Prime Minister Nguyen Tan Dung has decided that the government will propose the law-making National Assembly amend a new rule in the 2014 Law on Social Insurance in order to allow employees to take lump-sum social insurance payments when they leave a company, instead of waiting until they reach the age of retirement.
>> New social insurance rule sparks worker strike in Ho Chi Minh City
The decision was made at the government’s monthly meeting on Wednesday after Prime Minister Dung and his cabinet considered the proposals of ministries and other relevant agencies, following the strike of tens of thousands of workers at Pou Yuen Vietnam Co. Ltd., a Taiwanese-invested maker of sport shoes and garments for export in Binh Tan District, Ho Chi Minh City.
The strike, which has lasted for the past seven days, was triggered by the workers’ discontent with Article 60 of the 2014 Law on Social Insurance that will prevent them from getting lump-sum social insurance allowance payments when they quit their jobs.
Under the article, the scope of employees eligible to receive a lump-sum social insurance allowance when they resign from work is narrowed compared to the law currently in effect.
That means only a limited number of people are entitled to such lump-sum payment while the other resigned employees must wait until they reach their retirement age to get or receive such lump sums.
Pursuant to the current law, employees are allowed to take such lump sums when they stop working for a firm.
In Vietnam, the retirement age is 60 for men and 55 for women.
Deputy Minister of Labor, War Invalids, and Social Affairs Doan Mau Diep said Article 60 is aimed at encouraging employees to accumulate their periods of payment of social insurance so that they can receive pensions when they retire, instead of receiving lump-sum payments after each time they quit a job.
However, many Pou Yuen workers argued that they likely cannot continue to work until they retire.
If they quit their jobs in the near future they will have to wait for a long time to get such payment, the striking workers complained.
Most of the strikers said such lump sums help them pay for their daily needs when they already face financial difficulties while seeking new jobs after quitting the old ones.
Some other said they may quit their current job and start business on their own in the future, so they want to get such lump sums upon resignation as capital for their new career.
Most strikers requested that the law give them the right to decide on either taking a lump-sum social insurance allowance or accumulating their periods of payment of social insurance in order to receive a pension when they retire.
After listening to these opinions and aspirations, the Ho Chi Minh City People’s Committee, the Ministry of Labor, War Invalids, and Social Affairs, and the Vietnam General Confederation of Labor, have submitted them to the central government for consideration.
At a press briefing after the government’s meeting, Nguyen Van Nen, Minister-Chairman of the Government Office, told Tuoi Tre (Youth) newspaper that the government considers Pou Yuen workers’ request legitimate.
Therefore, the government will ask the National Assembly to revise Article 60 to allow employees to either take lump-sum social insurance allowances upon resignation or accumulating their periods of payment of social insurance so as to receive a pension, Minister Nen said.
“From now until December 31, 2015, no changes will be made to all regulations related to social insurance payment. On May 20, the government will convene a meeting and make a proposal to the National Assembly regarding this matter,” he said.
“We find that the government’s move, which is based on workers’ legitimate request, is reasonable and suitable for current conditions. On this basis, we call on all striking workers to set their mind at rest and resume work.
“Workers should be calm and should not follow any provocation or instigation of anyone to do anything that goes against their legitimate interests,” the minister said.
Lao Dong (Labor) newspaper cited a source from Pou Yuen workers as saying that striking workers have resumed work since this morning, April 2, a week after the strike broke out on March 26.
Bich Thao, who has worked for Pou Yuen for three years, was quoted by Lao Dong as saying that all workers were very happy to know, through the company’s loudspeaker, that the government has agreed to propose amending Article 60 so that they can take lump-sum social insurance allowance payments.
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