social security is a system of social protection for its members through a series of public measures, aimed at combating the economic and social hardship that otherwise would be caused by the stoppage or substantial reduction of earnings resulting from sickness, maternity, employment injury, unemployment, invalidity, old age and death; ensuring medical care and providing benefits for families with children. According to the ILO, the social security system includes 9 regimes as follows: medical care, sickness benefit, unemployment benefit, old age benefit, employment injury benefit, occupational disease benefit, family benefit, maternity benefit, invalidity benefit, and death benefit.
In Vietnam, many scholars and managers also give different broad and narrow definitions of social security. Author Hoang Chi Bao defines social security in a very broad sense, which is the safety of human life, from individuals to communities, creating the premise and motivation for human and social development. Social security is the guarantee for humans to exist (live) as humans and develop the strengths of human nature, that is, humanity in its activities, in its real life as a subject with personality 2. Nguyen Hai Huu approaches social security from a policy perspective.
In a broad sense, close to the ILO definition, it is a system of mechanisms, policies, and measures of the State and society to help all members of society cope with risks and socio-economic shocks that put them at risk of decline or loss of income due to illness, maternity, accidents, occupational diseases, old age, loss of working capacity, or other objective reasons, falling into poverty, and providing health services to the community, through the network system of social insurance, health insurance, and social assistance" [11].
Mai Ngoc Cuong believes that, to fully understand the nature of social security, we must approach it in both the broad and narrow sense of this concept. In the broad sense : social security is the guarantee of the implementation of rights so that people can be at peace, and ensure security and safety in society . In the narrow sense: social security is the guarantee of income and some other essential conditions for individuals, families and communities when their income is reduced or lost due to their reduced or lost ability to work or loss of jobs; for lonely elderly people, orphans, disabled people, the disadvantaged, and people affected by natural disasters and war [06].
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2 Proceedings of Scientific Conference Topic KX02.02/06-10
Although, with different expressions, the concepts of social security have the following common points [12]:
(1) Ensuring minimum income security through a system of intervention policies to better manage risks such as health risks, unemployment or underemployment, old age, children, disability, etc. leading to temporary or permanent lack of income compared to the minimum living level.
(2) The State plays a major role in developing and implementing social security policies. In addition, social organizations, communities and the market also participate in organizing, implementing and providing social security services.
(3) The safety net for all members of society should aim to cover the entire population, ensuring that all members of society, including the disadvantaged, have equal access to and quality of services (this is also the reason for the state to participate in social security policy).
A national social security system is always structured with three basic elements:
First: Risk prevention policies
This is the top layer of the social security system, playing the role of intervening and covering the entire population to ensure that everyone has a job and income to support themselves and their families, with the most basic pillars being active labor market policies such as vocational training; supporting job seekers, self-employment or training to improve skills for workers.
Second: Risk mitigation policies
This is the second layer of the social insurance system to minimize damage caused by risks with insurance forms based on the contribution-benefit principle such as: social insurance, health insurance, unemployment insurance, etc.
Third: Risk mitigation policies
This is the last layer of the social security system to protect the safety of members of society when they encounter risks that they cannot overcome themselves, such as: the elderly without pensions, the disabled, orphans, the poor, people affected by natural disasters... Policies at this layer include social relief and social assistance.
2.1.2. Concept of social insurance, compulsory social insurance, voluntary social insurance
Social insurance was born and developed since the industrial revolution appeared in Europe, to ensure the lives of industrial workers and their families against social risks such as illness, accidents, job loss, etc., reducing or losing income. In all countries, social insurance policy is considered a basic and most important pillar in the social security system.
There are many different approaches to social insurance, for example [03]:
From other perspectives, there can also be different concepts of social insurance [03], for example:
- From a legal perspective : Social insurance is a legal institution that protects workers, uses contributions from workers and employers, and is sponsored and protected by the State, to provide material support to the insured and their families in case of reduced or lost normal income due to illness, work accidents, maternity, reaching the legal retirement age (retirement) or death.
- From a financial perspective : Social insurance is the sharing of financial risks among social insurance participants according to the provisions of law.
- From the perspective of social policy : Social insurance is a social policy to ensure the material life of workers when they encounter "social risks to contribute to ensuring social security....
Currently, the Law on Social Insurance (2014) stipulates: Social insurance is a guarantee to replace or partially compensate employees' income when they have reduced or lost income due to illness, maternity, work accidents, occupational diseases, retirement age or death , based on contributions to the Social Insurance Fund.
Social insurance policy is mainly composed of 2 policies:
- Compulsory social insurance is a type of social insurance organized by the State in which, according to the law, employees and employers must participate, applied to the formal economic sector, with labor relations, mainly for enterprises, organizations, and economic units.
- Voluntary social insurance is a type of social insurance organized by the State in which employees (mainly working in the informal economic sector, without labor relations) can choose the contribution level and payment method suitable to their income.
income and the State has a policy to support social insurance contributions so that participants can enjoy social insurance benefits.
The Law on Social Insurance (2014) also stipulates that compulsory social insurance includes the following regimes: sickness; maternity; work accidents, occupational diseases; retirement; death benefits; and voluntary social insurance has only 02 regimes: retirement; death benefits.
Comparing social insurance and other types of commercial insurance, there are basic differences such as:
First, the biggest difference is in the purpose: Social insurance is a non-profit insurance type, while commercial insurance aims to make a profit. Thus, the profit of life insurance is taken from the money of the commercial insurance participants.
Second, regarding conditions and participation fees: Social insurance participants are Vietnamese citizens aged 15 and over who are not subject to compulsory social insurance with a predetermined contribution rate of 22% to the pension and death fund. However, for life insurance, due to the nature of profit, participation conditions are often quite strict regarding age and health at the time of signing the insurance contract to minimize financial risks.
Third, regarding benefits: The amount paid into the social insurance fund is adjusted to increase in accordance with the annual consumer price index (CPI) according to the Government's regulations announced in the year in which the participant receives the regime (the CPI index increases by an average of 8.1%/year, from 2008 to present). As for life insurance, it is calculated according to the market interest rate. When participants in social insurance receive a pension, the pension level is periodically adjusted according to the consumer price index and economic growth. In fact, the State adjusts the pension almost every year, and in the period from 2003 to present, the Government has adjusted the pension many times with an increase of about 7.5 to 9.3 times (depending on the target group) compared to the pension level in 2002. This is an outstanding advantage of social insurance. For commercial insurance, the benefits are enjoyed according to the signed contract. In addition, in case of risk that the insurance company goes bankrupt, the participant may lose all benefits. On the contrary, when participating in social insurance, the participant's benefits are absolutely guaranteed because the social insurance fund is protected by the State and will not go bankrupt;
If the state is unable to pay, it will allocate funds from the budget to ensure the social security rights of the people.
2.1.3. Concept of enterprise, non-state enterprise
An enterprise is defined as an economic unit that performs independent economic accounting, has full legal status, is established under the Enterprise Law, Investment Law (Foreign Direct Investment Law), or under an Agreement signed between the Vietnamese Government and a foreign government, including the following types of enterprises:
State-owned enterprises include the following types of enterprises: (1) 100% state-owned enterprises operating under central and local management; (2) state-owned limited liability companies under central and local management;
(3) Domestic joint stock companies in which the State holds more than 50% of the charter capital.
Foreign-invested enterprises are enterprises regardless of the proportion of capital contributed by foreign parties, including 2 types: (1) 100% foreign-owned enterprises; (2) joint venture enterprises between foreign and domestic partners.
Non-state enterprises include domestic capital enterprises that are privately owned by one or a group of people with state ownership but accounting for 50% or less of the charter capital. The non-state enterprise sector includes: (1) private enterprises; (2) partnerships; (3) private limited liability companies; (4) joint stock companies without state capital; (5) joint stock companies with state capital of 50% or less of the charter capital [39].
In this thesis, we only focus on examining the type of non-state enterprises, which have many issues to consider regarding social insurance policies for employees.
2.1.4. Concept of workers, workers participating in compulsory social insurance The concept of "Worker" is a "general noun used to refer to all wage earners" who use their labor or mind to create material or spiritual products for others, working in many fields and professions.
different in society
The Labor Code (2012) of Vietnam explains the concept of “A worker is a person aged 15 years or older, capable of working, working under a labor contract, receiving wages and being managed and directed by an employer” (Clause 1, Article 3). The Law on Employment (2013) explains the concept of “A worker is a person who is
Vietnamese citizens aged 15 years or older, capable of working and in need of work (Clause 1, Article 3). Thus, the two laws define this concept differently. The Law on Employment defines the concept of workers more broadly, including workers working in the formal and informal sectors, with or without labor relations; the Labor Code only applies to workers in the sector with labor relations, so the concept of workers is associated with a specific labor relationship, that is, there is a labor contract signed between the worker and the employer. The thesis uses the concept of workers according to the provisions of the Labor Code because they are working in an enterprise, associated with a specific labor relationship.
The Social Insurance Law (2014) stipulates that all employees have the right to participate in social insurance. For the compulsory social insurance policy , the participants include 10 groups of subjects:
(1) Persons working under indefinite-term labor contracts, fixed-term labor contracts, seasonal labor contracts or contracts for a specific job with a term from 3 months to less than 12 months, including labor contracts signed between the employer and the legal representative of a person under 15 years of age in accordance with the provisions of labor law;
(2) Employees working under a fixed-term labor contract from 01 month to less than 03 months (effective from 01/01/2018);
(3) Cadres, civil servants, public employees;
(4) Defense workers, police workers, and people working in other key organizations;
(5) Officers and professional soldiers of the people's army; officers and professional non-commissioned officers; officers and technical non-commissioned officers of the people's police; and people doing cryptographic work receiving salaries as soldiers;
(6) Non-commissioned officers and soldiers of the people's army; non-commissioned officers and soldiers of the people's police on temporary duty; military, police and cryptographic students currently studying are entitled to living expenses;
(7) People working abroad under contracts as prescribed in the Law on Vietnamese workers working abroad under contracts;
(8) Business managers and cooperative executives receive salaries;
(9) Non-professional workers in communes, wards and towns.
(10) Foreign employees working in Vietnam with a work permit or practice certificate or practice license issued by a competent authority of Vietnam are eligible to participate in compulsory social insurance according to Government regulations.
Thus, employees participating in compulsory social insurance in enterprises include 3 groups of subjects:
- People working under indefinite-term labor contracts, fixed-term labor contracts, seasonal labor contracts or contracts for a specific job with a term from 3 months to less than 12 months, including labor contracts signed between employers and legal representatives of people under 15 years old according to the provisions of labor law;
- Employees working under labor contracts with a term of 01 month to less than 03 months (this policy will be implemented from January 1, 2018);
- Foreign employees working in Vietnam with a work permit or practice certificate or practice license issued by a competent authority of Vietnam are eligible to participate in compulsory social insurance according to Government regulations (accounting for only a very small percentage).
The Law on Social Insurance (2014) also stipulates that employees participating in voluntary social insurance are Vietnamese citizens aged 15 years or older and are not subject to compulsory social insurance, including: People participating in production, business and service activities, including members who do not receive salaries or wages in cooperatives and cooperative unions.
2.2. Theoretical approaches to the topic
2.2.1. Role theory
The topic also uses the role-status theory of Ralph Linton (1893-1953), who was the first to determine the sociological content of the concepts of status and role. According to Linton, status is understood in two senses: in an abstract sense, status is a position in a certain interaction pattern, meaning that a group of people has many positions due to participating in many behavioral patterns. In a concrete sense, a person's status is the set of all positions that he or she holds in interactions.
social interaction. Because position is understood in two senses, role is also understood in two similar senses. A person's role is the synthesis of the roles that person performs, thanks to which a person's role will determine what that person does for society and what can be expected from society [14]. In labor relations, the employee is an employee, a hired worker for the employer, so he is dependent and weaker than the employer, therefore, the employee's participation in social insurance is also influenced by his social position in labor relations.
Second, Parsons' role system theory explains that social roles form a social system in which any change in one role will lead to changes in other roles and the entire system [14]. Vietnamese society is being comprehensively renovated in which the economy is shifting to a market economy. Therefore, the role and position of workers and employers are also changing accordingly. Workers are playing a much more active and proactive role than in the early stages of the renovation period or the subsidy period to suit the innovation of labor relations, of the state, workers and enterprises in the entire Vietnamese socio-economic system in the context of globalization and world economic integration.
Third, Merton's role-set theory explains that there are roles that are synthetic, collective, dominant, and cover other roles. Workers perform many different roles, but the role of an employee or worker will be dominant, dominating the roles of citizen and union member in labor relations and social insurance [14]. It is necessary to apply Merton's theory to analyze the set of roles of workers to see the specificity of labor relations, thereby accurately assessing the factors that control and affect workers' behavior of participating in social insurance.
2.2.2. Theory of rational choice
Sociologists such as George Homans, Peter Blau, James Coleman... show that people always act intentionally, thoughtfully to choose and use resources rationally to achieve maximum results with minimum costs. According to Weber, the most important characteristic of modern society is that human actions become increasingly rational with detailed, meticulous and precise calculations between goals and results. The real thesis is always the fulcrum for economists. The