VI Where should a director who is also an employee elsewhere contribute to social insurance? What are the latest regulations of the 2025 Social Insurance Law on social insurance contributions for company directors? Let’s explore this further with Pham Consult!
Does a director working for multiple companies have to contribute to social insurance in multiple places?
According to Clause 24, Article 4 of the 2020 Enterprise Law, the following definitions apply:
Definition of Terms
In this Law, the following terms are understood as follows:
- Enterprise manager is a manager of a private enterprise and a company manager, including the owner of a private enterprise, a general partner, the Chairman of the Board of Members, a member of the Board of Members, the Chairman of the company, the Chairman of the Board of Directors, a member of the Board of Directors, the Director or General Director, and individuals holding other management positions as stipulated in the company’s charter.
- Enterprise founder is an individual or organization thatestablishesor contributes capital to establish an enterprise.
- Foreign investor is an individual or organization as defined by the Investment Law.
- Capital contribution is the total value of assets that a member has contributed or committed to contribute to a limited liability company or a partnership. The capital contribution ratio is the ratio between a member’s capital contribution and the charter capital of a limited liability company or partnership.
Accordingly, the company director is the business manager.
According to point a, n, clause 1, Article 2 of the Social Insurance Law 2024, the following is stipulated:
Subjects of compulsory and voluntary social insurance participation
- Vietnamese citizens who are employees subject to compulsory social insurance participation include:
- a) Employees working under indefinite-term labor contracts, or fixed-term labor contracts with a term of at least one month, including cases where the employee and employer agree on a differentname but the content reflects paid work, wages, and management, direction, and supervision by one party;
- b) Business managers, auditors, representatives of state capital, representatives of enterprise capitalas prescribed by law; members of the Board of Directors, General Director, Director, members of the Supervisory Board or auditors and other elected
management positions of cooperatives and cooperative unions as prescribed by the Law on Cooperatives do not receive salaries.
Thus, business managers who do not receive a salary are required to participate in compulsory social insurance according to point n, clause 1, Article 2 of the 2024 Social Insurance Law. Employees with labor contracts of one month or more are required to participate in compulsory social insurance according to point a, clause 1, Article 2 of the 2024 Social Insurance Law.
According to point b, clause 3, Article 3 of Decree 158/2025/ND-CP:
Subjects required to participate in compulsory social insurance
- For subjects specified in clause 2 of this Article and point n, clause 1, Article 2 of the Social Insurance Law, and simultaneously belonging to multiple subjects specified in clause 1, Article 2 of the Social Insurance Law, participation in compulsory social insurance shall be implemented as follows:
- b) Subjects specified in point n, clause 1, Article 2 of the Social Insurance Law who simultaneously belong to one of the subjects specified in points b, c, d, e,i, a, l And according to Clause 1, Article 2 of the Social Insurance Law, participation in compulsory social insurance is mandatory for the corresponding subjects specified in points b, c, d, e, i, a, l or k of Clause 1, Article 2 of the Social Insurance Law in the order they come first.
Accordingly, a business manager who does not receive a salary and also has an employment contract of one month or more elsewhere must participate in compulsory social insurance under the category of employees with employment contracts of one month or more elsewhere, not under the category of business managers at the company where they are the director.
What is the basis for social insurance contributions for those with employment contracts?
According to point b, clause 1, Article 31 of the Social Insurance Law 2024, for employees subject to the salary regime determined by the employer, the salary used as the basis for compulsory social insurance contributions is the monthly salary, including the salary based on the job or position, salary allowances, and other supplementary payments agreed upon and paid regularly and stably in each pay period.
In cases where an employee ceases work but continues to receive a monthly salary equal to or higher than the lowest mandatory social insurance contribution base salary, contributions will be based on the salary received during the period of cessation of work.
What are the social insurance contribution rates for employees with labor contracts?
According to Clause 1, Article 32 of the 2024 Social Insurance Law, the mandatory social insurance contribution rates include:
– 3% of the salary used as the basis for social insurance contributions to the sickness and maternity fund;
– 22% of the salary used as the basis for social insurance contributions to the retirement and death benefit fund.
