On March 10, 2025, Vietnam's social insurance framework witnessed significant updates concerning early retirement parameters and pension adjustments, aiming to improve the conditions for officials and employees. The Government's Decree No. 178 stipulates clear conditions under which employees can retire early, responsive to both voluntary and compulsory retirement requests.
According to the regulations, to qualify for early retirement, officials must meet stringent criteria assessed by the Vietnam Social Security (VSS). Criteria include ethical conduct, professional competence, and adherence to work discipline. VSS specifies, "The pension level for male workers is calculated as 45% corresponding to 20 years of insurance contribution; for female workers, it's 45% corresponding to 15 years." This reflects the government's effort to adjust pensions according to the number of years contributed to social insurance.
For employees opting for voluntary retirement, they must have served at least 10 years or be within 5 years of the legal retirement age and have contributed the requisite period to social insurance. This is part of the government’s broader strategy to efficiently manage its workforce and reallocate personnel where needed. Public sector leaders with surplus positions or unsatisfactory performance evaluations could also find themselves subject to these criteria, as VSS has outlined various circumstances where voluntary resignations would be permitted.
The new retirement age standards dictate men will retire at 61 years and 3 months, and women at 56 years and 8 months, positioning 2025 as a transformational year for social insurance laws. Importantly, for those retiring before July 1, 2025, eligibility for pensions still hinges upon reaching the stipulated retirement age alongside having contributed to social insurance for at least two decades, ensuring the sustainability of funds for pensions on the whole.
Following July 1, 2025, significant changes will take effect under the 2024 Law on Social Insurance, which will lower the threshold for the minimum required social insurance contributions for retirement from 20 to 15 years. This means workers will now have greater accessibility to pensions, aiming to support those who may have faced challenges securing full-time employment for many years.
Importantly, workers under the new law will see their pensions calculated based on their average salary contributions, now inclusive of rights acquired through high-cost regions. For example, male laborers with contributions of 15-20 years will receive 40% of their average salary for the first 15 years worked, reflecting another layer of adjustment aimed at bolstering pension equality.
Additional adjustments due to recent legal amendments will address those who may struggle to meet new educational or training standards, granting leeway for those facing relocations or administrative shifts impacting their job duties. The intent is clear: the government sees this as not just about numbers on paper but as enhancements to worker welfare amid shifting labor dynamics.
VSS has also highlighted the necessity for timely increases to pension payments to reflect inflation and the rising cost of living. Adjustments outlined by Decree 75/2024 indicate comprehensive pension boosts starting at 15% of the 2024 levels, ensuring citizens see real change month to month. For those whose pensions fall below 3.5 million VND after these adjustments, additional increases will apply: if below 3.2 million VND, pensions will rise by 300,000 VND per person. This tiered adjustment is aimed at minimizing disparity among retirees.
Effective strategies like these align with the government's goal to bridge the financial gaps between various groups within the retired population. From July 1, future pension calculators will change to sustain fairness across rural and urban settings, thereby enhancing the eligibility scope across the professional spectrum.
Vietnam's strategic alterations to both retirement age and pension structures reflect dedication toward developing and sustaining its labor force welfare mechanisms. Stakeholders are urged to remain engaged, ensuring compliance with upcoming regulations and renewed standards of care for the elderly workforce. Such reforms not only focus on legal compliance but also on fortifying social systems through equitable financial support and social investments.
By maintaining current dialogue about these legislative changes, citizens can navigate their professional pathways with clarity, securing their welfare against uncertainties brought about by employment shifts and economic changes.