Resolution 68 implementing policies to support businesses and individuals impacted by COVID-19
To support businesses and individuals in Vietnam which have been impacted by COVID-19, especially in recent periods, the Vietnamese Government issued Resolution 68/NQ-CP on 1 July 2021. This Resolution implements policies to decrease and defer contribution payments into a number of Social Insurance funds, provides funding support for businesses, and facilitates allowances for employees, individuals and business households impacted by COVID-19.
Key elements of the Resolution are as follows:
1. Reduction in social insurance contributions for the occupational accidents and diseases fund
Employers are entitled to a 0% payment rate of their salary fund to the Insurance fund for Occupational Accidents and Diseases (one of the three funds that together comprise the compulsory Social Insurance contributions, and which ordinarily requires a contribution of 0.5% from the employer) for 12 months (from 1 July 2021 to 30 June 2022).
Employers are to use the reduction in contributions to the Occupational Accidents and Diseases Fund to support the employees against the COVID-19 pandemic.
Comment: we are waiting for more guidance from the Government on the mechanisms to apply this reduction in Social Insurance contributions, as well as specifics on the use of these funds.
2. Deferral of contributions to the retirement and death fund
Applicable enterprises
Employers who have paid full Social Insurance contributions or have temporarily suspended contributions to the Retirement and Death Fund (one of the three funds that together comprise the compulsory Social Insurance contributions, and which ordinarily requires a contribution of 14% from the employer and 8% from the employee) after April 2021 but are affected by the COVID-19 pandemic, resulting in a downsizing by 15% of their employees participating in Social Insurance (as compared to April 2021), including employees who cease working/suspend labour contracts/agree to unpaid leave.
Payment deferral period
Employees and employers are entitled to deferral of payment to the Retirement and Death Fund for 6 months from application submission.
For the cases entitled to the deferral according to Resolution 42/NQ-CP dated 9 April 2020 and Resolution 154/NQ-CP dated 19 October 2020 by the Government, if being eligible, they are still entitled for deferral per this Resolution, provided that the total deferral period does not exceed 12 months.
3. Training funding support
Applicable enterprises
Employers are entitled to financial support for training, re-training and improvement of vocational skills from the Unemployment Insurance Fund once:
- Fully paying Unemployment Insurance contributions for employees for 12 months or more up to the date of requesting support;
- Changing the structure or technology according to the provisions of Clause 1, Article 42 of the Labour Code: changes in the organisational structure, personnel rearrangement, processes, technology, equipment associated with the employer’s business lines, products or product structure;
- Having revenue of the preceding quarter before requesting support decreasing by 10% or more compared to the same period in 2019 or 2020; and
- Having a plan or cooperating with a vocational education institution in developing a plan for training, retraining and improving vocational skills and qualifications in order to maintain jobs for employees.
Entitlements and applicable period
The entitlement is maximum 1,500,000 VND per employee/month. Entitlement period is for a maximum support term of 6 months.
Applications for this support are to be submitted from 1 July 2021 to 30 June 2022.
4. Allowances for employees temporarily ceasing working without salary
Employees who temporarily cease working without salary for 15 consecutive days or more, in the period from 1 May 2021 to the end of 31 December 2021, by the reason of business operation cessation of the organisations they are working for, following the requirement of competent authority in response to COVID-19, and who participate in compulsory Social Insurances (up to the date right before their cessation date) are entitled to a lump- sum allowance of:
- 1,855,000 VND per person if the cessation period is 15 consecutive days or more
- 3,710,000 VND per person if the cessation period is 1 month or more
5. Allowances for employees suspended from work to implement COVID-19 quarantine
Employees working under labour contracts are entitled to a one-time support of 1,000,000 VND per person if they meet the following conditions:
- Suspended from work and subject to quarantine or in blocked areas at the request of a competent authority for 14 days or more during the period from 1 May 2021 to the end of 31 December 2021, and
- Participating in compulsory Social Insurance (up to the date right before the working cessation date)
Comments: note that according to the Clause 3, Article 99 of the 2019 Labour Code, the above applicable employees also are to receive negotiated salaries from employers for the cessation period, following the stipulated process. Further details are provided in the guidance from the Ho Chi Minh City Labour ｕｎｉｏｎ through Official Letter 420/LDLD-CSPL.
