20220113-KPMG_Global-Vietnam_–_Social_Insurance_Agreement_Signed_with_South_Korea_3页_344kb

Vietnam-South Korea Social Insurance Agreement Summary

Agreement Background

• Signed on December 14, 2021, between the Socialist Republic of Vietnam and the Republic of Korea by Vietnam's Minister of Labour, War Invalids and Social Affairs and South Korea's Minister of Health and Welfare.
• Covers the pension regimes under Vietnam's Law on Social Insurance and South Korea's National Pension Act.

Key Purposes and Benefits

• Aims to avoid double payment of social insurance and mutually recognize contribution periods.
• Provides social security protection for cross-border workers, ensuring uninterrupted benefits when working abroad.
• Helps avoid double coverage for temporary assignments, influencing employee decisions on assignments.
• Facilitates the cross-border movement of workers between the two countries.

Key Provisions

• Scope: Includes Vietnam's pension and survivorship regime and South Korea's pension regime.
• Subject: Applies to Vietnamese and Korean employees working temporarily abroad, including dependents for survivorship benefits.
• Equal Treatment Principle: Ensures mobile workers are treated equally regarding contributions and benefit entitlements.
• Timing Aspects: Contribution time accumulates across countries; benefits calculated based on each country's laws.

Significance and Impact

• The first bilateral Social Insurance Agreement for Vietnam, potentially paving the way for negotiations with other countries.
• May lead to amendments in Vietnam's Law on Social Insurance to align with the agreement, particularly on foreign contribution recognition and retirement pension calculations.
• KPMG notes that Vietnam could expand such agreements to enhance international cooperation.