The 2025 Social Insurance Law: Key Changes Affecting Employees

The Law on Social Insurance No. 41/2024/QH15, passed by the National Assembly on June 29, 2024, and effective from July 1, 2025, fully replaces Law No. 58/2014/QH13. This new Law is regarded as a comprehensive reform, aimed at expanding benefits, encouraging long-term contributions, and strengthening social security for all individuals.

1. Expansion of Compulsory Social Insurance Coverage

One of the key changes in the new Law is the expansion of compulsory social insurance (SI) coverage to groups that were previously excluded, such as part-time employees at the commune, village, and neighborhood levels; owners of individual business households; and informal workers without contracts but with stable incomes.

2. Reduction of Minimum Contribution Period for Pension Eligibility from 20 to 15 Years

The new Law stipulates that employees are required to contribute to social insurance for only 15 years (instead of 20 years previously) to qualify for a pension. This change is especially significant for older workers who have recently joined the SI scheme, freelance workers who enrolled late in the voluntary SI scheme, and individuals with intermittent or non-continuous work histories.

3. Amendments to Regulations on Lump-Sum Social Insurance Withdrawal

The amended Law on Social Insurance tightens the conditions for lump-sum withdrawals. Under the new rules, employees are eligible for a lump-sum withdrawal only in specific cases, such as emigrating abroad, suffering from a critical illness, or having ceased SI contributions for 12 consecutive months without meeting the age or contribution requirements for a pension.

4. Introduction of a New Subsidy Regime and Adjustment of Benefit Levels

Regulations on one-time social insurance withdrawals have been tightened with the aim of keeping workers in the system to receive long-term pensions. The Law introduces two different application options:

For employees who participated in SI before July 1, 2025:

After 12 months of ceasing contributions, they may request a lump-sum withdrawal if their total contribution period is less than 20 years.

- For employees who start participating in SI on or after July 1, 2025:

- Lump-sum withdrawals will not be permitted, except in the following special cases:

+ Reaching retirement age with less than 15 years of contributions.

+ Permanently emigrating abroad.

+ Suffering from a life-threatening illness.

+ Other cases as stipulated by the Government.

5. Introduction of a Social Pension

The amended Law introduces a legal framework for social pensions. This provides support for elderly individuals aged 75 and above (reduced from 80) who do not receive a pension, as well as those aged 70 and above from poor or near-poor households who are not eligible to contribute to SI. These individuals will receive a social pension funded by the state budget. In addition, recipients will be provided with a free health insurance card.

6. Introduction of the “Reference Level” to Replace the “Basic Salary

From July 1, 2025, all regulations referring to the ‘basic salary’ will be replaced with a ‘reference level.’ This reference level will be defined in detail by the Government and will serve as the basis for calculating SI benefits. It will be adjusted annually in line with the CPI and economic growth.

7. Regulations on Sickness and Maternity Benefits

7.1. Sickness Benefits

The 2024 Law on Social Insurance, effective from July 1, 2025, introduces the right to take a half-day leave while still receiving sickness benefits (with the benefit for a half-day set at 50% of a full day’s benefit). It also specifies that a leave of less than half a day will be counted as half a day, and a leave of half a day to less than a full day will be counted as a full day.

The maximum duration of sickness benefits per year ranges from 30 to 70 days, depending on the SI contribution period and the nature of the work. For individuals requiring continued treatment for a long-term illness listed by the Ministry of Health, benefits will be provided at a reduced rate (65%, 55%, or 50%). In addition, if an employee is on sick leave for 14 days or more in a month, the SI Fund will continue to cover their health insurance premiums, thereby helping to protect both their health and financial security during extended periods of illness.

7.2. Maternity Benefits

One of the most groundbreaking changes is the introduction of a cash maternity benefit for participants in the voluntary social insurance scheme, thereby extending the social safety net to the self-employed.

For participants in the compulsory scheme, the new Law significantly enhances benefits: female employees are entitled to additional days off for prenatal check-ups and enjoy stronger protection in cases of infertility treatment or unfortunate miscarriages. Moreover, participants in the voluntary SI scheme (both men and women) will receive a cash benefit of VND 2 million per child, provided they have contributed to SI for at least six months within the 12 months preceding childbirth.

8. Funeral Allowance and Survivors’ Benefits

From July 1, 2025, the funeral grant will be calculated as 10 times the SI reference level at the time of the employee’s death, replacing the previous calculation based on the basic salary. This ensures a minimum grant of VND 23,400,000 (compared to VND 18,000,000 before July 1, 2024) and also applies to deceased pensioners and social allowance recipients.

The Law further expands eligibility for survivors’ allowances. Specifically, the relative who arranges the funeral—including the family of a retiree—is entitled to receive the grant. In addition, employees with children under 16 are eligible for an additional family allowance, supported by the pension and survivorship fund, to help ease the financial burden on young families.