Job loss allowances

Job loss allowances

When the employee loses his job because the employer changes structure, technology or because of economic reasons, in addition to the severance allowance as prescribed in Article 49 of the Labor Code, employees are also entitled to unemployment allowance if they fully meet the conditions specified in Article 49 of the Employment Law.

(As reflected by Ms. Nguyen Thi Kim (in Tuyen Quang Province), the employer unilaterally terminates the labor contract (labor contract) with the person whose contract is indefinite by deciding to leave redundant work and only to pay job-loss allowance for the years not yet participating in unemployment insurance, in addition, the employee is not paid any other payment.

Mrs. Kim asked, in addition to the severance allowance, what other benefits will employees be paid?

Regarding this issue, Lawyer Tran Van Toan, the Khanh Hung Lawyer’s Office – the Hanoi Bar Association answers as follows:

Under the provisions of Article 44 of the Labor Code, the case of structural or technological change affecting the employment of many workers, or the case where many employees are in danger of losing their jobs due to economic reasons. If they work or have to quit their jobs, the employer shall be responsible for formulating and implementing the employment plan according to Article 46 of this Code; In case of having a new workplace, priority is given to re-training the employee for continued employment.

In cases where the employer cannot solve the new job but has to let the employee quit his/her job, he / she must pay the job loss allowance to the employee according to the provisions of Article 49 of this Code.

Termination of jobs for many employees in case of structural, technological or economic changes can only be done after consulting with the representative organization of the labor collective at the grassroots level and giving prior notice. 30 days for the labor state management agency at the provincial level.

Severance allowance

Article 49 of the Labor Code stipulates that the employer shall pay the job loss allowance to the employee who has been working for them regularly for 12 months or more but has lost his job as prescribed in Articles 44 and 45 of this Code, each working year pay 1 month's salary but at least equal to 2 months' salary.

The working time used to calculate the job loss allowance is the total time the employee actually worked for the employer minus the time the employee has participated in unemployment insurance under the Law on Social Insurance and the working time has been paid the severance allowance by the employer.

The salary used to calculate the job loss allowance is the average salary under the labor contract of the six preceding months before the employee loses their job.

Condition for enjoying unemployment allowance

Article 49 of the Employment Law stipulates that the person currently paying unemployment insurance is entitled to unemployment allowance upon termination of the labor contract when fully meeting the following conditions:

He/she has paid unemployment insurance premiums for full 12 months or more within 24 months prior to termination of indefinite or definite term labor contracts; has paid unemployment insurance premiums for full 12 months or more within 36 months before terminating the seasonal labor contract or under a certain job with a term of full 03 months to less than 12 months.

The application for unemployment allowance has been submitted to an employment service center as prescribed in Clause 1 Article 46 of this Law; has not found a job after 15 days from the date of filing the unemployment insurance claim.

Article 50 of the Law on Employment stipulates that the monthly unemployment allowance is equal to 60% of the average monthly salary paid for unemployment insurance for the six preceding months before being unemployed, but must not exceed 5 times the base salary. for employees who are subject to the salary regime prescribed by the State or not exceeding 5 times of the regional minimum salary as prescribed by the Labor Code, for employees paying unemployment insurance under the regime. The salary is decided by the employer at the time of terminating the labor contract or working contract.

. The period of enjoying unemployment allowance is calculated according to the number of months of unemployment insurance payment, for every 12 to full 36 months of payment, he / she will enjoy 3 months of unemployment allowance, after that, for every 12-month full payment, he / she will enjoy an additional 1 month of unemployment benefit but not more than 12 months maximum.

The time for enjoying unemployment allowance is counted from the 16th day, counting from the date of submitting a complete dossier for unemployment benefit entitlement under Clause 1, Article 46 of this Law.

Responding to the question asked by Ms. Nguyen Thi Kim, based on the provisions of the Labor Code and the Employment Law, when the employee loses his job because the employer changes structure, technology or due to economic reasons. However, in addition to the job loss allowance as provided in Article 49 of the Labor Code, the employee is also entitled to the unemployment allowance, if meeting all the conditions specified in Article 49 of the Law on Employment; with the level of entitlement, duration of entitlement and time of enjoyment of unemployment allowance under Article 50 of this Law.

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