Managers of enterprises and cooperatives who do not receive salaries are subject to compulsory social insurance under the new law, Mr. Phi asked, so the contribution level of the director of a single-member LLC is based on the salary for social insurance contributions or depends on the contribution level?

Foreign employees at Mr. Phi's company who marry Vietnamese people should be exempt from work permits and sign a labor contract with a fixed term of 2 years. He asked, does his company have to participate in social insurance for this foreign employee? If it does not have to pay social insurance for this foreign employee, does the company need to pay any amount for this foreign employee?

Regarding this issue, Quang Ngai Provincial Social Insurance responded as follows:

Based on Point a, Clause 1, Article 2 of the Law on Social Insurance 2024, employees working under indefinite-term labor contracts, fixed-term labor contracts with a term of 01 month or more, including cases where the employee and the employer agree on a different name but with content showing the paid work, salary and management, operation, and supervision of one party working part-time, with a monthly salary equal to or higher than the lowest salary used as the basis for compulsory social insurance payment are subjects participating in compulsory social insurance.

Based on Clause 5, Article 33 of the Law on Social Insurance 2024, in cases where the employee does not receive salary for 14 working days or more in a month, the employee does not have to pay social insurance for that month, except in cases where the employer and the employee have an agreement on paying social insurance for the employee that month.

Thus, in case an employee signs a labor contract to work under Point a, Clause 1, Article 2 of the Social Insurance Law 2024, he/she is subject to compulsory social insurance participation.

In case an employee works without salary for 14 working days or more in a month, he/she must pay social insurance according to the provisions of Clause 5, Article 33 of the Social Insurance Law 2024.

Selecting salary as the basis for compulsory social insurance payment

Subjects specified in Point n, Clause 1, Article 2 of the Social Insurance Law 2024: "Enterprise managers, controllers, representatives of state capital, representatives of enterprise capital as prescribed by law; members of the Board of Directors, General Directors, Directors, members of the Supervisory Board or controllers and other elected management positions of cooperatives and cooperative unions as prescribed by the Law on Cooperatives who do not receive salaries" are allowed to select salary as the basis for compulsory social insurance payment, but the lowest is equal to the reference level and the highest is 20 times the reference level at the time of payment (when the basic salary has not been abolished, the reference level specified in the Social Insurance Law is equal to the basic salary).

After at least 12 months of paying social insurance according to the selected salary as the basis for social insurance payment, employees are allowed to re-select salary as the basis for social insurance payment.

Foreign employees with contracts of 12 months or more must pay compulsory social insurance

Pursuant to Clauses 2 and 3, Article 2 of the Law on Social Insurance 2024:

"2. Employees who are foreign citizens working in Vietnam are subject to compulsory social insurance when working under a fixed-term labor contract with a term of 12 months or more with an employer in Vietnam, except in the following cases:

a) Transfer within the enterprise according to the provisions of the law on foreign employees working in Vietnam;

b) At the time of signing the labor contract, they have reached the retirement age as prescribed in Clause 2, Article 169 of the Labor Code;

c) International treaties to which the Socialist Republic of Vietnam is a member have other provisions.

3. Employers subject to compulsory social insurance include state agencies, public service units; agencies, units, and enterprises under the Army People, People's Public Security and key organizations; political organizations, socio-political organizations, socio-political-professional organizations, socio-professional organizations, other social organizations; foreign agencies, organizations, international organizations operating in Vietnam; enterprises, cooperatives, cooperative unions, business households, other organizations and individuals hiring and using labor under labor contracts".

Based on the above regulations, in case Mr. Hoi is subject to compulsory social insurance, the unit must participate in social insurance for employees according to regulations.