Close the social insurance book when the company is dissolved

In Vietnam, social insurance is a crucial component of an employee's financial security. But what happens when a company owes an employee a month's worth of social insurance contributions after unilateral termination of the contract? Can the company close the social insurance book before settling the debt? This article will delve into the intricacies of this issue and provide clarity on the legal aspects involved. So, What does it mean to close the social insurance book when the company is dissolved? ACC Group will address your question. 

1. How is the social insurance book closed when the company is dissolved?

Closing a social insurance book, often referred to as a social security or social insurance account, when a company is dissolved typically involves several steps to ensure that employees' social insurance contributions are properly settled. The exact procedures may vary depending on the country and the local regulations governing social insurance.

2. Understanding the Regulations

To address this question, we need to refer to the legal framework governing social insurance in Vietnam. According to Clause 72, Article 1 of Decision 505/QD-BHXH in 2020, specific regulations pertain to the representation and confirmation of the Social Insurance (SI) contribution period in an SI booklet.

When a unit is in arrears on insurance contributions and an employee is eligible for SI benefits or terminates their labor or employment contract, the unit must pay insurance contributions in full, including late payment interest. This is in accordance with regulations, and the social security agency will confirm the employee's SI booklet. This confirmation is essential for the prompt payment of SI and Unemployment Insurance (UI) benefits.

3. The Role of the Law on Social Insurance

Clause 5, Article 21 of the Law on Social Insurance 2014 complements the process. It specifies that the social insurance agencies should coordinate in returning social insurance books to employees who terminate labor contracts or working contracts according to the law.

Hence, in this case, the company can close the social insurance books for employees only after settling the outstanding payment. Once the unit has successfully recovered the insurance contributions in arrears, an additional confirmation will be provided on the employee's SI booklet in Vietnam.

4. Ensuring Convenience

For the sake of convenience and to ensure a smooth process, it is advisable for the enterprise to clear the unpaid amount of social insurance with the employee before proceeding to close the social insurance book. This proactive approach not only complies with the law but also ensures a streamlined procedure for both parties involved.

In summary, a company in Vietnam can close the social insurance book for an employee after paying the full amount owed. The legal framework supports this approach, ensuring that employees receive the benefits they are entitled to.

5. Conclusion

In Vietnam, adhering to the regulations governing social insurance is crucial for both companies and employees. Closing social insurance books after clearing outstanding payments is a legal requirement, ensuring that employees receive their entitled benefits promptly. It's essential for businesses to fulfill their obligations, and employees should be aware of their rights to ensure a smooth process.

FAQs

1. What if a company doesn't close the social insurance book for maternity benefits in Vietnam?

If a company delays closing the insurance book for maternity benefits, employees can follow the legal provisions in the Law on Social Insurance 2014. They should contact the company to request timely closure and return of the insurance book as required by law. If the issue remains unresolved, they can file a complaint with the Chief Inspector of the Department of Labor, War Invalids, and Social Affairs to protect their rights and interests.

2. Can I close my social insurance book in Vietnam if I haven't received a termination decision from the company?

If you have unilaterally terminated your contract and don't have a termination decision from the company, you cannot close your social insurance book yourself. The responsibility for closing the social insurance book lies with the employer. You should contact your previous company to initiate the closure procedure.

3. What documents are needed to close the social insurance book in Vietnam?

The procedure for closing the social insurance book typically involves the company reporting the reduction of labor, preparing documents such as a list of employees participating in social insurance (Form D02 - TS) and an information list (Form D01 - TS). After the company successfully reports the reduction of labor and fulfills its obligations of paying insurance premiums, the closure process can be initiated, and the book can be returned to the employee.

4. How long does it take to close the social insurance book in Vietnam?

The duration of closing the social insurance book in Vietnam may vary, but it should be completed within a reasonable time frame. The company should settle all payments related to social insurance, health insurance, and unemployment insurance premiums within 14 working days following the termination of the employment contract. In specific cases, this period may be extended but should not exceed 30 days.