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Vietnam Employment Law 2025 – No. 74/2025/QH15, passed by the National Assembly on June 16, 2025, and effective from January 1, 2026, replaces the 2013 Employment Law. This document introduces several key updates, particularly in unemployment insurance contribution rates. Notable Changes and Detailed Analysis:
1. New Unemployment Insurance Contribution Rates (Effective January 1, 2026):
Employees:
Under the 2025 Employment Law, employees contribute up to 1% of their monthly salary [6(1.1), 65a].
Analysis: This changes the previous fixed rate of 1% under the 2013 Law [7(1.1)] to a maximum limit, allowing flexibility. The actual rate may vary and be set lower depending on conditions, helping reduce the burden for employees while maintaining fund sustainability.
Employers:
Employers contribute up to 1% of the monthly salary fund of employees participating in unemployment insurance [6(1.2), 65b].
Analysis: Similarly, compared to the fixed 1% in the 2013 Law [7(1.2)], this upper limit enables potential reductions based on economic or social factors, encouraging job retention and lowering cost pressures for businesses.
State Support:
Both the 2025 and 2013 Laws provide for government support of up to 1% of the monthly salary fund for those participating in unemployment insurance [6(1.3), 7(1.3), 66c].
Analysis: The maximum rate remains unchanged, reflecting the government's stabilizing role while emphasizing shared responsibility from workers and employers.
2. Other Detailed Provisions Regarding Unemployment Insurance:
Contribution Timing:
Matches the mandatory social insurance payment period [9(3), 67].
Exemption Criteria:
Workers earning no salary for 14 or more working days in a month are exempt from paying that month’s contribution [9(4), 67].
Employer Responsibility:
Employers must fully pay unemployment insurance. Violations such as late or avoided payments are handled per the Social Insurance Law [9(5), 67].
Reduced Contribution for Disabled Employees:
Employers receive reduced contribution obligations when hiring people with disabilities within a 12-month period [9(6), 67].
Contract Termination Obligations:
Employers must fulfill all unemployment insurance payments upon contract termination. If unpaid, they must cover the amount the employee would have received [10(7), 68].
3. Structure and Scope of the 2025 Employment Law:
Includes provisions for job creation, labor registration, labor market information systems, vocational skill development, employment services, unemployment insurance, and state management. Unemployment insurance is defined as mandatory insurance organized by the state, offering support for job retention, training, job placement, and partial income compensation during unemployment [13(4)].
4. Other Major Employment Support Policies:
Policy Credit for Job Creation:
The government offers subsidized loans via the Social Policy Bank to support job creation and overseas work. Priority is given to disadvantaged groups.
Support for Rural Workforce:
Includes vocational training and loan assistance for employment transition.
Public Employment Programs:
Temporary paid jobs funded by state projects, with priority for ethnic minorities, the poor, elderly, and disabled [14(5), 30].
Youth and Elderly Employment Support:
Vocational training and startup loans for youth; skill enhancement for older workers.
Support for Overseas Workers:
Includes orientation, skills, languages, and cost subsidies for prioritized groups.
Labor Market Development Activities:
Government investment in labor databases and employment service capacity.
Labor Registration:
Designed to be simple, transparent, tech-friendly, and includes personal, employment, and social insurance data.
Vocational Skill Development:
Involves qualification frameworks, skill standards, training, and certification, especially for prioritized groups.
Employment Services:
Encompasses job counseling, labor supply, market data. E-commerce employment services require proper licensing.
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