Recently, Lawyer Nguyen Thi Ngoc Anh – Director and Managing Partner of ATA Legal Services – shared insights with reporters from Vietnam Law Journal on the new regulations under the Social Insurance Law (SIL) 2024 and Decree No. 274/2025/ND-CP, particularly regarding the clear identification of the transition point from “late payment” to “evasion” of social insurance (SI) contributions, as well as the increased penalties for SI evasion, which have put significant pressure on many enterprises at this time.
The full interview was published in the Enterprise and Integration Online Magazine under the title: Chuẩn hóa hành vi tuân thủ pháp luật của doanh nghiệp trong việc đóng bảo hiểm xã hội
ATA has also updated the key highlights of Decree No. 274/2025/ND-CP guiding the implementation of several provisions of the Social Insurance Law. Readers can refer to the following article:
DECREE NO. 274/2025/NĐ-CP: TIME TO DETERMINE ACTS OF EVASION OF COMPULSORY SOCIAL INSURANCE AND UNEMPLOYMENT INSURANCE CONTRIBUTIONS
Below, ATA Legal Services is pleased to publish the full article on this topic:
According to Lawyer Nguyen Thi Ngoc Anh – Director of ATA Legal Services, Decree No. 274/2025/ND-CP (Decree 274) guiding the implementation of several provisions of the Social Insurance Law clarifies and provides procedures for identifying and handling acts of late payment or evasion of social insurance (SI), health insurance (HI), and unemployment insurance (UI) – collectively referred to as mandatory insurance (MI) for employees. Compared to the previously vague references to “debts, late payments, or evasion,” Decree 274 explicitly defines and provides measurable criteria to distinguish between “late payment” and “evasion,” marking a significant step forward in legislation and supporting state management of MI for employees. “The breakthrough of Decree 274 lies in establishing a ‘clear legal boundary’ between the act of ‘late payment of MI for employees’ and the act of ‘evasion of MI for employees’,” emphasized Lawyer Nguyen Thi Ngoc Anh.
Lawyer Nguyen Thi Ngoc Anh further explained that an enterprise (DN) shall be determined to have committed MI evasion if two elements are met:
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Intentional element: The act is deliberate, involving concealment or misappropriation of obligations; and
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Time element: Exceeding the legally prescribed deadline.
According to Decree 274, except for acts such as failure to declare, failure to submit participation documents, or intentionally declaring a lower contribution amount, in cases of time-based late payments, the social insurance agency will send notifications to inform, allow remediation, or request explanations from enterprises. This mechanism serves as an early warning system, enhancing transparency and enabling enterprises to clearly identify legal boundaries and make timely adjustments.
Assessing the positive impact of these regulations, Dr. Pham Ngoc Lang – Deputy Director of the Institute of Business Intelligence – commented that the clarification of the boundary between “late payment” and “evasion” in the SIL 2024 and its guiding documents is both necessary and progressive. Specifically, this provision enhances transparency and objectivity, helping to distinguish between enterprises genuinely facing cash flow difficulties (leading to late payment) and those deliberately delaying or misappropriating funds (evasion). “This not only protects employees’ legitimate rights but also fosters a fairer business environment – where law-abiding enterprises are not unfairly disadvantaged by those intentionally violating the law,” affirmed Dr. Lang.
Faced with the new, stricter penalties and the risk of criminal prosecution for SI evasion, many enterprises have expressed concern. Some have proactively reviewed records and promptly settled outstanding debts, while many small and micro enterprises have reported difficulties balancing revenues and expenses, especially amid declining orders and revenues. Concurrently, certain “loophole tactics” have emerged, such as signing seasonal contracts, outsourcing labor, or converting employees into collaborators to reduce SI obligations.
Dr. Pham Ngoc Lang further noted that, amid ongoing economic challenges, tighter management requires enterprises to be more meticulous in financial governance. However, for businesses that prioritize compliance as a core value, such regulations serve as pressure “to do right and do better,” not merely “to cope.” “Compliance with SI obligations should not stem from fear of administrative or criminal sanctions, but from a fundamental responsibility toward employees – the very people who accompany the business,” Dr. Lang stated.
To ensure employee rights, enterprises have implemented several measures, including:
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Prioritizing cash flow: Enterprises allocate funds first to payroll and MI (SI, HI, UI) contributions, viewing these as mandatory expenses comparable to payments to strategic suppliers.
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Standardizing internal processes: Establishing clear coordination between HR (calculation, reconciliation) and accounting (payment execution) departments to ensure data accuracy and on-time payments, minimizing technical errors.
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Enhancing transparency and dialogue: Disclosing SI contribution information via internal channels (email, notice boards) so employees can verify and monitor their accounts. Some even train staff to calculate contributions independently. When difficulties arise, enterprises engage in open dialogue with employees to find solutions.
In addition to these measures, Lawyer Nguyen Thi Ngoc Anh recommends that enterprises shift from a “reactive” to a “proactive prevention” mindset through the following actions:
1. Review employee lists subject to MI participation, avoiding omissions or under-declarations. This issue rarely occurs in large enterprises but is frequent among small and medium-sized ones.
2. Assign staff to monitor regulatory updates and communications from authorities, promptly addressing omissions or errors. Typically, authorities may send reminders (by official letter or registered email) urging payment of MI within the first 10 days of each month. Enterprises must pay close attention to avoid missing such notifications. Upon receiving reminders or identifying delays, enterprises should proactively submit written explanations to authorities.
3. Conduct legal audits and compliance consultations. For large enterprises with numerous employees, hiring advisory firms to review or provide regular compliance consulting on SI records, contracts, payroll, and internal employee benefits regulations is increasingly essential. This approach enables early detection of errors or legal risks, preventing back payments or criminal liability for administrative mistakes. In today’s stricter legal environment, compliance auditing and legal consulting should be viewed not as expenses, but as investments in legal safety.
“In my view, the new regulations are not designed to increase penalties, but to standardize compliance behavior. In the short term, enterprises – particularly those struggling with cash flow – may feel financial and administrative pressure to ensure timely and full payments. However, in the long term, these regulations will foster a fairer competitive environment among businesses,” concluded Lawyer Nguyen Thi Ngoc Anh.
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