Due to the need for introducing or selling seasonal products, companies usually hire seasonal workers. This situation has resulted in the appearance of enterprises signing contracts with employees of less than 1 month. However, many people do not know whether can they enjoy the basic benefits of a worker for a contract of less than 1 month. In this article, LSX legal firm introduces: “Do contracts under 1 month have to pay insurance in Vietnam?”
Legal grounds
- Law on Social Insurance 2014
- Labor Code 2019
How to enter into a contract when hiring laborers to work for less than 1 month?
An employment contract means an agreement between an employee and an employer on a paid job, salary, working conditions, and the rights and obligations of each party in the labor relations.
The contracting parties shall conclude the contract in writing and make it into 2 copies. The employee will keep a copy, and the employer will keep the other.
An employment contract in the form of electronic data conformable with electronic transaction laws shall have the same value as that of a physical contract.
Both parties may conclude an oral contract with a term of less than 01 month, except for the cases specified in Clause 2 Article 18, Point a Clause 1 Article 145, and Clause 1 Article 162 of the Labor Code.
Article 13 of the Labor Code 2019 (effective from January 1, 2021) stipulates that a document with a different name also considered an employment contract if it contains the agreement on the paid job, salary, management, and supervision of a party.
Currently, the Labor Code 2019 no longer has regulations on seasonal labor contracts or jobs with a term of less than 12 months. Article 20 of this Code stipulates two types of contracts: labor contracts with an indefinite term and labor contracts with a fixed term.
- An indefinite-term employment contract means a contract in which the two parties neither fix the term nor the time of termination of the contract;
- A fixed-term employment contract means a contract in which the two parties fix the term of the contract for a duration of up to 36 months from the date of its conclusion.
Besides, for a fixed-term labor contract of less than 1 month, the parties can enter into an oral labor contract (not required to enter into a written contract).
Do parties have to enter into a labor relation of less than 1 month with a written contract?
Article 14 of the Labor Code 2019 provides for the forms of a labor contract as follows:
Article 14. Forms of employment contract
An employment contract shall be concluded in writing and made into two copies, one of which will be kept by the employee, the other by the employer, except for the case specified in Clause 2 of this Article.
An employment contract in the form of electronic data conformable with electronic transaction laws shall have the same value as that of a physical contract.
Both parties may conclude an oral contract with a term of less than 01 month, except for the cases specified in Clause 2 Article 18, Point a Clause 1 Article 145, and Clause 1 Article 162 of this Labor Code.
Accordingly, with a labor contract of less than 1 month, the employee and the employer can agree orally without making a written contract or through electronic data, except for the following cases:
- Sign a contract with a group of employees aged full 18 years or older through an authorized person in the group.
- Hiring employees under the age of 15.
- Hiring domestic workers.
How many times can you sign a labor contract with a term of under 1 month?
According to Point b, Clause 1, Article 20 of the Labor Code 2019, a labor contract of less than 1 month is a type of labor contract with a fixed term.
When this contract expires, if the parties wish to continue to perform the work, they must sign a new contract under Clause 2, Article 20 of the Labor Code 2019:
“Within 30 days from the expiration date of the employment contract, both parties shall conclude a new employment contract. Before such a new employment contract is concluded, the parties rights, obligations, and interests specified in the old employment contract shall remain effective”
Parties can sign a fixed-term contract again or sign an indefinite-term labor contract.
Besides, they can sign labor contracts of less than 1 month many times in the following cases:
- Firstly, hiring people to act as directors in state-owned enterprises.
- Secondly, hiring elderly workers.
- Thirdly, hiring foreign workers to work in Vietnam.
- Fourthly, hiring employees who are members of the management board of the employee representative organization at the grassroots level during the term of the contract may be extended until the end of the term.
In case the employer does not sign a new contract but still lets the employee continue to work, after 30 days, a labor contract of less than 1 month will become an indefinite term contract.
Thus, for most employees, enterprises can only sign 2 times for contracts of less than 1.
However, in special cases such as elderly employees, foreign workers, persons employed as directors in domestic enterprises, and members of the Board of employee representative organizations, they can sign the contract more than once.
Do contracts under 1 month have to pay insurance in Vietnam
Clause 1, Article 2 of the Law on Social Insurance 2014 stipulates that the subjects who must participate in compulsory social insurance include:
- Persons working under indefinite-term labor contracts, definite-term labor contracts, seasonal labor contracts, or contracts for given jobs with a term of between full 3 months and under 12 months, including also labor contracts signed between employers and at-law representatives of persons aged under 15 years in accordance with the labor law.
- Persons working under labor contracts with a term of between full 1 month and under 3 months.
- Cadres, civil servants, and public employees.
- Defense workers, public security workers, and persons doing other jobs in cipher agencies.
- Officers and professional army men of the people’s army; officers and professional non-commissioned officers and officers and technical noncommissioned officers of the people’s public security; and persons engaged in cipher work enjoying salaries like army men.
- Non-commissioned officers and soldiers of the people’s army; noncommissioned officers and soldiers on definite-term service in the people’s public security; the army, public security, and cipher cadets who are entitled to cost-of-living allowance.
- Vietnamese workers working abroad under the labor contracts defined in the Law on Vietnamese Workers working abroad under the labor contract.
- Salaried managers of enterprises and cooperatives.
- Part-time staff in communes, wards, and townships.
So, if the working time is less than one month, they will not be eligible to participate in compulsory social insurance. If you work for one month or more, you will be subject to compulsory social insurance.
Legal service of LSX Legal Firm
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- Legal advice related to new regulations;
- Representing in drafting and editing documents;
- We commit the papers to be valid, and legal for use in all cases;
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Related questions
In most cases, employees have to pay social insurance contributions for full 20 years or more.
Particularly for female employees who work as commune-level cadres and civil servants or are part-time workers in communes, wards, or townships, they only need to pay social insurance premiums for the full 15 years or more.
According to Article 88 of the Law on Social Insurance:
In case employers meet with difficulties and have to suspend their production or business activities, making them and their employees unable to pay social insurance premiums, the payment to the retirement and survivor allowance fund may be suspended for 12 months at most;
Upon the expiration of the time limit for payment suspension specified at Point a of this Clause, employers and employees shall continue paying social insurance premiums and make supplementary payment for the suspension period. The supplementary amount paid for the suspension period is not subject to late payment interest under Clause 3, Article 122 of this Law
According to Article 17 of the Law on Social Insurance 2014, delaying the payment of social insurance or unemployment insurance premiums belong to the prohibited acts.
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