The proposal to increase the base salary to 1.8 million VND/month from July 1, 2023 is the joy of thousands of employees at businesses today. However, the base salary is the salary used as the basis for calculating the payment rate as well as the enjoyment level of many social insurance regimes (social insurance). Therefore, the above proposal will lead to changes in: social insurance premiums, pension benefits increasing according to the base salary, social insurance allowances.
1. The maximum level of social insurance premium payment is from 1/7/2023
From July 1, 2023, the base salary is expected to be 1.8 million VND/month (previously 1.49 million VND/month), according to which the maximum voluntary social insurance contribution rate in 2023 is 22% of 20 times the base salary and is divided into 2 periods as follows::
The maximum voluntary social insurance premium until June 30, 2023 is:
22% x (20 x 1,490,000) = 6,556,000 VND/month.
The maximum voluntary social insurance premium from July 1, 2023 is:
22% x (20 x 1,800,000) = 7,920,000 VND/month.
Thus, the social insurance premium rate in 2023 has two notable points compared to 2022. One is to increase the maximum voluntary social insurance contribution for participants of voluntary social insurance due to the increase in the base salary. Second, in 2023, the employer must contribute to the UI fund with a contribution of 1% and no longer support the 0% contribution rate due to the Covid epidemic like in 2022.
2. The pension rate increases according to the base salary
According to the Law on Social Insurance (Social Insurance) 2014, the pension rate of employees with a period of participation in social insurance will be calculated based on the time of payment of social insurance and the average salary/monthly income paid. Social insurance. However, Article 56 and Article 71 of the Law on Social Insurance 2014 stipulate that the lowest pension when participating in compulsory social insurance is equal to the base salary. Therefore, when the basic salary increases, the lowest pension rate calculated for employees participating in compulsory social insurance to retire in 2023 will also increase. At this time, the minimum pension will increase from 1.49 million VND/month to 1.8 million VND/month.
3. Social insurance allowance level
According to the 2014 Law on Social Insurance, many social insurance allowances are calculated based on the base salary. Therefore, when the base salary increases, the allowance for sickness, maternity, occupational accident, occupational disease, and survivorship allowance is also adjusted. Specifically:
– The level of convalescence allowance after sickness: The level of enjoyment of the convalescence and health rehabilitation regime after illness is calculated according to the following formula: if the base salary increases from 1.49 million VND/month to 1.8 million VND/month, the allowance will increase from VND 447,000/day to VND 540,000/day.
– One-time allowance when giving birth: Female employees who give birth or adopt children under 6 months old are paid a lump-sum allowance by the social insurance agency. When the base salary in 2023 increases, the employee’s one-time allowance when giving birth or adopting a child is also adjusted to increase from 2.98 million VND/child to 3.6 million VND/child.
– The level of convalescence after maternity: The allowance for convalescence and health rehabilitation after illness increases from 447,000 VND/day to 540,000 VND/day.
– One-time allowance in case of occupational accident or disease: An employee whose working capacity is reduced from 5% to 30% due to a labor accident or occupational disease shall be entitled to a one-time allowance. Part of this allowance will be calculated according to the degree of working capacity decrease and the base salary at the time of payment. If the base salary increases, the one-time allowance calculated according to the level of labor reduction will also increase. Accordingly, for a 5% decrease in working capacity, the allowance will be increased from VND 7.45 million to VND 9 million. After that, for every 1% decrease, you will be entitled to an additional 900,000 VND (currently 745,000 VND).
– Monthly allowance in case of occupational accident or disease: Employees with a working capacity decrease of 31% or more due to occupational accidents or diseases are entitled to a monthly allowance. Part of this allowance will be calculated according to the degree of working capacity decrease and the base salary at the time of payment. When the base salary increases, the monthly allowance calculated according to the level of labor reduction will also increase. Employees with a 31% decrease in working capacity receive an increase from 447,000 VND/month to 540,000 VND/month. After that, for every 1% decrease, you will be entitled to an additional 36,000 VND/month (currently 29,800 VND/month).
– Allowances for service to people suffering from occupational accidents and diseases: Employees with a working capacity decrease of 81% or more will be entitled to a monthly service allowance if they have one of the following additional conditions: paralyzed Spine; binocular blindness; amputation, paralysis of both legs; mentally ill. When the base salary increases, the service allowance will increase from 1.49 million VND/month to 1.8 million VND/month.
– One-time allowance when dying due to a labor accident or occupational disease: When an employee dies due to a labor accident or occupational disease, their relatives will be paid a one-time allowance. When the base salary increases, this allowance also increases from VND 53.64 million to VND 64.8 million.
– Increase the level of convalescence after treatment: Employees who return to work after stabilizing their injuries due to occupational accidents or diseases due to occupational diseases, but within the first 30 days of their health have not recovered, are entitled to a leave of absence. health and recovery. When the base salary increases, the allowance for convalescence and health rehabilitation after injury and illness treatment increases from VND 447,000/day to VND 540,000/day.
– Funeral allowance level: The following employees die, their relatives will receive funeral allowance: the person participating in social insurance; the person who is reserving the process of paying social insurance premiums; pensioners; people who are receiving monthly labor accident and occupational disease allowance; Employees die due to occupational accidents or occupational diseases. As the base salary increases, the funeral allowance also increases from VND 14.9 million to VND 18 million.
– Monthly survivorship allowance: When the base salary increases, the monthly survivorship allowance also increases. Specifically: family members who have no direct caregivers receive a monthly survivorship allowance from VND 1,043 million/month to VND 1.26 million/month; In the remaining cases, the monthly survivorship allowance will be increased from 745,000 VND/month to 900,000 VND/month.
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