Updates on superannuation and health care contributions – the private sector

By Quan Nguyen

From 1st January 2016, these new rules on compulsory superannuation and health care contributions apply to private sector employers and employees:
For employers, contributions are:
1. Superannuation = 14% base salary
2. Health care = 3% base salary
3. Work safe = 1% base salary
4. Parenting benefits = 3% base salary
For employees, contributions are:
1. Superannuation = 8% base salary
2. Health care = 1.5% base salary
The government decrees on base salary in according to regions. If contract salary is higher than base salary, then the base salary is replaced by the contract salary.
For skilled workers, then contributions are calculated on base salary plus 7%.
For hazardous working environment, then contributions are calculated on base salary plus 5%.
The contribution rates are quite high if compared with other countries, but the government seems determined to bring the superannuation and health care system to the mass of the workforce. News headlines suggest that the Social Security Department may increase inspections and penalties for non-compliance with the rules.
References:
1. Law on Social Security 2014 (Law No.58/2014/QH13)
2. Decision 959/QD-BHXH dated 09/09/2015

Posted in: News & Events

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