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Responsibilities for finalizing social insurance records for employees.
Based on the provisions of Article 48 of the 2019 Labor Code, upon termination of an employment contract, the enterprise and the employee have the following respective responsibilities:
- Within 14 working days from the date of termination of the employment contract, both parties are responsible for fully settling all amounts related to each party's entitlements, except in the following cases where the period may be extended but not exceeding 30 days:
+ Businesses that are not individuals cease operations;
+ Businesses change their structure, technology, or for economic reasons;
+ Dividing, separating, merging, consolidating; selling, leasing, converting the type of business; transferring ownership and usage rights of assets of enterprises and cooperatives;
+ Due to natural disasters, fires, acts of war, or dangerous epidemics.
- Wages, social insurance, health insurance, unemployment insurance, severance pay, and other employee benefits as stipulated in collective bargaining agreements and employment contracts are given priority in payment in the event that a business or cooperative ceases operations, is dissolved, or goes bankrupt.
- Businesses have the following responsibilities:
+ Complete the procedures for confirming the period of social insurance and unemployment insurance contributions and return them along with other original documents if the company has retained them from the employee;
+ Provide copies of documents related to the employee's work process if the employee requests them. The cost of copying and sending the documents will be borne by the employer.
Therefore, based on the above regulations, upon termination of an employment contract, the enterprise is responsible for confirming the period of social insurance and unemployment insurance contributions (or, in practice, closing the social insurance account) for the employee.
Therefore, accountants and HR personnel in businesses need to be aware of this regulation in order to perform the necessary tasks to finalize social insurance records for employees whose employment contracts have been terminated.
Can employees finalize their social insurance records themselves?
According to Article 48 of the 2019 Labor Code, businesses are responsible for completing the procedures for confirming the period of social insurance and unemployment insurance contributions and returning them along with the original copies of other documents if the business has retained them from the employee.
In addition, Clause 5, Article 21 of the 2014 Social Insurance Law also stipulates that enterprises are responsible for coordinating with the social insurance agency to return social insurance books to employees and confirm the period of social insurance contributions when employees terminate their labor contracts, employment contracts, or resign in accordance with the law.
Thus, it can be seen that closing the social insurance account is the responsibility of the enterprise and is carried out in coordination with the social insurance agency.
Therefore, employees cannot finalize their social insurance records at the social insurance agency themselves after leaving their job, whether their resignation was legal or arbitrary. Instead, they must return to their former company to request that they complete the social insurance record finalization procedure.
Penalties for businesses that fail to finalize social insurance records for employees.
Based on the provisions of Article 12 of Decree 12/2022/ND-CP, enterprises that fail to complete the procedures for confirming the period of social insurance and unemployment insurance contributions for employees after the termination of their labor contracts as prescribed by law will be subject to the following penalties:
- From 2 million VND to 4 million VND for violations involving 1 to 10 employees;
- Fines ranging from 4 million VND to 10 million VND for violations involving 11 to 50 employees;
- From 10 million VND to 20 million VND for violations involving 51 to 100 employees;
- From 20 million VND to 30 million VND for violations involving 101 to 300 employees;
- Fines ranging from 30 million VND to 40 million VND for violations involving 301 or more employees.
In addition, businesses are also required to complete the procedures for verifying the period of social insurance and unemployment insurance contributions for their employees as stipulated by regulations.
What should employees do when their employer fails to finalize their social insurance records?
Based on the provisions of Article 18 of the 2014 Social Insurance Law, employees have the right to request competent agencies, organizations, and individuals to review decisions and actions of agencies, organizations, and individuals when there are grounds to believe that such decisions and actions violate the law on social insurance and infringe upon their legitimate rights and interests.
Therefore, if an employee has terminated their employment contract but the employer has not finalized their social insurance record as required, the employee should first contact the employer and request that they finalize their social insurance record.
If the business still fails to finalize the social insurance records as required, the employee can file a complaint with the Chief Inspector of the Department of Labor, War Invalids and Social Affairs where the business is located for resolution within their authority.
Procedures for closing social insurance accounts in 2023
According to Decision 595/QD-BHXH of 2017, employers must finalize social insurance records in the following order:
Step 1: Report workforce reduction
Before finalizing the social insurance record, the employer needs to complete the procedure for reporting a reduction in the number of employees.
- According to Article 23 of Decision 595/QD-BHXH, the labor reduction report dossier includes:
+ Declaration form for adjusting social insurance and health insurance information (Form TK1-TS)
+ Declaration form for adjusting social insurance and health insurance information (Form TK3-TS);
+ List of employees participating in social insurance, health insurance, accident insurance, occupational accident insurance, and occupational disease insurance (Form D02-TS);
+ Information summary sheet (Form D01-TS);
+ Valid health insurance card of the employee (01 copy/person);
- Employers submit the workforce reduction report directly to the social insurance agency where the employer is registered or send it by mail .
- After successfully reporting the reduction in social insurance contributions, you can proceed with closing your social insurance account.
Step 2: Finalize the social insurance record.
- According to Article 23 of Decision 595/QD-BHXH, the documents required for closing the social insurance account include:
+ Declaration form for participating units, adjustment of social insurance and health insurance information (Form TK3-TS);
+ List of employees participating in social insurance, health insurance, unemployment insurance, occupational accident insurance, and occupational disease insurance (Form D02-TS).
+ Information summary sheet (Form D01-TS).
+ Social insurance book
+ Social insurance slips.
+ Decision to terminate the employment contract (or other documents related to the termination of the employment contract).
+ Valid health insurance card of the employee (01 copy/person);
- Employers submit social insurance closing documents to the social insurance agency where the employer is registered or send them via mail.
Social insurance closing date
According to Clause 1, Article 48 of the 2019 Labor Code, within 14 working days from the date of termination of the labor contract, both parties are responsible for fully settling all amounts related to the rights and benefits of each party, except in the following cases where this period may be extended but not exceeding 30 days:
- The employer is not an individual ceasing operations;
- The employer changes its structure, technology, or for economic reasons;
- Dividing, separating, merging, consolidating; selling, leasing, converting the type of business; transferring ownership and usage rights of assets of enterprises and cooperatives;
- Due to natural disasters, fires, acts of war, or dangerous epidemics.
Therefore, according to regulations, the time for closing social insurance accounts will not exceed 14 days, and in special cases as stipulated in Clause 1, Article 48 of the 2019 Labor Code, the maximum time for closing social insurance accounts will not exceed 30 days.
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