Changes in contribution requirements under vietnam law

The new Social Insurance Law, effective from July 1, 2025, has added many policies beneficial to self-employed workers. So, will the maternity and pension benefits for self-employed workers who participate in voluntary social insurance be improved compared to before? In this article, we would like to write about the updated social insurance regulations for new employees, so that readers can decide whether or not to participate in voluntary social insurance.

1.  Changes in contribution requirements under vietnam law

Currently, the law has not provided an official definition of self-employed workers. However, in reality, those who work without labor contracts and are not subject to mandatory social insurance are often considered self-employed (jobs such as street vending, selling lottery tickets, working as freelancers, etc.).

Self-employed individuals who want to enjoy social insurance benefits must participate in voluntary social insurance. During the implementation of the 2014 Social Insurance Law, the number of people participating in voluntary social insurance was low, partly due to the lack of attractiveness of the voluntary social insurance policy, the lack of short-term benefits for workers, and the very low level of support for participants.

The 2024 new rules impacting employer obligations for insurance (effective from July 1, 2025) has added many new policies on voluntary social insurance (especially regarding maternity benefits and retirement benefits) to encourage self-employed individuals to participate in voluntary social insurance.
 

New rules impacting employer obligations for insurance

2. Supplementing Maternity Allowance Policy

The 2024 Social Insurance Law (Articles 94, 95, 96, and 97) has added maternity allowance to the voluntary social insurance policy to increase its attractiveness and encourage workers (especially young people) to participate in voluntary social insurance to ensure their own social security.

The maternity allowance is 2 million VND for each child born and for each fetus that dies in utero or dies during labor, from 22 weeks of gestation onwards. Female workers from ethnic minorities or Kinh women whose husbands are from ethnic minorities and belong to poor households are also entitled to other support policies as stipulated by the Government.

The maternity allowance for voluntary social insurance is guaranteed by the state budget, meaning participants will not have to pay extra, thus attracting self-employed workers to participate (because their responsibilities don't increase, but their benefits are enhanced).

At the same time, the National Assembly has tasked the Government with deciding on adjustments to the maternity allowance level to suit the socio-economic development conditions and the state budget's capacity in each period, ensuring the best interests of voluntary social insurance participants (for example, adjusting the maternity allowance level upwards when inflation increases).

3. Relaxing the conditions for receiving a pension

The 2024 Social Insurance Law (Article 98) has shortened the social insurance contribution period to 15 years (compared to 20 years or more according to Article 73 of the 2014 Social Insurance Law). This new regulation will create opportunities for those who joined social insurance late or whose participation was discontinuous and had a short contribution period to receive a pension.

4. Increased Allowances for Longer Years of Social Insurance Contributions

The 2024 Social Insurance Law (Article 100) has added a provision stating that if an employee, having already met the eligibility requirements for a pension as stipulated in Article 98 of the 2024 Social Insurance Law, continues to contribute to social insurance, the allowance will be twice the average salary used as the basis for social insurance contributions as stipulated in Article 104 of the 2024 Social Insurance Law for each year of contribution exceeding the prescribed number, from the time they reach the legally prescribed retirement age to the time of retirement.

This new provision will ensure the rights of employees who are eligible for a pension but continue to participate in social insurance until retirement (encouraging employees to participate in legal updates affecting employee social insurance reporting even after meeting the eligibility requirements until retirement).

At the same time, with the regulation that employees with a longer social insurance contribution period than the number of years corresponding to a 75% pension entitlement rate (more than 35 years for male workers, more than 30 years for female workers) will receive a lump-sum benefit in addition to their pension, ensuring the rights of employees with longer social insurance contribution periods, in line with the principle of social security changes linked to hiring and onboarding (the more you contribute, the more you receive).
 

Legal updates affecting employee social insurance reporting

4. New Policy on Lump-Sum Social Insurance Benefits

The 2024 Social Insurance Law (Article 102) on lump-sum social insurance benefits has the following notable new points:

Firstly, employees who begin participating in social insurance from July 1, 2025 onwards will not be entitled to a lump-sum social insurance benefit. They will only be entitled to a lump-sum social insurance benefit in the following special cases:

• Reaching retirement age but not having contributed to social insurance for 15 years and not continuing to participate in social insurance.
• Employees who emigrate abroad to settle.
• Individuals suffering from cancer, polio, decompensated cirrhosis, severe tuberculosis, or AIDS.
• Individuals with a disability rating of 81% or higher; individuals with severe disabilities.

This new regulation will gradually address the issue of receiving a lump-sum social insurance payment as in the past. This will help workers maximize their long-term benefits upon retirement, contributing to a more stable life in old age.

However, for workers who contributed to social insurance before July 1, 2025, and have not continued contributing for 12 months but have not yet accumulated 20 years of contributions, they are entitled to receive a lump-sum social insurance payment.

Secondly, for workers who have reached retirement age but have not contributed to social insurance for 15 years, if they do not wish to receive a lump-sum social insurance payment, they can choose to receive a monthly allowance as stipulated in Article 23 of the 2024 Social Insurance Law.

This regulation will create favorable conditions for workers to choose to receive a monthly allowance, providing them with a regular income to help stabilize their lives.

Thirdly, for workers who emigrate to settle abroad; those suffering from cancer, polio, decompensated cirrhosis, severe tuberculosis, or AIDS; those with a disability of 81% or more; and those with severe disabilities, if they meet both the conditions for a pension and a lump-sum social insurance payment, they can choose to receive either a monthly pension or a lump-sum social insurance payment.

This new updated contribution policies for foreign and local workers  will allow workers to consider whether receiving a lump-sum social insurance payment or a monthly pension is better for their situation and make an appropriate decision. If you need more information, please do contact us

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