• Tel: + 84 28 3821 4654

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