| SUMMARY OF LATEST GUIDANCE
PAYMENT OF WAGES AND BENEFITS FOR EMPLOYEES DURING WORK SUSPENSION | SUSPENSION OF SOCIAL INSURANCE CONTRIBUTIONS | DETAIL GUIDANCE ON SUSPENSION OF SOCIAL INSURANCE CONTRIBUTIONS TO BUSINESSES IN THE NEGATIVE IMPACT OF COVID 19 | | | Policies and orientations will be applied synchronously from the Government of Vietnam for assisting businesses in the negative impact of Covid 19, VIVA would like to summarize and update the important notices untill March 31, 2010 specifically as follows:
OBJECTIVES AND SOLUTIONS FROM THE GOVERNMENT
1. Temporarily stopping to contribute to the pension fund and death fund.
2. Tax agencies and Customs offices will not periodically inspect in 2020 toward agencies and enterprises if showing no signs of violation..
3. Increasing the Family Circumtance Deductions level of Personal Income Tax in 2020.
4. Promulgating policies on Corporate Income Tax, supporting small and medium-sized enterprises, then submitting to the Government in March 2020.
5. Reducing fees and charges for those are affected by Covid-19, or proposing plans for reduction of fees and charges.
6. Drafting the decree to extend paying tax and land rent, exempting from late tax payment up to 30,100 billion VND.
7. Deploying support credit package up to 250,000 billion VND on credit extension, rescheduling, interest rate reduction and exemption, keeping debt groups in order to support clients who are affected by Covid-19.
8. Fully disbursement of public investment capital up to 700,000 billion VND.
In order to get the above incentives and supports, each business needs to meet specific conditions and legal requirements. Please kindly contact our Specialists for more details or to directly coordinate related to procedures and conditions.
REGARDING GUIDANCE ON SUSPENSION OF SOCIAL INSURANCE CONTRIBUTIONS BY ENTITIES AFFECTED BY COVID-19
On March 17, 2020, Social Security Administration of Vietnam issued Official letter No. 860/BHXH-BT providing guidance on suspension of social insurance contributions by entities affected by COVID-19.
Suspension of social insurance contributions (pension and death benefit funds) by entities affected by COVID-19 until the end of June or December 2020 without charging late payment interest, only applied for enterprises that operate in passenger transport, hospitality, food and drink, and other business lines affected by the pandemic and:
- Have to lay off employees, including at least 50% of the total number of employees who have social insurance.
- Or lose more than 50% of total assets
- The Enterprises remain to fully pay contributions to sickness, maternity, occupational accident, occupational disease, health insurance, unemployment insurance.
- It means that not all but only for enterprises that operate in some specific industries that directly affected by COVID-19 and shall prove for the damages and lost can be applied the policy of suspension of social insurance contributions
REGARDING PAYMENT OF WAGES AND BENEFITS FOR EMPLOYEES DURING WORK SUSPENSION DUE TO COVID-19 PANDEMIC
On March 25, 2020 the Ministry of Labor, War Invalids and Social Affairs issued official letter No 1064/LĐTBXH-QHLĐTL instructs enterprises who have to suspend their operation or scale down, suspend numerous employees from work due to Covid-19 pandemic
The suspension pay shall be agreed upon by both parties but must not be smaller than the region-based minimum wages, applied in cases that employees who are suspended due to direct impacts of Covid-19 pandemic such as:
1. Employees who are not allowed to return to work as requested by competent authorities
2. Employees who are suspended from work during quarantine as requested by competent authorities
3. Employees who are suspended from word because their employer is being quarantined or other employees in the same enterprise or department are being quarantined or not allowed to return to work
Enterprises that cannot provide adequate employment due to supply shortage or market reduction may temporarily reassign the employees against their employment contracts;
In case an employer is not able to pay the suspended employees due to prolonged work suspension, they may reach an agreement on suspension of the employment contracts.
Employers that have to scale down and have to dismiss employees, the employer shall pay job-loss allowances accordingly.
REGARDING DETAILED GUIDANCE ON SUSPENSION OF PAYING SOCIAL INSURANCE
Aimed at supporting enterprises badly affected by Covid-19 epidemic to create favorable conditions for quickly overcoming difficulties, Inter-sectoral social insurance agencies, Department of Labor, War Invalids and Social Affairs and Hanoi Department of Finance provided the guide on suspension of contributions to the retirement and survivorship fund for enterprises having difficulties due to the COVID-19 epidemic.
1. Subjects of application
Subjects of application are employers collectively referred to as enterprises that are facing difficulties caused by the COVID-19 epidemic, resulting in an inability to arrange jobs for workers. In particular, the number of employees participating in compulsory social insurance and taking temporary leave accounts for 50% or more of the total number of present employees before the suspension of production and business; or enterprises suffer losses of more than 50% of the total value of assets caused by the epidemic.
2. Duration of the policy application
Starting from the month that the enterprises propose and submit full documents to the social insurance agency until June 2020.
- In the case that by the end of June 2020, the Covid-19 epidemic has not been relieved, if it is needed and requested by enterprises, it may be considered and settled to suspend the payment to the retirement and survivorship fund until December 2020.
Required Procedures
Step 1: determine the number of employees participating in the social insurance who temporarily leaves their jobs or dossiers of the value of damaged properties .
- For enterprises with the number of employees participating in compulsory social insurance and taking temporary leave accounts for 50% or more of the total number of present employees before the suspension of production and business, shall compile a dossiers enclosed a list of employees at the time before suspending production and business and at the time of request; The list of employees participating social insurance must temporarily leave their jobs.
- For enterprises with enterprises suffer more than 50% of the total value of assets, shall compile a dossier enclosed with the latest minutes of inventory of duly before the time of being damaged; Minutes of inventory of damaged assets due to disease.
Within 15 working days after receiving the enterprise's request, the Department of Labor, War Invalids and Social Affairs, the Department of Finance will consider, identify and reply in written dossiers to the Enterprises.
Step 2: Apply for suspension of insurance payment
- Send a written dossiers request for temporary suspension of payment of insurance enclosed with a certificate of labor reduction or assets damaged to the Department of Labor, War Invalids and Social Affairs, Department of Finance.
- Within 05 working days from the receipt of the enterprise's application, the Social Insurance Agency is responsible for settling the suspension of retirement and survivorship fund contributions; In case of failure, the agency must reply in written dossiers and clearly state the reason.
Required Dossiers
- Official letter requesting for confirmation of eligibility for suspension of retirement and survivorship fund (form 01a, form 01.b).
- List of employees present and the list of employees who are participating social insurance and must temporarily take leave (form No. 02a).
- The latest inventory of assets reports before the time of being damaged (form No. 02.b).
- Minutes of inventory of damaged assets due to disease (Form No. 02.c)
- Relevant documents for comparison include: a copy of the enterprise registration certificate; originals (or copies) of papers related to the business suspension of production and business; timesheets, payroll at the time before suspending production and business and at the time of the written official request; papers related to employees temporarily resigning (agreement to postpone employment contract, agreement on unpaid leave, severance allowance ...).
The pandemic or any challenge too shall pass, taking advantage of the opportunity have to slow down to consolidate the internal resources is not only help businesses ready as soon as the business operations recover but also help create an advantage in the future.
In addition, VIVA experts are always ready to consult about your cases and situations with our real-time experiences and professional in business law – tax and accounting – labor and salary – corporate finance – office administration, etc. Free online and helpful solutions for entrepreneurs.
Please contact our experts for more information or directly contacting us about implementation of relevant procedures and conditions.
Hotline:
Email: support@vivabcs.com.vn
Call Center: 1800 1243
Wishing you always be safe and ready to comeback stronger after the pandemic.
VIVA BUSINESS CONSULTING SERVICES COMPANY | | | VIVA BUSINESS CONSULTING
is a professional consulting firm dedicated to create added value for clients by offering a wide range of business advisory and support services related to market entry and business operation in Vietnam.
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Email: support@vivabcs.com.vn | Tel: 028 7304 0455 – 18001243
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