Article 68 of the 2024 Law on Social Insurance stipulates that male workers with a social insurance contribution period of over 35 years and female workers with a social insurance contribution period of over 30 years, when retiring, in addition to pensions, are also entitled to a one-time allowance.
Regarding this regulation, in the latest draft revised Law on Social Insurance, the Ministry of Home Affairs proposes to amend and supplement Clause 2, Article 68 in the direction: for those who are eligible for early retirement due to reduced working capacity but choose to continue working, the level of one-time allowance when retiring is calculated at a level of 0.5 years or 2 years, depending on the time of reaching retirement age according to the provisions of law to the time of retirement corresponding to the case of retirement according to Article 64 or Article 65 of this Law.
According to the Ministry of Home Affairs, this regulation aims to facilitate the determination of the eligibility age for retirement for each case.
The draft also supplements regulations on rounding the time of social insurance participation with odd months in cases where employees have paid social insurance with odd months in both the periods before and after retirement. This regulation is similar to the regulation on rounding when resolving one-time social insurance in Clause 3, Article 70 and Clause 2, Article 102 of the Law.
Contributing opinions on this content, the Ministry of Finance proposed to amend Clause 2, Article 68 in the direction: in case employees have met the conditions to receive pensions according to Point a, Clause 1, Article 64 and Article 65 of the Law and continue to pay social insurance, the allowance level is equal to twice the average salary level used as the basis for social insurance contributions specified in Article 72 of the Law for each year of contribution higher than the number of years specified in Clause 1, Article 68, calculated from the time of reaching retirement age according to the provisions of law to the corresponding retirement time according to regulations.
According to the Ministry of Finance, current law allows people with 15 years of experience in heavy, hazardous, dangerous or especially heavy, hazardous, dangerous professions and jobs; people working in areas with regional allowances of 0.7 or areas with particularly difficult socio-economic conditions; or employees with conclusions of the Medical Assessment Council on impaired working capacity to retire early to protect the health of employees.
The Ministry of Finance also believes that the regulations in the draft may lead to workers continuing to work after meeting the conditions to receive a pension, even if only for one more month, to enjoy a more beneficial subsidy difference, which does not reflect the true nature of the policy.
To illustrate, the Ministry of Finance cited the case of female workers born on December 28, 1968, with a total social insurance contribution period of 40 years, including 34 years and 1 month of work in places with regional allowances from 0.7 or more and 4 years and 8 months of work in areas with particularly difficult socio-economic conditions.
According to the calculation method in the draft, the one-time pension when retiring is divided into two phases, including the time to the time of eligibility for pension and the time from the time of eligibility for pension onwards.
The total allowance in this case is 285,180,588 VND, while if applied according to the 2014 Law on Social Insurance, the allowance level is 90,533,520 VND.
Another example given by the Ministry of Finance is the case of a female worker born on February 25, 1972, with a total social insurance contribution period of 30 years and 5 months and retired early due to reduced working capacity according to the conclusion of the Medical Examination Council.
According to the calculation method in the draft, the total one-time allowance is 11,108,239 VND. Meanwhile, if applied according to the 2014 Law on Social Insurance, the allowance level is 2,221,648 VND.
The Ministry of Finance said that in this case, employees only pay social insurance for one more month after meeting the conditions to receive a pension due to reduced working capacity, the amount contributed to the social insurance fund is 3,985,080 VND, but the additional one-time allowance is 7,123,159 VND.
In addition, according to the Ministry of Finance, some other cases may also generate a profitable difference in the pension benefit rate after only one month of working due to regulations on reducing the pension benefit rate when retiring early.
In addition, the Ministry of Finance proposed to supplement the provisions in Clause 2, Article 68 in the direction: when calculating the benefit level, if both the period before and after reaching retirement age has odd months, the odd months of the previous period are transferred to the later period to calculate benefits.
According to the Ministry of Finance, this regulation aims to overcome the double rounding when calculating the benefit level and ensure the principle of only rounding once for the period with odd months.
Regarding these comments, the Ministry of Home Affairs said that it has received and supplemented regulations on calculating odd months in the draft Law.
Regarding the proposal not to apply the above regulations to retirees according to the provisions of the Law on Social Insurance, the Ministry of Home Affairs said it has not received it because it believes that this content affects the rights of employees and needs to continue to study and evaluate more carefully.
