Unemployment benefits: Conditions, benefits and calculation

Unemployment benefits are the rights of employees when they lose their jobs due to objective reasons from the business. Understanding the conditions, benefit levels and calculation of benefits is extremely important to protect your rights in case you no longer have a stable job. In this article, we will learn about regulations related to unemployment benefits according to the Labor Code 2019.

Cases entitled to unemployment benefits

Based on Clause 1, Article 47 of the Labor Code 2019, to be eligible for unemployment benefits, employees must simultaneously meet the following two conditions:

Working time: The employee must have worked regularly for the employer for 12 months or more.

Cause of job loss: The employee lost his job due to one of the following reasons:

• Enterprises change their structure (products, operating processes, machinery, technology…), reorganize labor, production equipment, and business lines.
• Businesses are affected by the economic crisis and recession.
• Enterprises carry out international commitments on production or State policies when restructuring the economy.
• Enterprises are divided, separated, consolidated, and merged.
• Enterprises sell, lease, or convert business types.
• Enterprises transfer ownership or use rights to assets.

From there, employees who work under a labor contract for a period of 12 months or more and quit due to objective reasons will be entitled to unemployment compensation according to current legal regulations.

How to calculate unemployment benefits

Calculation of unemployment benefits is done based on the following factors:

Working time calculates unemployment benefits

Working time for calculating benefits is the total time the employee actually works for the enterprise, minus the time spent participating in unemployment insurance and the time for which severance and job loss benefits were previously paid. This time will be rounded by year, with years containing 6 months or less being counted as half a year.

Salary used to calculate unemployment benefits

The salary used to calculate unemployment benefits is the average salary of the 6 consecutive months before terminating the last labor contract. In case the final labor contract is declared invalid, the salary will be agreed upon but not lower than the regional minimum wage.

Formula for calculating unemployment benefits

The formula for calculating benefits is: Benefit = Working time for calculating benefits (years) × Salary to calculate benefits.

In particular, the working time for calculating benefits is the total actual working time minus the time previously participating in unemployment insurance and benefits.

Notes when paying unemployment benefits

When paying unemployment benefits, the following issues should be kept in mind:

• Ensuring payment eligibility: Employees are only entitled to job loss benefits when they meet the conditions according to Article 47 of the Labor Code 2019, including working time and reasonable reasons for job loss.
• Payment procedures: Employers must fully implement benefit payment procedures, including confirmation of working time, salary and other related documents.
• Payment time: Job loss allowance must be paid within 30 days from the date the labor contract terminates, unless otherwise agreed.
• Valid documents: Documents, invoices, and papers related to the payment of unemployment compensation must be fully and validly archived according to the provisions of law.
• Ensuring benefits for employees: Employers need to ensure the legal rights of employees, avoiding incorrect payments or not paying unemployment compensation when employees are eligible.

Consulting on regulations on unemployment benefits according to current standards

At Long Phan Consulting Company, we provide customers with consulting services on regulations on job loss benefits as follows:

• Consulting on necessary regulations and conditions to qualify for unemployment benefits.
• Detailed instructions on how to calculate actual working time, unemployment insurance participation period and exclusion periods when calculating job loss benefits.
• Provide information about the minimum level of benefits that employees can receive according to regulations.
• Provide detailed information on employee rights in cases of job loss, as well as employer obligations.
• Support customers to calculate job loss benefits according to current regulations.
• Advise on how to resolve a dispute.

FAQs about unemployment benefits

Below are some questions about unemployment benefits that customers can refer to:

If a business changes its location of operations, are employees entitled to unemployment compensation?

If a change of location makes it impossible for the employee to continue working, they may be entitled to unemployment compensation.

Do employees need to follow any special procedures to receive unemployment compensation?

No, businesses are responsible for paying benefits when employees meet the conditions prescribed by law.

Are unemployment benefits subject to personal income tax?

No, unemployment benefits are not subject to personal income tax.

Can employees receive unemployment compensation if they voluntarily quit their job?

No, unemployment compensation only apply when employees lose their jobs due to objective reasons from the business.

If an enterprise is late in paying unemployment compensation, what rights do employees have?

Employees have the right to complain to the labor management agency or sue in court to request full and timely payment.

Is the probationary period counted as working time to receive unemployment benefits?

Yes, the probationary period is included in the total actual working time.

Does the salary used to calculate unemployment benefits include allowances?

The salary for calculating benefits is the average salary of the 6 consecutive months before terminating the labor contract, including salary allowances, if any.

If a business goes bankrupt, will employees receive unemployment compensation?

In this case, the employee still has the right to request payment of unemployment compensation according to the provisions of bankruptcy law.

Do employees have the right to request businesses to provide information about the reason for losing their job?

Yes, employees have the right to request the company to clearly explain the reason for losing their job and provide relevant documents.

If employees do not agree with the amount of redundancy pay calculated, what can they do?

Employees have the right to request the enterprise to clearly explain the calculation method or complain to the local labor management agency or sue in court.

Conclude

Job loss allowance is a legal right of employees to support during difficult times after losing their job. Customers need to master the regulations and procedures to ensure they receive benefits on time and at the right level. If you have any problems, please contact us via the hotline 0906735386 for detailed advice and support. Long Phan Consulting Company’s experts support customers in a dedicated way.