approaching to the ilo ui provisions and the recommendations to improve vietnamese ui

“ Everyone has the right to work, to free choice of employment, to justand favourable conditions of work and to protection against unemployment”1 “ Everyone has the right to a standard o

FACULTY OF LAWUniversity of Lund

APPROACHING TO THE ILO UI PROVISIONS AND THE

Table of Contents

Table of Contents 2

Summary 3

Preface 4

Abbreviation 5

Chapter 1 THE CONCEPT OF THE UNEMPLOYMENT INSURANCE IN ILO PROVISIONS AND VIETNAMESE LAW 6

1.1 Unemployment and UI 6

1.1.1 Unemployment and UI in ILO provisions 6

1.1.2 Unemployment and UI in Vietnamese law 10

Chapter 2 THE CONTENT OF UNEMPLOYMENT INSURANCE IN THE ILO PROVISIONS AND VIETNAMESE LAW 13

2.1 The subjects participate to UI 13

2.1.1 The subjects participate in the UI in the ILO provisions 13

2.1.2 The subjects participate in UI in Vietnamese law 14

2.2 The conditions to get UI benefit 15

2.2.1 The conditions to get UI benefit in the ILO provisions 16

2.2.2 The conditions to get the UI benefit in Vietnamese law 16

2.3 The level of getting the UI benefit 17

2.3.1 The level of getting the UI benefit in ILO provisions 17

2.3.2 The level of getting the UI benefit in Vietnamese law 18

2.4 The duration of getting the UI benefit 18

2.4.1 The duration of getting UI benefit in the ILO provisions: 18

2.4.2 The duration of getting UI benefit in Vietnamese law 19

2.5 The UI fund 19

2.5.1 The UI fund in ILO provisions 19

2.5.2 The UI fund in Vietnamese law 20

Chapter 3 THE RECOMMENDATIONS TO IMPROVE VIETNAMESE UNEMPLOYMENT INSURANCE 21

3.1 The situation of employment and unemployment in Vietnam 21

3.2 The recommendations to perfect UI law in Viet Nam 23

3.2.1 The subjects participate and get UI benefit 23

3.2.2 The conditions to get the UI benefit 25

3.2.3 The level of getting UI benefit 28

3.2.4 The duration of getting UI benefit 29

3.2.5 The UI fund 30

CONCLUSIONS 33

Supplement A 36

Bibliography 38

According to the provision of ILO in UI and unemployment situation inVietnam, a lot of recommendations are raised to improve Vietnamese UI law

The thesis has three sections:

Chapter 1 The concept of UI in ILO provisions and Vietnamese law;Chapter 2 The content of UI in ILO provisions and Vietnamese law;Chapter 3 The recommendations to improve Vietnamese UI

Conclusion

Demand for labour and supply of labour are of great importance in mostcountries In the market economy, global integration and competition havebecome an indispensable part, which has greatly affected the workers’ jobs Thefact that many workers have lost their jobs has become popular in Vietnam.Therefore, this requires great efforts from workers as well as the State’sappropriate legal policies to support the labor market Consequently, UI policyplays a very important role in ensuring social security of the nation

Labor market integration and social-economic development are

important components for the birth of UI in Vietnam

Vietnamese UI is a regulation of social insurance It will be excuted in2009

Approaching to International Labour Organization (ILO) UI provisionsand Vietnamese present UI law will be the solid legal premise of UI in Vietnam.Base on those premises, this thesis will present some petitions to perfect themodel of a specific, modern and integrated UI of Vietnam A perfect UI systemwill guarantee for human rights on labour and aspiration to overcome proverty.And this will contribute to improving the Vietnamese social security system

- ILO: International Labour Organization

- Unemployment Insurance: UI

Chapter 1 THE CONCEPT OF THE UNEMPLOYMENT INSURANCE IN ILO

PROVISIONS AND VIETNAMESE LAW 1.1 Unemployment and UI

1.1.1 Unemployment and UI in ILO provisions

The problem of employment and the unemployees protection are legalproblems They are stipulated in the Human Right internationl documents Theemployees have the working right Besides, the employees have the enjoy

insurance right when they are unemployed These right are stipulated in article

23, 25 of the Universal Declaration of Human Rights

“ Everyone has the right to work, to free choice of employment, to justand favourable conditions of work and to protection against unemployment”1

“ Everyone has the right to a standard of living adequate for the health andwell-being of himself and of his family, including food, clothing, housing andmedical care and necessary social services, and the right to security in the event

of unemployment, sickness, disability, widowhood, old age or other lack oflivelihood in circumstances beyond his control”2

The right to social insurance, the right to work are one of the basic rights

of humans It isn’t only to be stipulated in national laws but also to be

acknowledged in international law The introduction of UI is an effective

method to create conditions for the basic rights of human beings, so that theright of citizens can become reality

The ILO set up the ineternational document system to protect the

employees right These conventions acknowledged the relation of employmentand the Humans Right’s employment The employees are treated equal and getthe welfares

Article 23 of the Universal Declaration of Human Rights

Article 23 of the Universal Declaration of Human Rights

According Convention No 102 (1952) of ILO: "Convention on minimumstandards of social security" has been approved by the meeting of the whole

organization, including the following policies: health care; illness,unemployment, old age; labour accidents; family assistance payments;

pregnancy; loss of workers; death allowance The countries that ratified this

Convention have applied the provisions of the convention on the legal system oftheir country and established a minimum system

To overcome and solve the situation of unemployment which is currentlyincreasing in the countries in the globalized economy is an urgent issue

Accordingly, depending on the conditions of each country, there will be

solutions to solve unemployment such as population policy, restricting migrationfrom rural to urban areas, reducing the age of retirement, strengthening

government and investment in the economy, pension dismissal, loss of

employment, UI

The concept of unemployment as it is defined in ILO regulation 3 :

Unemployment is the phenomenon of workers losing income ”due to

inability to obtain suitable employment in the case of a person protected who is

capable of, and available for, work After that, it was added “workers actively

looking for work

Then to, the concept is completed that “….the employees look for works

activity” in the Convention No 168 (1988)

- ILO considers the phenomenon of workers suffering "suspension of

earnings" as the criterion to identify the “unemployed” worker Additionally, theconditions to determine if a person is unemployed is if a worker do not have the

ability to find a suitable job but they are capable of working and ready to work

to generate income When the "permanent income" is lost by unemployment,

workers must "actively look for work" Thus, according to the provision of ILO,being without permanent income (by losing their job) is the only sign of

Article 20 of the ILO convention

unemployment To determine workers who are being unemployed when havethe additional conditions are not getting job, although workers have activelysought and desired to get a job We know that "unemployment" and "work"always is related relation Both have close relation with the "income".

“Unemployment” is the phenomenon of workers without work

Thus, The unemployees are the employees have not income when theylost jobs The working help the employees to get income The employees work

to get income and look after their family’s life So, when the employees lost job,their life and family’s life will become bad The birth of the UI which are seenthe effective measure for the uemployees insurance

Most developed countries in the world have built a system of UI to ensurelife for the unemployed such as the United Kingdom (1911), Italy (1919), toearly 1930 with the additional countries such as Sweden, Canada, the UnitedStates The countries have recognized the right of the unemployed and quicklymade UI a branch of the social insurance system Most countries don’t

considered UI just as measures to solve the consequences of unemployment.They considered UI as a policy of an active labor market And UI is not only apayment but also has the important function to promote the transition the

structure of industries, job protection, enhancement of worker career, findingjobs for the unemployed These activities are associated with the functioning ofthelabor market, and the activities to create jobs

According Convention No 102 of ILO about payments of UI

The UI is a part of social insurance to protect workers in case of loss ofemployment In addition to payments for the unemployed, UI also has additionalmeasures between the unemployed and the labor market such as: vocationaltraining, re-training, job brokers, career counseling, support expenses of theunemployed to establish business

The original legal recognition of UI is a regulation in the system of socialinsurance The appearance of this regulation makes insurance rights of human

beings better.The right to enjoy social insurance, also one of the basic rights of

citizens, are regulated in most of the constitutions of the countries in the world

Look at the social insurance system, and through the pension we can evaluate

the advantages of a social mode

UI is paid for the package as "unemployed" It does not stop at the

function to pay the income of the unemployed when losing their job UI,

according to ILO, is a part of social insurance to protect workers in case of loss

of employment

UI takes care of the rights of workers who have lost their jobs The

issuing and implementation of the UI contributes to effect on social security

policies of the country UI are important for social - political stability and can

create sustainable development for each country

The employment and job creation in order to limit unemployment is a

category under human rights, an issue which is legal in depth has been expressed

in international documents on human rights: "Freedom exit the fear of poverty

has been declared as the highest aspiration of all humanity " And "Everyone hasthe right to work, freely chosen profession, has been working conditions

favorable and legitimate, are protected against unemployment”[1]

To overcome and solve the situation of unemployment which is currentlyincreasing in the countries when we access the period of globalization is an

unrgent issue Accordingly, depending on the conditions of each country, there

will be solutions to solve unemployment such as population policy, restricting

migration from rural to urban areas, reducing the age of retirement, Governmentstrengthening and investment in the economy, pension dismissal, loss of

whole organization, including following policies: health care; illness,

unemployment, old age; labour accidents; family assistance payments;

pregnancy; loss of workers; death allowance The countries that ratified thisConvention have applied the provisions of the Convention on the legal system oftheir country and establish a minimum system

The right to social insurance, the right to work are one of the basic rights

of human It isn’t only be stipulated in national laws but also be acknowledged

in international law The introduction of UI is an effective method to createconditions for the basic rights of human beings, the right of citizens to becomereality

1.1.2 Unemployment and UI in Vietnamese law

The concept of unemployment in Vietnam

The concept of unemployment in Vietnam is: “Unemployment is a

phenomenon of no work in the determined period of time (paid work and theself-made), ready to work (a job be paid and the self-made) and looking forwork”4

However, because of the purpose of statistics, that concept has onlyshown "signs" of unemployment, but it has not shown the nature and content ofthe unemployment

To make it the accurate concept of unemployment , according to Dr LeThi Hoai Thu, one must consider the concept of "unemployed" in accordancewith "employment" as "all activities generating a source of incume and notprohibited by law "5

In consideration of the relationship with a job to make the definition ofunemployment: "unemployment is the state of those without income who have

Guide social spending professional in Viet Nam - General Statistics published in 1995

Article 13- The Labor Law of 1994

the ability to work, at age by the law stipulated that have no jobs or have lost

their jobs, and who are looking for job "6

The legislation on UI in Viet Nam has provisions on unemployment: "Theunemployed who contributes to UI and has lost job or terminated work contractbut has not found job "- according to chapter of the UI in social insurance law

Determining the subject of adjustment on UI and the basis for reviewing

the benefit of UI, the concept of unemployment is central

Thus, comparing the concept of unemployment as stipulated by ILO andstipulated in the law of UI Vietnam, the similarity with each other in the

regulation of unemployment is shown through the following characteristics:

- Being a person who used to be employed and have income from work

but has lost income because of job loss;

- Not being able to find a job despite having the ability to work and desirefor work

UI according to Vietnamese law

UI is a part of social insurance in the system of social security of the

country Until now, no official concept of UI has exsisted in Viet Nam

However, on the one hand, UI in Vietnam aims at ensuring income for the

unemployed On the other hand, UI create opportunities and favorable

conditions for unemployed people to go back to the labor market

Unemployment benefit is paid to people who are unemployed

Vietnamese UI is similar to the provisions of ILO UI is a mode-related

worker policy, aiming at ensuring the workers a stable life However, depending

on the economic conditions of each country, the UI is placed in social insurancesystem or independently as "UI" UI is different from other human insurance in

the system of business insurance UI is a part of the system of social security in

The support workers lose jobs and the method of construction mode of unemployment insurance in Viet

Nam-Dr Le Thi Hoai Thu – Ha Noi national university -2005

the country In each country, a well functioning of UI will improve positivesocial-economic efficiency.

Chapter 2 THE CONTENT OF UNEMPLOYMENT INSURANCE IN

THE ILO PROVISIONS AND VIETNAMESE LAW 2.1 The subjects participate to UI

The unemployment and the birth of unemploymnet insurance is a

necessary consequens of a market economy Each country must have a policyfor market adjustments adjustments appropriate to take care of benefits forworkers, especially the unemployed workers

Defining the subject of UI is an important issue in the a country TheState, employers and employees participate in UI Workers are the center of UIand the subject The workers get the benefit of UI when they participate in UI.But not all the workers who participate in UI can get unemployment benefit.Depending on the conditions and circumstances of each country, they regulatedthe law appropriately and most effectively for that country

2.1.1 The subjects participate in the UI in the ILO provisions

According to Convention No.102 of ILO provisions, the people whoparticipate in UI must be workers and get salary The Convention No.168 ofILO expanded the subjects participating in UI The Convention stipulates insome articles that in special cases, it can apply to some types of persons whowork for the first time, those who don’t relate to unemployed, those who neverhave been unemployed or have not participated in the protection ofunemployment

According to this Convention, the subjects participating in UI are theworkers who work to get salary and other subjects that also may have the right

to participate in the UI Provisions apply to some employees working for thefirst time, working at home, getting salary in the range of public services of thestate, the workers who have not reached to the age conditions, people that havereached the age of retirement and having enough income to ensure participate in

UI We can list as below:

- The youth who finish vocational training program;

- The young people who have completed the school program;

- The young people who have completed military obligations required;

- Those who leave job to look after children, take care of sick people, thehandicapped, the elderly;

- People who are windowed;

- People who does not get to allowance while at school;

- People who divorced;

- Those who expires imprisonment;

- People who have grown-up;

- Handicapped people who have graduated from training courses;

- The overseas people who return to the country, unless in the case theyget benefits according to the law of the country where they have worked

previously;

- People who previously have been self employed

Thus, from the Convention 168 ILO has encouraged the expansion ofsubjects participating in UI, and apply to the UI for all part-time employees, andthe subjects who do nothing, and the part-time employees want to find full-timejob

UI can to apply to most subjects This reflected the improvement of thesocial welfare

2.1.2 The subjects participate in UI in Vietnamese law

According to the law of Vietnamese UI, the subjects participating in UIconsist of employees and employers

The provisions on employees states: employees who are Vietnamese

citizens who work on employment contracts without limit the time, or those whowork on contracts from 12 to 36 months

The provisions on employers states: employers participating in UI is

regulated: those who have 10 or more employees The employers are state

agencies, political-social agencies, political organizations, social career

organizations, foreign organizations, international organizations operating in theterritory of Vietnam; companies or small individual business These employershire employees and pay salary

The UI is a part of the social insurance system and belongs to the socialsecurity policies Therefore, the nature of the UI is to take care the employeesand their interest The UI stipulated by the ILO Convention has various

participating subjects Every employee has the right to participate in the UI

Vietnamese law limits the subjects participating in UI by the followingregulations:

- The UI is applied to the employers using from 10 and more employees;

- The articles regulate to the term of employment contract as below:+ The contract has unlimited term;

+ For the limited labour contracts, the term is 12-36 months

The term of employment contract ensures the employees have enoughtime to contribute to the UI fund These regulations help the management andmakes the benefit payment more convenient

The conditions on the term of labour contracts stipulated to be 12-36months is enough for the employees to contribute the UI fund Almost all

employmnet contracts in Vietnam are short-term because of the socio-economycharacteristic Most of the employees sign only daily-contracts informally It isdifficult to determine the unemployment situation of the employees Therefore,with this in mind, the management of insurance fund is not easy

2.2 The conditions to get UI benefit

To get the UI benefit, the employees must participate in the UI But all theunemployed have right to get the UI benefit

2.2.1 The conditions to get UI benefit in the ILO provisions

UI law is a part of the legal social insurance system The nature of UI is tosupport and to take care of the unemployee’s interests Who will have right toget the UI benefit?

According to article 20 of ILO Convention No.102

Convention regulates about the conditions to get the UI benefit as follows:+ The unemployeds’ income from work is interrupted but they can not findanother suitable work to do and really want to work

+ The employee must satisfy the term of contribution to the UI fund;

+ The cause of unemployment is not caused by the employee In this case,the unemployed has the duty to prove;

+ The unemployed must register to find job at the labour office during theunemployment;

+ In some cases, national law may have special exception provisions

The conditions stipulated above is appropriate to determine effectivelythe object of the UI payment Besides, the unemployed can be denied the right toget the UI benefit when the unemployee does not approve to do an appropriatework - [Section 1 of article 21- Convention No 168]

The purpose of these provisions restricts the UI payment to the

unemployed who do not want to work

2.2.2 The conditions to get the UI benefit in Vietnamese law

The unemployed who get the UI benefit as regulated must satisfy thefollowing conditions - [Article 81- The Vietnam social insurance law]

- During the 24 months before unemployment, the employees must havecontributed the UI fund for 12 months or more;

- After 15 days of unemployment registration at social insurance office,the unemployed have a right to get the UI benefit

Thus, the UI benefit is clearer than the receiving of other social insurancebenefits.

In brief, the conditions of the unemployment contribution term in

Vietnam is clearer than the stipulations of ILO The conditions of

unemployment registration are considered very important to manage and controlthe UI fund The Vietnamese UI emphasize the interruption of income duringthe unemployment term In Vietnam, it is difficult to determine the relationshipbetween the unemployment and the interruption of income because in the

unemployment term, the unemployed lose the revenue Actually, the

unemployed can get another income in this period

In the Article 87- The social insurance law, the UI benefit termination isregulated:

- The expiration of getting unemployment benefit;

- The unemployed have a new job;

- The unemployed join the army;

- The unemployed get retirement pension;

- After twice refusing to take an appropriate work introduced by socialinsurance office (except for good reasons);

- Do not set up UI file for three successive months;

- The unemployed go abroad to settle;

- Serving a penalty;

- The unemployed dies

- In case of terminating the benefit due to a new job or joining the army inthe unemployment term, the unemployed can get the benefit once

2.3 The level of getting the UI benefit

2.3.1 The level of getting the UI benefit in ILO provisions

The level of subsidies is based on the contribution level and the

contribution term to UI fund

The benefit level must guarantee the poverty line of the unemployed.The amount of benefit is calculated based on previous income.

The benefit amount will be fixed to not less than 50% the minimumwages or the wages of ordinary employees, and guaranteeing the basic livingstandard

In general, the provisions of the Convention guarantee the principle ofcreating the best conditions for employees to get a stable life

2.3.2 The level of getting the UI benefit in Vietnamese law

According to the law of Vietnam, when a person fully satisfies the

conditions of getting the unemployment benefit, the subsidies for the

unemployed are calculated as 60% of the average salary of six months beforeunemployment This amount of money can be paid every month for the

unemployed - [Article 82 - the law on social insurance in Vietnam]

The purpose of the UI payment is to help the unemployed to have a stablelife and create opportunities for them to seek a new job in the unemploymentperiod If the payment level is too high, the UI fund will not guarantee for thefull payment of previous salary Besides, the employees will not seek jobs

actively if they just expect the UI benefit

2.4 The duration of getting the UI benefit

The maximum duration of UI benefit depends on the contribution to the

UI fund and participatting term The regulations differs due to the

socio-ecomomy conditions of the country With a low rate of unemployment and theemployees have the ability to look for work, the period of getting UI benefit will

be shorter

2.4.1 The duration of getting UI benefit in the ILO provisions:

Article 19 ILO Convention No.168 says:

Each countries can limit the UI period to 26 weeks if the unemployed hascontributed to the UI of 24 months

The UI fund does not pay in the case the unemployed until after 7 days.

2.4.2 The duration of getting UI benefit in Vietnamese law

In Vietnam, the period of getting UI benefit stipulated in Article 87 - thelaw on social insurance is:

- The Duration is 3 months if the unemployee contributes enough from 12

to 36 months to UI fund;

- The Duration is 6 months if the unemployee contributes enough from 36

to less than 72 months to UI fund;

- The Duration is 9 months, if the unemployee contributes enough from

72 months to less than 140 months to UI fund;

- The Duration is 12 months if the unemployment contributes enough 144months to UI fund;

- The Duration of getting the UI benefit is calculated based on the UIfund, but the maximum does not exceed 12 months Beside getting UI benefit,the unemployee can also be supported for 6 months vocational training Afterbeing supported by short-term vocational training (the unemployee can move tonew job) in this term, the unemployee can be adviced to seek for a new job forfree The unemployed also can get the health insurance The social insuranceoffice has the responsibility to provide this insurance for the unemployed

2.5 The UI fund

2.5.1 The UI fund in ILO provisions

The UI fund is formed from the contributions of the parties which

participate to UI This fund is used to pay benefits and help the unemployed toreturn to labour market

The UI fund is administrated by two rules:

- Provisions on who will contribute to UI;

- Provisions on the management of the UI fund