Question 106. Is an Employee who works under a LC of less than 03-month period subject to participation in the compulsory SI?


  1. Concluding a LC of less than 03-month period with an Employee

Pursuant to the Labour Code, a LC of less than 3-month period may be classified as a definite-term LC[1] since the Labour Code removed the type of a seasonal LC or a specific-task LC of less than 12-month period. Accordingly, when signing a LC of less than 03-month period, an Employer is required to conclude a definite-term Ls, a type of LC in which parties agree on the term and time of termination.

There are actually many cases where an Employer and a part-time Employee signed a “freelance contract”. However, when a competent labour management agency inspected at their premises, it turned out that the Employee had worked “continuously” and “frequently” for the said Employer for many years under “freelance contracts”, and under such a circumstance, the Employer was required to sign a LC with the said Employee.

2. Is a part-time Employee subject to the compulsory SI?

Pursuant to the Law on SI, an Employee working under a LC with the period of full 01 month to less than 03 months is subject to the compulsory SI[2]. Therefore, if an Employer sign a LC of less than 3-month period with an Employee, the Employer must pay the SI premiums for the Employees.

[1] Article 20.1(c) of the Labour Code

[2] Article 2.1(b) of Law on SI