1. Severance/Job Loss Benefits

According to the provisions of Articles 46 and 47 of the 2019 Labor Code:

Article 46. Severance Pay

1. When an employment contract is terminated under the provisions of Clauses 1, 2, 3, 4, 6, 7, 9, and 10 of Article 34 of this Code, the employer is responsible for paying severance pay to employees who have worked regularly for them for 12 months or more. The severance pay shall be equivalent to half a month's salary for each year of service, except in cases where the employee qualifies for retirement benefits in accordance with the law on social insurance and in cases specified in Point e, Clause 1, Article 36 of this Code.

2. The period of employment used to calculate severance pay is the total actual working time of the employee for the employer, excluding the time during which the employee participated in unemployment insurance as stipulated by the law on unemployment insurance and the time for which the employer has already paid severance or job loss benefits.

Article 47. Job Loss Benefits

1. The employer shall pay job loss benefits to employees who have worked regularly for them for 12 months or more and have lost their jobs as defined in Clause 11 of Article 34 of this Code. For each year of service, the employer shall pay one month's salary, but this amount shall not be less than two months' salary.

2. The period of employment used to calculate job loss benefits is the total actual working time of the employee for the employer, excluding the time during which the employee participated in unemployment insurance as stipulated by the law on unemployment insurance and the time for which the employer has already paid severance or job loss benefits.

Accordingly, when terminating employment, employees will receive severance/job loss benefits if they meet the aforementioned conditions. However, it is important to note that the period of employment used to calculate severance/job loss benefits is the total actual working time for the company/business, minus the time spent participating in unemployment insurance and the time for which the business has already paid severance or job loss benefits.

2. Unemployment Benefits

Severance/job loss benefits will be paid by the employer. However, unemployment benefits will be provided by the Social Insurance Fund.

According to Article 49 of the 2013 Employment Law, employees who are contributing to unemployment insurance are entitled to unemployment benefits when they meet the following conditions:

- Termination of the employment contract or work contract, except for the following cases:

+ Employees unilaterally terminate the employment contract or work contract unlawfully;

+ Receiving a monthly retirement pension or disability benefits;

- Have contributed to unemployment insurance for 12 months or more within the 24 months preceding the termination of the employment contract or work contract.

- Have submitted an application for unemployment benefits at the employment service center as required.

- Have not found employment within 15 days from the date of submitting the unemployment insurance application, except for the following cases:

+ Performing military service or police duties;

+ Studying for a period of 12 months or more;

+ Complying with a decision to be placed in a reform school, mandatory education facility, or compulsory rehabilitation center;

+ Being temporarily detained; serving a prison sentence;

+ Moving abroad for settlement; working abroad under contract;

+ Death.

- According to Article 50 of the 2013 Employment Law, eligible employees will receive unemployment benefits calculated as follows:

Monthly Benefit Amount = Average monthly salary contributing to unemployment insurance of the preceding 6 months before unemployment × 60%

Note: The duration of unemployment benefits is calculated based on the number of months contributing to unemployment insurance. For every 12 months of contributions up to 36 months, the employee is entitled to 3 months of unemployment benefits; thereafter, for every additional 12 months of contributions, the employee is entitled to an additional month of unemployment benefits, with a maximum limit of 12 months.

This article is for reference only and is not intended to be used as advice. If you need advice, please contact us via email: info@barrso.com