As per Decree 158/2025/ND-CP, which comes into effect on July 1, 2025, the basis for compulsory social insurance contributions includes not only the basic salary but also allowances and regular supplements as stipulated in the labor contract.
The new regulation aims to ensure that social insurance contributions and benefits reflect the actual income of employees and protect their full entitlements related to maternity, retirement, sick leave, and long-term benefits.
Low basic salary in the contract puts employees at a disadvantage
Under the previous regulation, Decree 115/2015/ND-CP, the basis for social insurance contributions included only the basic salary and some allowances. Most other supplements, such as bonuses, sales commissions, and overtime pay, were not taken into account, resulting in significantly reduced maternity and retirement benefits.
In reality, many women working in retail, services, beauty, and education sectors receive a low basic salary, with most of their income coming from fixed allowances and living support. For example, Ms. Thuong, a sales employee at a cosmetics store in Quang Ninh, earns a monthly income of VND 10 million, but her labor contract states a basic salary of only VND 5 million. The remaining amount comprises responsibility allowances, transportation allowances, and sales commissions. According to the old regulation, social insurance contributions were calculated based on the basic salary of VND 5 million, resulting in a significant loss of benefits during her maternity leave.
With the new Decree 158/2025/ND-CP, if the allowances and supplements are regularly paid and clearly stated in the contract, Ms. Thuong’s social insurance contributions will be based on a more accurate reflection of her actual income, leading to higher benefits during maternity or retirement.
Employees should not lose retirement or maternity benefits due to a lack of information (Illustrative image)
Composition of salary basis for compulsory social insurance contributions (effective from July 1, 2025)
| Salary Component | Detailed Explanation | Included in Social Insurance Contributions? | Notes |
|---|---|---|---|
| 1. Salary based on job or position | Salary calculated based on time (monthly) and stipulated in the labor contract, following the company’s salary scale (as per the Labor Code) | Yes | This is the mandatory basic salary that must be included. |
| 2. Salary Allowances | Compensation for working conditions, environment, complex nature of work, living expenses, labor attraction, etc. | Yes | As long as it is clearly stated in the labor contract and paid regularly. |
| * Variable Allowances (based on productivity, efficiency, etc.) | Allowances linked to work results, productivity, and quality | No | Not stable and not included in social insurance contributions. |
| 3. Other regular supplements | Specific supplements paid with each salary period and stipulated in the contract | Yes | For example: fixed responsibility allowances, fixed transportation allowances, etc. |
| * Variable supplements | Payments based on work performance, sales, KPIs, etc. | No | Not paid regularly or not specified in the contract. |
| 4. Salary paid in foreign currency | Cases where the labor contract stipulates payment in foreign currency | Yes (after conversion to VND) | Converted according to the exchange rate of the four major banks on January 2 and July 1 of each year. |
| 5. Non-specialized labor in communes, villages, and residential groups | Based on the monthly allowance | Yes | If the allowance is < minimum wage, it will be calculated based on the minimum social insurance contribution wage. |
| 6. Labor paid by the hour/day/week | Converted to a monthly salary for social insurance calculation | Yes | Formula: Hourly wage × number of hours/month; daily wage × number of days/month… |
Recommendations for female employees
1. Proactively review the contents of your labor contract, especially the income components that are stable and regular, to ensure that the basis for social insurance contributions reflects your total actual income.
2. Communicate specifically with the accounting or human resources department to understand the current basis for social insurance contributions and verify if the fixed allowances have been fully included.
3. For employees receiving their salary through bank transfers, carefully compare the monthly salary statement with the labor contract. In case of unreasonable discrepancies between the social insurance contribution wage and actual income, employees can request adjustments to safeguard their long-term benefits, especially during maternity leave, sick leave, or retirement.
Decree 158/2025/ND-CP marks a step forward in transparency and fairness in social insurance contributions. For women, who are often at a disadvantage due to low wages and unclear contracts, understanding this new regulation is key to protecting their long-term welfare entitlements.
