The Ho Chi Minh City Social Insurance Agency has taken drastic measures to check employers’ payment of social insurance premiums for their employees and claim premium debts while the current regulations are not stiff enough to deter employers from neglecting to pay the premiums.
According to the agency, 51 companies in the city owned social insurance premiums for over one year, totaling VND28.7 billion, by September.
To prevent enterprises from leaving their insurance debts for a long time, early this year, the agency asked labor inspectors to strictly penalize enterprises that violate social insurance regulations, and urged relative units to check payment and collect premiums.
As a result, the city’s social insurance agencies inspected 168 enterprises that owe insurance premiums, and collected total VND32.2 billion in insurance premiums in the first nine months of the year.
These agencies also sued 56 enterprises for unpaid insurance fees, and then collected VND5.3 billion from them.
According to the agencies, enterprises agreed to pay insurance only when they were inspected and prone to face lawsuits.
For instance, Viet Nhat Manpower Development JS Company paid its premium debt of VND313.2 million right after the HCMC Social Insurance Agency had launched legal action against it.
After the inspection, six companies have paid all of their premium debts.
Some of companies committing insurance violations were Phu An Sinh Trade and Food Processing Company, Le Garment Company, Mai Binh Tran Garment Company, and Viet Sinh International JS Company.
Labor officials attributed the evasion of social insurance premiums to the low fine imposed on violators.
According to the current regulations, enterprises owing insurance fees can only be fined for the offence once a year, and the fine cannot exceed VND30 million.
The highest penalty was raised from VND20 million to VND30 million from October 1.
In addition, many employers do not draft clear labor contracts and fail to provide accurate payrolls for their workers, making collection of insurance extremely difficult.
The HCMC Social Insurance Agency said trial procedures also consume lots of time.
Suing enterprises is only the last resort as many cities and provinces have found that launching legal action against firms committing violations met many obstacles.
Procedures to sue a firm are too complicated and include many stages, such as checking, inspection, administrative fines and launching a lawsuit is the last stage.
When all these procedures are completed, courts may still take a long time to resolve lawsuits, especially if enterprises involved in lawsuits face bankruptcy.
