Why do foreigners not participate in unemployment insurance?

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Unemployment insurance in Vietnam is not required for foreigners working under labor contracts. Vietnamese citizens are obliged to participate in unemployment insurance if they meet certain criteria, but foreign workers are exempt. However, starting January 1, 2022, foreigners will be required to participate in other types of compulsory social insurance. This information is based on the Employment Law of 2013 and the Law on Social Insurance of 2014. Unemployment insurance serves as a crucial mechanism to safeguard the income of workers when they lose their jobs, while also assisting them in retraining, sustaining themselves, and seeking new employment opportunities. However, there are reasons why foreigners are not required to participate in this system when working in Vietnam. According to current regulations, foreigners who are citizens of other countries working in Vietnam under labor contracts are not subjected to participate in the unemployment insurance scheme. Details Under Article 43 of Employment Law No. 38-2013-QH 13, subjects required to participate in unemployment insurance. 1. Employees must participate in unemployment insurance when working under a labor contract or employment contract as follows. a. Labor contract or working contract of indefinite term b. Labor contract or fixed-term working contract c. Seasonal or job-based working contracts with a term of between full 3 months and under 12 months In case a worker has signed and is performing more than one labor contract, the worker and the employer under the labor contract signed first shall participate in unemployment insurance. 2. Workers mentioned above who are currently on pension or doing housework are not required to participate in unemployment insurance. In addition, based on the provisions of Article 3 of the Employment Law 2013, the applicable employees of the Employment Law are a Vietnamese citizen who is full 15 years or older, has ability to work and seeks employment. Clause 1, Article 3 of the Employment Law 2013 Thus, although foreign workers have signed the labor contract with the employer, foreign workers are not subject to regulation by the 2013 Employment Law, so foreign workers are not subject to unemployment insurance according to regulations. From January 1, 2022, foreigners participate in the following types of compulsory social insurance. Employer 14% to Retirement and Death Fund 3% to the Sickness and Maternity Fund 0.5% to the Labor Accident and Occupational Disease Fund 3% to the Health Insurance Fund Employees 8% to Retirement and Death Fund 1.5% into the Health Insurance Fund Therefore, whether signing a short or long-term labor contract, foreign workers do not have to participate in unemployment insurance. Reference Source Employment Law 2013 No. 38-2013-QH13 Dated November 16, 2013 Law on Social Insurance No. 58-2014-QH13 Dated November 20, 2014 Decree 143-2018-NDCP Dated October 15, 2018 Gwinn-Do, Social Insurance, Salary Department