Who pays insurance for all contracts for foreign teachers? Currently, our company employs many foreign workers. Do we have to pay social insurance, health insurance; unemployment insurance for all contracts for foreign teachers, including Contracts under 12 months? Let us learn about this topic with LSX law firm as follow:
Who pays insurance for all contracts for foreign teachers?
The company must pay compulsory insurance such as health insurance, social insurance. The content of the contract you provide stipulates; that they must pay the payment contents at the minimum level required by law.
However, according to Official Letter No. 1064/LDTBXH-BHXH of the Ministry of Labor, War Invalids and Social Affairs; foreign workers are eligible to participate in compulsory social insurance; when they fully meet the following conditions:
– Have a work permit, practice certificate, or practice license issued by a competent Vietnamese agency;
– Having an indefinite-term labor contract or a definite-term labor contract of full 01 year; or more with an employer in Vietnam;
– Under 60 years old for men and under 55 years old for women;
– Not subject to transfer within the enterprise; including managers, executives, experts, and technical workers working in foreign enterprises; has been recruited by a foreign enterprise for at least 12 months before and was sent to work at a commercial presence in Vietnam.
Therefore, employees who sign labor contracts with a definite term of less than 1 year with the company are not required to pay compulsory social insurance.
In addition, Point c, Clause 2, Article 20 of the Labor Code 2019 stipulates:
“c) In case two parties sign a new labor contract which is a definite-term labor contract; it can only sign one more time, after If the employee continues to work; they must sign an indefinite-term labor contract; except for the labor contract for the person who is hired as a director in a state-owned enterprise and the case specified in Clause 1; Article 149, Clause 2, Article 151, and Clause 4, Article 177 of this Code”
Clause 2, Article 151 of the Labor Code 2019 stipulates as follows:
“The term of the labor contract for foreign workers working in Vietnam must not exceed the term of the work permit. When employing foreign workers to work in Vietnam, the two parties may agree to enter into multiple definite-term labor contracts.
For health insurance for foreign teachers
According to Clause 2, Article 1 of the Law on Health Insurance 2008; as amended by the Law on Health Insurance, amended in 2014.
The Health Insurance Law applies to domestic and foreign organizations and individuals in Vietnam related to health insurance. Therefore, participation in health insurance applies to all subjects living and working in Vietnam, regardless of Vietnamese or foreigners.
Clause 1, Article 17 of Decision 595/QD-BHXH clearly states that an employee working under an indefinite term labor contract; a labor contract with a term of 3 months or more, an enterprise manager; Management and administration of cooperatives with salary; working in agencies, units, organizations, etc. must participate in health insurance (HI). Therefore, for labor contracts of total 3 months or more, the company must pay health insurance for employees.
In addition, point b, Clause 1, Article 20 of the Labor Code 2019 stipulates:
A definite-term labor contract is a contract in which the two parties determine the term; and the time of termination of the contract’s validity within a period not exceeding 36 months from the effective date of the contract.
Thus, a definite-term contract under this provision does not specify a minimum term; but only a maximum term of no more than 36 months. Therefore, customers can agree with employees who sign a labor contract of less than 3 months. They will not be subject to health insurance payment according to the above regulations.
For unemployment insurance for foreign teachers
According to Clause 4, Article 3 of the Employment Law 2013; Unemployment insurance is a regime aimed at compensating a part of an employee’s income when they lose a job; supporting workers in vocational training, job maintenance, and job search based on contributions to the Unemployment Insurance Fund.
According to Clause 1, Article 43 of the Employment Law 2013; the subjects participating in unemployment insurance include employees who must participate in unemployment insurance when working under a labor contract; or a working contract as follows:
– An employment contract or an indefinite term employment contract;
– A labor contract or a fixed-term work contract;
– Seasonal labor contracts or for a certain job with a term of from full 3 months to less than 12 months.
In addition, according to Clause 1, Article 3 of the Employment Law 2013; “Employees are Vietnamese citizens aged full 15 years and older, have working capacity and have a need to work.”
Therefore, the term “employee” defined in the Employment Law 2013 is understood as a Vietnamese citizen aged 15 years; or older, capable of working and wishing to work.
Thus, foreigners working in Vietnam are not subject to compulsory participation in unemployment insurance.
In addition, the annual health insurance that you and your employees agree on in the labor contract is the type of insurance; you can choose to pay or not to pay for employees because this is not compulsory insurance.
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