Caught in a lawsuit against a company that owes social insurance

(Baonghean) - Implementing the Social Insurance Law 2014, from January 1, 2016, the right to sue units with outstanding social insurance debts has been assigned to trade unions. However, up to now, after more than 1 year of implementation, there has not been any successful lawsuit in the whole province.

Long-term debt pain

Sharing the same situation as many provinces and cities across the country, in Nghe An, the situation of social insurance debt is becoming more and more complicated, affecting the rights of thousands of workers. Up to now, the total social insurance debt in the province is more than 300 billion VND, in which many units have large debts for a long time, the recovery has been dragging on for many years and has not been completed.

“Naming and shaming” the units with long-standing debts shows that most of them are non-state-owned units operating in the fields of construction and transportation. Among them, many social insurance units have determined that they have “done everything”, and the only last resort is to file a lawsuit. Some units at the “top of the list” with long-standing debts include Construction Investment Joint Stock Company 24 with 53 employees, with social insurance arrears of up to 16 billion 360 million VND; Irrigation Construction Joint Stock Company 1 with 77 employees, with a debt of 6 billion 137 million VND… In addition, many small and medium-sized enterprises with 15, 20 employees or more are owing social insurance of around 1 billion VND.

Procedure for suing businesses for social insurance arrears.

According to the assessment, there are currently 3 forms of social insurance debt that affect the rights of employees: the case where the employee is owed the entire amount by the enterprise and is not entitled to the social insurance policy at all; the enterprise is doing well but deliberately delays paying social insurance for the employee; a part of the enterprise is really in difficulty and is unable to pay. The reason for the social insurance debt of enterprises is due to the difficult socio-economic situation; many units have actually stopped operating but have not reported the reduction to the social insurance agency, leading to the virtual debt increasing every month, affecting the rights and legitimate interests of the employee.

In addition, non-state enterprises in the province are mainly small and medium-sized, operating as household businesses, operating unstable, most of them do not have specialized staff in social insurance work, so their understanding of the Law on Social Insurance and Health Insurance is limited; business owners do not care about the rights of employees.

Faced with that reality, the provincial Social Insurance has coordinated with the Provincial Labor Federation to conduct the documents and procedures for filing a lawsuit - the final solution to recover outstanding debts. According to statistics from the provincial Social Insurance, in 2016, the Social Insurance transferred a list of 75 units with long-term outstanding debts that had been issued a penalty decision by the Chief Inspector of the Department of Labor, Invalids and Social Affairs in 2015 to the Provincial Labor Federation for lawsuit. Accumulated to May 2017, the provincial Social Insurance agency has prepared documents requesting the Provincial Labor Federation to file a lawsuit against 48 units, with a total debt of more than 50 billion 300 million VND. However, even when mentioning the option of "filing a lawsuit", the whole province has only been able to reconcile 1 unit, VENTURE Joint Stock Company (Thanh Chuong) and 1 debt recovery unit, the Livestock Breeding Center. As for the rest, information from the Provincial Labor Federation said that, up to this point, the Federation has sent 14 sets of documents to sue businesses that owe social insurance to the court but is still in the process of having to supplement more information.

Although it is considered quite active in exercising the right to sue, trade unions are facing many difficulties, above all, the overlap and gaps in legal regulations have invisibly created challenging "barriers". In order for trade unions to file a lawsuit and have it accepted by the court, it is necessary to base it on the Civil Procedure Code, but the Social Insurance Law took effect from January 1, 2016, and the Civil Procedure Law will only take effect from July 1, 2016. On the other hand, the Penal Code took effect from July 1, 2016, but must be temporarily suspended to wait for the upcoming National Assembly session to give opinions. In addition, the Vietnam General Confederation of Labor and the Supreme People's Court have not yet issued specific guidance documents for suing enterprises with social insurance arrears.

Previously, when the right to sue was in the hands of the Social Insurance Agency, it was only necessary to rely on the amount of debt and the time of debt, but when the trade union organization sued a business that owed social insurance, it needed to be authorized by the employees and organize mediation work. However, mediation work is very difficult to carry out. In addition, according to regulations, to sue a business that owed social insurance, the grassroots trade union must initiate the lawsuit or authorize the direct superior trade union. However, in Nghe An, there are currently a number of small and micro enterprises that do not have a grassroots trade union organization, so it is impossible to authorize the grassroots trade union to sue the business in court. Another "sensitive" reason is that grassroots trade union officials are still directly receiving salaries from the business owner, so filing a lawsuit is difficult.

Hope for the revised Penal Code

Discussing solutions to remove obstacles in the process of exercising the right to sue enterprises with social insurance arrears, Mr. Nguyen Chi Cong - Head of the Legal Policy Department, Provincial Labor Federation said that both the Federation and the Social Insurance sector are placing high hopes on the revised 2015 Penal Code with many new points. Notably, Article 216 of the 2015 Penal Code stipulates the crime of evading social insurance payments for employees, violators can be fined up to 3 billion VND, imprisoned for up to 7 years. Currently, the revised Penal Code is waiting to be passed at the 3rd session of the 14th National Assembly. Once the Code is passed and comes into effect, it will create more effective deterrence for many employers who are evading social insurance payments and arrears.

However, while waiting for legal solutions, first of all, the Labor Federation and the Social Insurance sector are still urgently looking for solutions for each specific lawsuit. Mr. Ngo Ngoc Thanh - Head of Debt Exploitation and Collection Department, Provincial Social Insurance, said that the Provincial Social Insurance and the Provincial Labor Federation have signed a coordination program on exchanging, providing information, documents, and experience in filing lawsuits in Court for violations of the law on Social Insurance, Health Insurance, and Unemployment Insurance; coordinating to participate in litigation at People's Courts at all levels. Along with that, the Social Insurance sector recommends that the Provincial People's Committee direct the Court and the Enforcement Agency to promptly file lawsuits and enforce judgments against units that owe Social Insurance, ensuring the rights of employees.

In order for suing enterprises with social insurance arrears to become an effective solution to overcome and limit the situation of social insurance arrears, it is necessary to focus on improving the qualifications, capacity, and legal knowledge of lawsuits and litigation in court of union officials; the social insurance sector needs to step up inspection and examination of enterprises' implementation of the law on social insurance, minimizing the situation of enterprises with social insurance arrears. With the viewpoint of "wherever there is a problem, there is a solution", determined to collect social insurance to ensure the rights of workers, hopefully in the coming time, the cooperation between the social insurance sector and the Provincial Labor Federation will bring many practical results.

Phuoc Anh