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Many foreign workers in Vietnam find themselves in a rather unexpected situation: after quitting their jobs and preparing to withdraw their social insurance contributions, they discover that their former company has gone bankrupt, ceased operations, or they can no longer contact it. Some only worked in Vietnam for a few years before returning to their home country. Others quit long ago and only start searching for their records when they need to process their social insurance. In many cases, the company email is no longer active, the human resources department has been dissolved, or the former manager is no longer working in Vietnam.
The biggest concern for many is: if the company has gone bankrupt or closed down, will the social insurance contributions they have paid over many years be lost?
According to the 2024 Social Insurance Law, foreign workers in Vietnam are subject to mandatory social insurance if they have a valid work permit, professional certificate, or professional license and have signed a labor contract as prescribed.
During their employment in Vietnam, both the employee and the employer are obligated to contribute to social insurance at the rate stipulated by law. This amount is recorded in the social insurance system and linked to the employee's social insurance number. Therefore, in principle, if the company has fully paid social insurance contributions, the employee's rights will not automatically be lost simply because the company goes bankrupt.
In reality, the biggest difficulty is not the "loss of social insurance money," but the incomplete paperwork before the business ceases operations.
There are many cases where companies still owe social insurance contributions, have not confirmed their social insurance participation history, or have not completed the procedures for closing the social insurance account for employees before dissolution or bankruptcy. In such cases, employees may face difficulties when applying for a lump-sum social insurance payment. Some only have their employment contract or payslip but no longer have their social insurance book, do not know their social insurance number, or are unsure of the company's contribution history. This makes the verification process with the social insurance agency more time-consuming.
However, in many cases, the social insurance agency can still check the employee's social insurance participation data on the system to assist in processing the application if previous insurance contribution information is still available.
According to current regulations, foreign workers subject to mandatory social insurance participation may be eligible for a lump-sum social insurance payment in certain cases, including termination of employment contracts and no longer residing or working in Vietnam as stipulated by law. It is important for employees to demonstrate their social insurance participation history and meet the eligibility requirements at the time of application.
This means that a company's bankruptcy does not automatically void the right to claim a lump-sum social insurance benefit if the employee still has complete records and data on social insurance participation. However, the actual processing time may be longer if the company's records are incomplete or if the company has outstanding social insurance obligations before ceasing operations.
In reality, many foreign workers don't realize that social insurance in Vietnam is an important financial benefit until they are preparing to return home or are reminded by friends.
There are cases where people only start looking into withdrawing social insurance after several years of leaving their jobs. By then, personal records may be lost, the company may no longer be operating, or the former HR manager may have left long ago. This is why reviewing social insurance status immediately after leaving a job is often very important, especially for foreign workers preparing to leave Vietnam or whose employment contracts have ended.
A company's bankruptcy in Vietnam does not automatically mean that foreign workers lose all their social insurance benefits. However, if the company has not finalized its records, still owes social insurance contributions, or has suddenly ceased operations, the processing of documents can become much more complicated than in typical cases. In cases involving company dissolution, loss of contact with the business, or the need to process social insurance from abroad, DEDICA assists in reviewing documents, working with social insurance agencies, and advising on appropriate solutions based on each worker's specific situation.
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