ADMINISTRATIVE PENALTIES FOR ENTERPRISES DELAYED IN PAYING SOCIAL INSURANCE

According to Article 7 of Decision No. 505/QD-BHXH  2017 on procedures for collecting social insurance contributions and premiums of health insurance, unemployment insurance, occupational accident, and occupational disease insurance; issuing social insurance books and health insurance cards, supplemented by clause 13 Article 1 Decision No. 505/QH-BHXH 2020, if choosing a monthly payment method for social insurance, employers must pay for compulsory social insurance no later than the last day of the month. 

In cases where the subjects are paid social insurance on a 3-month or 6-month basis, the enterprise must pay the social insurance no later than the last day of that payment period. 

If delaying the payment of social insurance compared to the above deadline, the enterprise will violate one of the prohibited acts under clause 2 Article 17 of Social Insurance Law 2014 (from now on referred to as SIL 2014). As a result, the enterprises will be handled under Article 122 of SIL 2014 as follows: 

If delaying the payment of social insurance for 30 days or more, besides fully paying the amount not yet paid or paid late and be handled under law but also pay an interest equalling to 2 times the average interest rate of investment from the social insurance fund in the preceding year, calculated based on the late paid amount and late payment period. If they fail to do so, at the request of competent persons, related banks, credit institutions, or state treasuries shall deduct money from the employers’ deposit accounts to pay the amount not yet paid or paid late and the interest thereon to the accounts of social insurance agencies.

Under clause 5 Article 39 of Decree No. 12/2022/ND-CP, if the enterprises make late payment of compulsory social insurance, the enterprises will receive a fine equal to 24% under 30% of the total amount of compulsory social insurance and unemployment insurance premiums payable at the date of issuance of violation record, but not exceeding VND 150.000.000. Meanwhile, the enterprises applied remedial measures that are compelled to pay the total amount of compulsory social insurance and unemployment insurance premiums payable to social insurance authorities. If the enterprises violate for at least 30 days, they applied remedial measures that are compelled to pay an interest rate equalling 2 times of the average interest rate of investment made by the social insurance fund in the previous year calculated on late payment, non-payment, evasion of payment or appropriation of payments; if not doing so, according to the requirements of competent people, banks, and other financial organizations, or state treasuries shall withdraw money from the violating employer’s deposit accounts to transfer deferred amounts or outstanding amounts of insurance premiums plus the interest on such amounts, which is calculated at the highest rate of the demand deposit interest rates publicly quoted by state-owned commercial banks on the date of penalty imposition, to the account of the relevant social insurance authority. 

Tran Linh - FDVN Law Firm