Social security in Vietnam is a comprehensive system designed to provide financial support and protection to individuals and families against life’s uncertainties, such as illness, unemployment, and old age. Managed by the Vietnam Social Security (VSS), this system encompasses various types of compulsory and voluntary insurance programs, including social insurance, health insurance, and unemployment insurance. These programs are crucial for promoting social equity and stability, as they help mitigate the financial risks associated with health and employment-related issues.
Social insurance is the backbone of Vietnam’s social security system, covering a range of benefits such as retirement pensions, sickness, maternity, and work-related injuries. Both employers and employees contribute to the social insurance fund, ensuring that workers are supported during periods of incapacity or after retirement. Health insurance is another vital component, providing access to healthcare services at reduced costs for individuals and families. Additionally, unemployment insurance offers financial assistance to those who have lost their jobs, helping them maintain a basic standard of living while they seek new employment opportunities.
As Vietnam’s economy and workforce continue to grow and evolve, the government is focused on strengthening and expanding the social security system. Efforts are being made to increase coverage, particularly in the informal sector, and to improve the quality and accessibility of services. These reforms aim to create a more inclusive and robust social security network, ensuring that all citizens can enjoy a safer and more secure future.
Components of Social Security
Social Insurance
- Coverage: Provides benefits for retirement pensions, sickness, maternity, and occupational hazards, ensuring financial support during various life stages and circumstances.
- Contribution Structure: Funded by contributions from both employers and employees. Employers typically contribute a larger percentage, while employees contribute a smaller portion of their monthly salary.
- Benefits and Eligibility Criteria: Eligibility depends on meeting specific contribution periods and conditions. Benefits include monthly pensions, medical leave compensation, and financial support for workplace accidents or occupational diseases.
Health Insurance
- Purpose: Aims to ensure equitable access to essential healthcare services at reduced costs, contributing to improved public health and well-being.
- Scope of Coverage: Includes outpatient and inpatient care, chronic disease management, maternity services, and preventive healthcare measures like vaccinations and regular check-ups.
- Contribution and Subsidy Structure: Contributions are shared between employers and employees, with government subsidies provided for vulnerable groups such as children, the elderly, and low-income households to ensure broader coverage.
Unemployment Insurance
- Support for Unemployed Individuals: Provides financial assistance to workers who have lost their jobs, helping them maintain a basic standard of living during their transition to new employment.
- Eligibility and Duration of Benefits: Benefits are available to those who meet specific contribution requirements and have registered with employment services. The duration of benefits varies based on the length of prior contributions.
- Role in Workforce Stability: Helps stabilise the workforce by providing income support and job-seeking assistance, contributing to economic resilience and social stability.
Legal Framework and Regulations
Key Laws Governing Social Security: The main legal documents include the Law on Social Insurance, the Law on Health Insurance, and various decrees that provide detailed guidelines on implementation and management.
Contribution Rates, Benefit Calculations, and Administrative Processes: The laws outline the specific contribution rates for different types of insurance, methods for calculating benefits, and procedures for claims and fund management. These regulations ensure transparency and consistency in the administration of social security.
Recent Amendments and Reforms: Updates to the legal framework aim to expand coverage, improve benefit adequacy, and enhance the efficiency of service delivery. Recent changes include adjustments to retirement ages, benefit levels, and expanded coverage for informal sector workers and rural populations.
Social security for workers in Vietnam
The law outlines a number of key obligations of employers and employees regarding contributions and the rights of workers to access benefits. In particular, employers are required to register their employees for social insurance and make regular contributions on behalf of their workforce. Failure to comply with these obligations can result in penalties and legal consequences.
Compulsory social security contributions
| Local Employee | Foreign Employee | |||
| Type | Employer | Employee | Employer | Employee |
| Retirement | 14.00% | 8.00% | 14.00% | 8.00% |
| Sick/Maternity | 3.00% | 0.00% | 3.00% | 0.00% |
| Occupational | 0.50% | 0.00% | 0.50% | 0.00% |
| Health Insurance | 3.00% | 1.50% | 3.00% | 1.50% |
| Unemployment Insurance | 1.00% | 1.00% | 0.00% | 0.00% |
| Total | 21.50% | 10.50% | 20.50% | 9.50% |
Recent Reforms and Initiatives
Recent reforms in Vietnam’s social security system include significant updates outlined in the Law on Social Insurance 2024, effective from July 1, 2025. One of the key changes is the reduction of the minimum contribution period required for voluntary social insurance participants to qualify for a retirement pension, lowered from 20 years to 15 years. This amendment aims to make retirement benefits more accessible to a broader segment of the population, particularly those in informal employment or with irregular work histories.
Additionally, there have been adjustments to the social insurance contribution rates following an increase in the base salary to 1,800,000 VND per month, effective from July 1, 2023. The new rates apply to both employers and employees, affecting the retirement and survivorship allowance funds, as well as the occupational accident and disease fund. These changes are part of broader efforts to ensure the financial stability of social security funds while expanding coverage and benefits.
What’s next?
Social security in Vietnam is a comprehensive system designed to provide financial support and protection to individuals and families against life’s uncertainties, such as illness, unemployment, and old age.
There is, however, still room to improve and strengthen the current social security apparatus in Vietnam and updates are incrementally being made. With this in mind, foreign firms doing business in Vietnam should make sure to keep up with the latest developments by subscribing to the-shiv.