EARLY RETIREMENT BEFORE STATUTORY AGE FOR LABOR

Early retirement before the statutory age is one of the key policies that allows Labors to retire earlier while still securing financial benefits and social insurance entitlements. According to Decree No. 178/2024/NĐ-CP, individuals eligible for early retirement will receive special allowances depending on their years of early retirement and the duration of compulsory social insurance contributions. This policy not only provides economic support but also contributes to stabilizing the lives of workers after leaving the labor market.

In this article, LawPlus will provide a detailed overview of early retirement entitlements, applicable conditions, and allowance levels under the latest regulations.

1. Eligible Subjects for Early Retirement Regime

Early Retirement for Employees

According to Decree No. 177/2024/NĐ-CP, the following individuals may retire before the statutory age upon request:

• Officials holding tenure-based positions or titles in the Party, State, Vietnam Fatherland Front, and socio-political organizations from the commune level to the central level, who are ineligible for re-election or re-appointment to the same Party committee. Even if eligible for re-election to the Party committee but ineligible to continue holding positions in government, the Fatherland Front, or socio-political organizations, they still qualify.

• Officers, professional army personnel, national defense officials, and cipher staff in the Army or Police holding positions in Party committees or inspection committees who are ineligible for re-election. Retirement age follows laws applicable to military, police, or cipher sectors.

• Civil servants appointed to term-based positions within the Party committee structure who are ineligible for re-election. This includes Chairpersons and Vice Chairpersons of People’s Committees in urban districts, towns, and wards with urban governance, as well as Heads of commune-level military commands.

• Those in the above groups who are eligible for re-election or re-appointment but have between 30 to 60 months of service remaining (calculated from the date of the congress) until reaching retirement age, and wish to retire early due to personnel restructuring, with approval from competent authorities.

• Officials under the management of the Politburo or the Party Central Secretariat permitted to retire under Notification No. 20-TB/KL-2022.

Ineligible Cases:

• Subjects under downsizing policies.

• Those who already have a retirement decision or have less than 6 months of service remaining before retirement.

• Persons ineligible for re-election or re-appointment but who continue working in Party, State, or socio-political organizations.

According to the 2008 Law on Cadres and Civil Servants:

• A cadre is a Vietnamese citizen elected or appointed to a tenure-based position in a Party, State, or socio-political organization from the district level upward, and paid from the state budget.

• Commune-level cadres are elected to positions in the People’s Council, People’s Committee, Party Committee, or local socio-political organizations.

• Commune-level civil servants hold professional positions in the commune-level People’s Committee and are paid from the state budget.

2. Conditions for Early Retirement for Labor

Employees may retire earlier than the statutory retirement age if they meet compulsory social insurance contribution requirements and fall into one of the following categories:

Early Retirement of Up to 5 Years

Employees may retire up to 5 years earlier than the statutory retirement age if they have contributed to compulsory social insurance for at least 20 years and meet one of the following:

• At least 15 years working in hazardous, toxic, dangerous, or especially hazardous conditions as listed by the Ministry of Labour, Invalids, and Social Affairs.

• At least 15 years working in areas with extremely difficult socio-economic conditions, including areas with a regional allowance coefficient of 0.7 or higher prior to January 1, 2021.

• A total of at least 15 years in hazardous conditions and/or difficult regions.

• A work capacity reduction of 61% or more.

Early Retirement of Up to 10 Years

Employees may retire up to 10 years earlier if they meet the following:

• At least 20 years of compulsory social insurance contributions; and

• Either:

  • At least 15 years working in underground coal mining; or

  • A work capacity reduction of 81% or more.

Retirement with No Age Limit

Employees may retire regardless of age if they meet both conditions:

• At least 20 years of compulsory social insurance contributions; and

• One of the following:

  • Infected with HIV/AIDS due to occupational risk;

  • Work capacity reduced by 61% or more and at least 15 years in particularly hazardous, toxic, dangerous jobs as classified by the Ministry of Labour, Invalids, and Social Affairs.

3. Benefits under the Early Retirement Policy

Pursuant to Article 7 of Decree No. 178/2024/NĐ-CP, early retirees are entitled to the following benefits:

Lump-Sum Retirement Allowance

Persons defined in Clause 1, Article 2 of this Decree who retire early will receive a lump-sum allowance based on the time of early retirement:

• Within the first 12 months after the organizational restructuring decision:

  • If less than or equal to 5 years from retirement age (as per Appendices I and II of Decree No. 135/2020/NĐ-CP), the allowance equals 1 month of current salary per each month of early retirement.

  • If more than 5 years but less than or equal to 10 years, the allowance equals 0.9 month of current salary multiplied by 60 months.

• From the 13th month onward, the allowance is 50% of the amount specified in the first 12 months.

Pension Scheme Based on Years of Early Retirement

Labors contributing to compulsory social insurance will receive retirement benefits based on the number of early retirement years:

• Retiring 2 to 5 years earlier:

  • No reduction in pension rate.

  • Receive a lump-sum of 5 months of current salary for each year of early retirement.

  • Receive 5 months’ salary for the first 20 working years, and 0.5 month for each additional year from the 21st year onward.

• Retiring more than 5 to 10 years earlier:

  • No pension rate reduction.

  • Receive a lump-sum of 4 months of current salary per each year of early retirement.

  • The same additional service-based benefit as above.

• Working in hazardous environments or difficult areas:

  • If retiring 2–5 years before statutory age per Appendix II, with at least 15 years in hazardous/difficult conditions, the same policies apply (no pension reduction, same lump-sum benefits).

• Less than 2 years from retirement age:

  • No pension reduction if the employee has sufficient social insurance contributions.

  • Workers in hazardous occupations or regions receive similar benefits.

Commendation Policy Upon Early Retirement

Officials, public employees, and civil servants retiring early per Clause 1 and 2, Article 7 of the Decree are eligible for commendation under the 2022 Law on Emulation and Commendation:

• If missing tenure for award eligibility, early retirement duration will be credited accordingly.

• If not eligible for commendation based on service contribution, competent authorities may consider other appropriate forms of recognition.

Early retirement policies offer substantial benefits for long-serving Labors and those working in difficult or hazardous environments.

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