Social Insurance for Foreign Employees in Vietnam: 2026 Employer Guide

Updated: October 29, 2026

Hiring foreign professionals can help businesses in Vietnam access international expertise and strengthen their management capabilities. However, employing foreign nationals also creates responsibilities involving employment contracts, payroll, compulsory insurance and regulatory compliance.

One area that requires particular attention is social insurance for foreign employees. Businesses need to determine which workers must participate, whether an exemption applies, how contributions are calculated and how insurance costs should be reflected in monthly payroll.

For foreign-invested enterprises (FIEs), managing social insurance for foreign employees can become more complex when employment arrangements involve overseas parent companies, foreign-currency salaries or temporary assignments to Vietnam.

This guide explains the compulsory insurance rules applicable to foreign workers in Vietnam in 2026, including contribution rates, exemptions, salary calculations, registration responsibilities and practical considerations for employers.

1. What Are the Social Insurance Rules for Foreign Employees in Vietnam in 2026?

The principal legal framework is Law No. 41/2024/QH15 on Social Insurance (Luật Bảo hiểm xã hội số 41/2024/QH15), effective from July 1, 2025, as subsequently amended.

The Government also issued Decree No. 158/2025/ND-CP detailing and guiding the implementation of certain provisions of the Law on Social Insurance concerning compulsory social insurance (Nghị định số 158/2025/NĐ-CP quy định chi tiết và hướng dẫn thi hành một số điều của Luật Bảo hiểm xã hội về bảo hiểm xã hội bắt buộc).

Decree 158 took effect on July 1, 2025, and provides detailed guidance on matters including participation, contribution salary and registration procedures.

For foreign-invested companies, the most important starting point is Clause 2, Article 2 of the Law on Social Insurance.

Under this provision, foreign citizens working in Vietnam are generally subject to compulsory social insurance when they work under definite-term employment contracts of at least 12 months with employers in Vietnam, unless a specified exception applies.

When reviewing social insurance for foreign employees, businesses should also consider the applicable employment, health insurance and foreign-worker regulations.

Official references:

• Law No. 41/2024/QH15 on Social Insurance – Government Portal
• Decree No. 158/2025/ND-CP – Government Portal

2. Which Foreign Employees Must Participate in Compulsory Social Insurance?

Under Clause 2, Article 2 of the Law on Social Insurance, the general participation requirement concerns foreign employees working in Vietnam under a definite-term employment contract lasting at least 12 months with a Vietnam-based employer.

When determining social insurance for foreign employees, employers should review the actual employment arrangement rather than rely solely on nationality or job title.

For example, a foreign finance manager recruited by a Vietnamese subsidiary under a 24-month employment contract would generally fall within the relevant participation category, provided no statutory exception applies.

By contrast, a foreign specialist working under an intra-corporate transfer arrangement may require a different assessment.

2.1. Intra-Corporate Transferees

Point a, Clause 2, Article 2 excludes foreign employees transferred within an enterprise in accordance with Vietnamese regulations on foreign workers.

However, the term intra-corporate transfer has a specific legal meaning. A business should not automatically treat every employee assigned by an overseas parent company as exempt.

The employer needs to examine the transfer arrangement, the employee’s employment relationship, the position held and the supporting documentation under the foreign-worker regulations applicable at the relevant time.

2.2. Employees Who Have Reached Retirement Age

Point b, Clause 2, Article 2 also provides an exception for foreign employees who have reached the retirement age under Clause 2, Article 169 of the Labor Code at the time their employment contract is concluded.

The applicable retirement age should be determined under the relevant legal schedule and the employee’s circumstances.

2.3. International Treaty Exceptions

Point c, Clause 2, Article 2 recognizes exceptions where an international treaty to which Vietnam is a party provides otherwise.

Companies employing internationally mobile workers should therefore assess whether an applicable agreement affects their social insurance obligations.

An employee’s foreign nationality alone is not sufficient evidence that a treaty exemption applies.

3. Social Insurance Contribution Rates for Foreign Employees in 2026

For foreign employees who are subject to the relevant compulsory insurance requirements, payroll teams need to distinguish the employee’s contribution from the employer’s contribution.

Articles 33 and 34 of the Law on Social Insurance establish the principal compulsory social insurance contribution rates. Additional requirements apply to health insurance and occupational accident and disease insurance.

Vietnam Social Security has published the following general contribution structure for covered foreign employees.

Contribution category	Employee	Employer
Retirement and survivorship fund	8%	14%
Sickness and maternity fund	—	3%
Work injury and occupational disease insurance	—	Generally 0.5%
Health insurance	1.5%	3%
General total	9.5%	20.5%

The table presents general contribution rates for a covered foreign employee. A reduced occupational accident and disease rate may apply to qualifying employers. Contribution ceilings, the relevant salary basis and other applicable conditions must also be considered.

Accurate administration of social insurance for foreign employees requires a clear distinction between employer and employee contributions.

The employee’s contribution is generally deducted from the relevant payroll amount, while the employer’s contribution represents an additional employment cost.

Example: Assume a covered foreign employee has a monthly salary of VND 30 million that is fully used as the applicable contribution basis and falls within the relevant ceilings.

The employee contribution at 9.5% would be VND 2.85 million. The employer contribution at 20.5% would be VND 6.15 million.

These are illustrative calculations and do not represent a complete payslip. Personal income tax, contractual benefits and any separate amounts payable under employment law have not been included.

For the official explanation of rates, see Vietnam Social Security’s guidance on foreign-employee insurance contributions.

4. How Is the Salary Used for Social Insurance Calculated?

A common mistake when calculating social insurance for foreign employees is assuming that every payment automatically forms part of the contribution salary.

Under Point b, Clause 1, Article 31 of the Law on Social Insurance and Article 7 of Decree No. 158/2025/ND-CP, the contribution salary under an employer-determined salary regime generally includes the salary for the job or position, relevant salary allowances and qualifying additional payments.

Additional amounts that are specifically identified and paid regularly and consistently may form part of the contribution basis.

By contrast, payments that depend on or fluctuate according to productivity, work performance or the quality of completed work are treated differently under the conditions specified by Article 7.

The payroll team should therefore assess the legal nature of each payment rather than rely solely on its label.

For instance, an allowance described as a benefit may still require consideration if it is a fixed contractual amount paid regularly. Conversely, a performance-based payment may be treated differently if it genuinely varies according to measurable results.

The contribution salary is also subject to statutory limits. Companies should determine the applicable minimum and maximum for the relevant contribution period before finalizing payroll.

4.1. What if the Employee Is Paid in a Foreign Currency?

This issue is particularly relevant to foreign-invested companies.

Under Clause 5, Article 7 of Decree No. 158/2025/ND-CP, where both the contractual salary and the salary paid are denominated in a foreign currency, the salary used for compulsory social insurance is converted into Vietnamese dong using the prescribed average transfer-buying exchange rate announced by four state-owned commercial banks.

The relevant exchange rate is determined at the end of January 2 for the first six months of the year and July 1 for the second six months. If the specified date is a holiday or non-working day, the immediately following working day is used.

This calculation should not be confused with exchange rates used for every other accounting or payroll purpose.

Vietnam Social Security explained these rules in its August 14, 2026 guidance on contribution salaries for foreign workers.

5. Do Foreign Employees Have to Pay Unemployment Insurance?

Foreign employees are not within the compulsory unemployment insurance participation category under Article 31 of Law No. 74/2025/QH15 on Employment (Luật Việc làm số 74/2025/QH15), which took effect on January 1, 2026.

However, this does not mean the employer can ignore the unemployment insurance component when reviewing payroll-related obligations.

In an official response dated October 13, 2026, the Ministry of Home Affairs clarified that foreign employees who are subject to compulsory social insurance but not unemployment insurance are entitled to receive an additional amount from their employers, paid together with their salaries, equivalent to the employer’s unemployment insurance contribution rate.

The ministry identified this amount as 1% of the employee’s monthly salary, referring to Clause 3, Article 168 of the Labor Code and the relevant unemployment insurance rules.

This payment is distinct from the insurance contributions remitted to the compulsory insurance funds.

Therefore, businesses should review not only the social and health insurance deductions, but also whether the required additional wage payment has been handled correctly.

For foreign workers who are not subject to compulsory social insurance, the applicable additional payment obligations may differ depending on which insurance categories they are excluded from.

See the Ministry of Home Affairs’ October 2026 explanation on payments in lieu of unemployment insurance.

6. Registration and Payroll Responsibilities of Employers

Companies managing social insurance for foreign employees should establish an onboarding process connecting human resources, payroll and accounting teams.

The dossier requirements are addressed in Article 27 and include the relevant employer registration information, employee list and employee declaration.

In practice, a company hiring foreign employees should establish an onboarding process connecting the human resources, payroll and accounting functions.

The process should determine whether the employee falls within the compulsory insurance category, whether an exclusion applies, which salary components form the contribution basis and whether the required documents have been prepared.

Once the employee is registered, the payroll team should monitor changes in contractual salary, allowances, employment status and other information that may affect contributions.

A company should not assume that registration is complete simply because the foreign employee holds a valid work permit.

Work authorization and compulsory insurance participation are related compliance matters, but they must be assessed under their respective legal rules.

7. A Practical Payroll Compliance Checklist for Foreign Employees

The following checklist can help employers assess whether their payroll processes are appropriately organized.

Review area	What the company should verify
Employment contract	Is the contract duration at least 12 months?
Exemptions	Does a legally recognized intra-corporate transfer, retirement-age or treaty exception apply?
Contribution rates	Are employee and employer contributions calculated separately?
Salary basis	Are fixed contractual payments and qualifying allowances correctly classified?
Foreign-currency salary	Has the prescribed exchange rate been used?
Registration	Was the required dossier submitted within the applicable deadline?
Unemployment insurance treatment	Has the additional wage payment requirement been assessed?
Recordkeeping	Can the company support its calculations with contracts and payroll records?

This is a practical management checklist prepared for employers. It is not an official mandatory form issued by the Vietnamese authorities.

For larger organizations, the review may also need to consider employees who transfer between group entities, change contract arrangements or receive compensation partly in Vietnam and partly overseas.

8. Upcoming Foreign-Worker Regulation: What Should Employers Watch?

On October 20, 2026, the Government issued Decree No. 393/2026/ND-CP on Foreign Workers Working in Vietnam (Nghị định số 393/2026/NĐ-CP quy định về người lao động nước ngoài làm việc tại Việt Nam).

According to the Government’s official publication, the decree is scheduled to take effect on December 5, 2026.

As of this article’s update date, October 29, 2026, that effective date has not yet arrived.

The decree addresses foreign-worker matters, including work permits and exemptions. Employers should review its provisions when preparing future recruitment and transfer arrangements.

However, businesses should not apply its procedures prematurely or assume that the new decree automatically changes compulsory social insurance contribution rates.

For the official publication, see Decree No. 393/2026/ND-CP – Government Legal Documents Portal.

9. Frequently Asked Questions About Social Insurance for Foreign Employees

Are all foreign employees in Vietnam required to pay social insurance?

No. Participation depends on the employment arrangement and the legal conditions in Clause 2, Article 2 of the Law on Social Insurance. The general requirement involves a definite-term employment contract of at least 12 months with a Vietnam-based employer, subject to specified exceptions.

Are intra-corporate transferees automatically exempt?

Not automatically. The individual must qualify as an intra-corporate transferee under the relevant Vietnamese foreign-worker regulations. The employer should retain appropriate supporting documentation.

How much does a foreign employee contribute?

For a covered foreign employee, the general employee contribution is 8% to compulsory social insurance and 1.5% to health insurance, calculated using the applicable contribution basis.

How much does the employer contribute?

The general employer contribution is 20.5%, including compulsory social insurance, occupational accident and disease insurance, and health insurance. Special rates and contribution limits may affect particular cases.

Do foreign workers participate in unemployment insurance?

Foreign workers are outside the compulsory unemployment insurance participation category under the current Employment Law. Employers should nevertheless assess the separate additional wage payment clarified by the Ministry of Home Affairs in October 2026.

Does a work permit automatically determine social insurance participation?

No. Work permits and compulsory insurance are governed by different legal requirements. Employment contracts, statutory exceptions and the employee’s actual circumstances must also be assessed.

10. How PHAM CONSULT Supports Payroll and Social Insurance Compliance

Managing international payroll in Vietnam involves more than calculating gross and net salaries.

For FDI companies, managing social insurance for foreign employees requires coordination between employment documentation, payroll calculations and compliance reporting.

PHAM & ASSOCIATES CONSULTING COMPANY LIMITED (PHAM CONSULT) provides payroll-related advisory and administrative services for businesses operating in Vietnam.

Depending on the scope of engagement, PHAM CONSULT supports payroll processing, employment documentation, social insurance procedures and related compliance matters.

Businesses can explore PHAM CONSULT’s Payroll Service and Social Insurance Procedure Services.

For assistance reviewing insurance eligibility, contribution calculations or payroll procedures for foreign employees, please contact PHAM CONSULT.

PHAM CONSULT

Website: https://phamconsult.com/

Email: info@phamconsult.com

Ho Chi Minh City Office: +84 28 3930 2487

Disclaimer: This article provides general information as of October 29, 2026. The applicable obligations depend on the employee’s contract, employment arrangement, salary structure, relevant international agreements and legislation in force at the time. Businesses should seek case-specific professional advice before making payroll or insurance decisions.