EVALUATING THE IMPLEMENTATIONOF UNEMPLOYMENT INSURANCEIN THAI NGUYEN PROVINCE _ A DISSERTATION Presented to the Faculty of the Graduate School Southern Luzon State University, Lucban, Quezon, Philippines in Collaboration with Thai Nguyen University, Socialist Republic of Vietnam _ In Partial Fulfilment of the Requirements for the Degree Doctor of Business Administration _ By PHUNG THI CAM CHAU (ROSE) December 2013 i APPROVAL SHEET The Dissertation of PHUNG THI CAM CHAU entitled EVALUATING THE IMPLEMENTATION OF UNEMPLOYMENT INSURANCE IN THAI NGUYEN PROVINCE Submitted in Partial Fulfilment of the Requirements for the Degree DOCTOR OF BUSINESS ADMINISTRATION A program jointly offered by Southern Luzon State University, Republic of the Philippines and Thai Nguyen University, Socialist Republic of Vietnam has been approved by Oral Examination Committee WALBERTO A MACARAAN, Ed.D Expert CONRADO L ABRAHAM, Ph.D Expert MELCHOL MELO O PLACINO, Ph.D Expert TRAN DAI NGHIA, Ph D External Panel CECILIA N GASCON,Ph.D Chairman Endorsed by: Recommended by: DO ANH TAI, Ph.D Adviser APOLONIA A ESPINOSA, Ph.D Dean Accepted in Partial Fulfilment of the Requirements for the Degree Doctor of Business Administration _ Date WALBERTO A MACARAAN, Ed.D Vice President for Academic Affairs ii CERTIFICATE OF ORIGINALITY iii ACKNOWLEDGMENT I would like to extend my sincere thanks to Thai Nguyen University (Vietnam), International training center (Thai Nguyen University, College of Agricultural and Forestry), Southern Luzon State University (Philippines) for having organized this doctorate training course in business administration training, which I have found to be a valuable opportunity for me to further upgrade my knowledge and capacity I feel grateful for my lecturers who have provided their students with their great knowledge and guidance throughout the course I am indebted to the administrators of Thai Nguyen College of Economics and Finance, andVietnam Trade Union University for their facilitation of my attendance to this course I owe my deep gratitude to Assoc Prof Dr Do Anh Tai, my supervisor and instructor, for his kind instructions and valuable remarks towards my completion of this thesis I would also like to say thanks to my relatives, friends and colleagues Without their donations of materials, data processing, and translation, this thesis would not have been made possible I am indebted to many other people They are writers of useful materials in books, internet, and newspapers And finally, my big thanks to my family whose encouragement and support have always been with me from the beginning to completion of this thesis iv DEDICATION I would like to dedicate this work to my parents, teachers, relatives, colleagues and friends - who have been standing by my side, giving me support in life My first expression of gratitude comes to my parents who I own this life to and who have been wholeheartedly supporting and facilitating me towards my achievements I am profoundly grateful to my teachers for their thoughtfulness and dedication My passion to sciences could not have growth without them I sincerely thank my relatives, friends and colleagues who have been around with their cheers and encouragements Thank you all! PhungThi Cam Chau v TABLE OF CONTENTS PAGE TITLE PAGE ……………………………………………………………… i APPROVAL SHEET ……………………………………………………… ii CERTIFICATE OF ORIGINALITY ……………………………………… iii ACKNOWLEDGEMENT ………………………………………………… iv DEDICATION ……………………………………………………………… v TABLE OF CONTENTS ………………………………………………… vi LIST OF TABLES ………………………………………………………… viii LIST OF FIGURES ……………………………………………………… ix LIST OF APPENDICES ………………………………………………… x ABSTRACT ………………………………………………………………… xi CHAPTER I II III INTRODUCTION Introduction ………………………………………………… Background of the Study ………………………………… Statement of the Problem ………………………………… Significance of the Study ………………………………… Scope and Limitation of the Study ……………………… Definition of Terms ………………………………………… REVIEW OF LITERATURE ……………………………… 12 Conceptual Framework ………………………….………… 35 METHODOLOGY Local of the Study ………………………………………… 37 Research Design …………………………………………… 41 Population and Sampling ……….………………………… 41 Research Instrumentation … … …………………….… 42 Validation of the Instrument ……………………………… 43 Data Gathering Procedure ………………………………… 43 Data Processing Method ………………………………… 45 vi Statistical Treatment ……………………………………… 45 IV RESULTS AND DISCUSSIONS ………………………… 47 V SUMMARY, CONCLUSION AND RECOMMENDATION Summary of Findings ……………………………………… 82 Conclusions ………………………………………………… 89 Recommendations ………………………………………… 91 REFERENCES …………………………………………………………… 97 APPENDICES …………………………………………………………… 100 CURRICULUM VITAE …………………………………………………… 107 vii LIST OF TABLES TABLE PAGE Profile of Respondents ……………………………………… 48 Respondents’ Perceptions on Implementation of UI in Thai Nguyen Province in Terms of Coverage of UI …………… 57 Implementation of UI in Thai Nguyen Province in Terms of Coverage of UIBased on the Evaluation of the Respondents have been Grouped ………………………… 58 Respondents’ Perception on Implementation of UI in Thai Nguyen Province in Terms of Conditions for the Enjoyment of UI ………………………………………………………………… 63 Implementation of UI in Thai Nguyen Province in Terms ofConditions for the Enjoyment of UI Based on the Evaluation of the Respondents have been Grouped …………………… 64 The Respondents’ Perception on Implementation of UI in Thai Nguyen Province in Terms of UI fund ………………… 67 Implementation of UI in Thai Nguyen Province in Terms of UI Fund Based on the Evaluation of the Respondents have been Grouped ………………………………………………… 68 The Respondents’ Perception on Implementation of UI in Thai Nguyen Province in Terms of UI Regimes …………… 71 Implementation of UI in Thai Nguyen Province in Terms of UI Regimes Based on the Evaluation of the Respondents have been Grouped …………………………………………… 72 The Respondents’ Perception on Implementation of UI in Thai Nguyen Province in Terms of Procedures for UI Regimes ……………………………………………………… 76 Implementation of UI in Thai Nguyen Province in Terms of Procedures for UI RegimesBased on the Evaluation of the Respondents Have Been Grouped ………………………… 77 Implementation of UI in Thai Nguyen Province based on the Evaluation of the Respondents have been Grouped … 79 10 11 12 viii LIST OF FIGURES FIGURE PAGE Conceptual Framework ………………………………………… 36 Map of Vietnam ………………………………………………… 39 Map of Thai Nguyen Province ………………………………… 40 ix LIST OF APPENDICES APPENDIX PAGE A Letter of Request to the Respondents …………………… 101 B Questionnaire ……………………………………………… 102 C Tabulation and Computations of Data …………………… 105 x 96 For the policy - A review on the condition regarding premium payments and eligibility to the program should be reviewed (Unemployed personsare entitled to Unemployment Insurance when they satisfy the condition of, “having paid UI premiums for full twelve months or more within twenty four months before they became unemployed”.) - There should be rules about eligibility for different regimes and different groups of people or different contributing factors to unemployment Forthe implementation ofpolicy - Businesses,labor agencies, social insurance organizationsshouldhaveadequatecommunicationchannels withthe employees, so that theyunderstandtheconditionsof UI benefits and avoidbeing disadvantagedon theirinsurance unemployment regimes Recommendationson unemployment insurance fund For the policy - There should be specific provisions on plans for the collection of UI premium, generated revenues, the use of the UI fund, the investment activities from the UI fund - There should be provisionsforpenalizing prohibited acts such as inaccurate contributions to the UI fund, untimely payment, incorrect or inadequate payment based on employed people, frauds, falsification in implementing UI, troubling behaviors, causing obstacles, and damaging the legitimate rights and interests of employees and employers 97 Forthe implementation ofpolicy - A competent authority shall keep abreast of business and the unit to determine proper subjects of compulsory UI participants as a basis for the proper implementation of the policy, thus, ensuring full benefits for employees - Funds must be accounted by UI independent social insurance fund.In principle, there should be sufficient income and expenditure reserves, and idle funds can be invested for it grow and effectively ensure the safety of funds Recommendationson unemployment insurance regimes For thepolicy - Continue to maintainthe current UI regimes Iffund availability permits, the Stateshould continueresearchonsupport levelsforunemployment allowance - The Stateshould toapplyforunemployed regulatetwogroups people actively of UI regimes andunemployed peoplepassively Forthe implementation ofpolicy - Theunemployment allowance paymentneedsto comply with thelawto ensure compliance withthe purposeand significance ofsubsidies, andthe righttoobject tosuchsubsidies - Implement a moreeffectivesystems of supportfor vocational training and job searchassistance to help the unemployed get a new job 98 Recommendationson procedures for unemployment insurance regimes For the policy - Regulations on procedures for UI regimes should be simpler, with fewer steps, and involving lesser number of authorities to resolve issues - Regulations on some kind of time limitation should be more specific and more consistent with the actual situation - The Government should have some strict sanctions for employees, employers and authorities concerned who have not done or done improperly, incompletely, and/or untimely their obligations in the process of implementing procedures of Unemployment Insurance regimes Forthe implementation ofpolicy - Employers need to seriously implement their obligations such as certifying thesocial insurance books or supporting employees in the completion of their dossier to enjoy UI regimes - The competent authorities should have better coordination and processes to avoid unnecessary steps in the processing of the application for the policy There is a need to train staff on ethical behaviors and develop expertise to carry out the process of solving UI regimes - While still getting the benefit of the unemployment allowance, the employee need to informthe labor agency about of their job search status and help them deal with theeffectsofreasonableregimes 99 REFERENCES Cam Phong (2011).Should"further look" theunemployment insurance 100 Chung Pham Van (2012) Unemployment insurance: Save in time when employees lose their jobs Cuc Thu (2009) Implementation of unemployment insurance: Employees are passive Dinh Nguyen Van (2008) Organization of unemployment insuranceinVietnam, p43 Dung Pham Do (2012) Status of implementation of unemployment insurance in Vietnam, p37 Giang Tay (2010) Unemployment insuranceonlyforhunger relief Hai Pham Van (2010) Unemployment insurance - Situation and complete solutions in Vietnam, p Hien Van (2012) Unemployment insurancefundat risk ofrupture Hong Do Thu (2010) Unemployment implementation in Hanoi, p6 insurance program and its Khanh An (2013) in “UI has many shortcomings” Law on Social Insurance (2006) Milan Vodopivec and Minna Hahn unemployment insurance, p13 Tong (2008) China: Improving Ministry of Labour, Invalids and Social (2010) Circular No 32, issued on 10/25/2010 Guiding the implementation of some articles of Decree No 127, issued on 12/12/2008 Regulations detailing and guiding a number of articles of Social Insurance Law on UI Ministry of Labor, Invalids and Social (2010) Circular No 04, issued on 03/01/2013 To amend and supplement a number of articles of Circular No 32 Minh Nguyen Le (1988).Source ofemploymentandlabor, p20 Nhung Dang (2011) Shortcomings in the implementation of unemployment insurance Nhu Tran (2012) UI System: Enterprises are still difficulty Nguyen Pham (2012) Binh Duong: Nearly 100 thousand unemployed workers "false" to get the insurance money 101 Phuong Nguyen Hien (2008) "Social Security - the problems of theoretical and practical”, p45 – 46 Thai Nguyen Job placement center (2011) Report on the implementation of unemployment insurance in 2010 Thai Nguyen Job placement center (2012) Report on the implementation of unemployment insurance in 2011 Thai Nguyen Job placement center (2013) Report on the implementation of unemployment insurancein 2012 Thanh Kim (2012) Many workers are not entitled to unemployment benefits The Government (1995) Decree No 19 issued on 02/16/1995 The Government (2008) Decree No 94 issued on 22/8/2008 The Government (2008) Decree No 127, issued on 12/12/2008 Regulations detailing and guiding a number of articles of Social Insurance Law on unemployment insurance The Government (2008) Decree No 100, issued on 11.21.2012 to amend and supplement a number of articles of Decree No 127 Tien Mac Van (2010) The relationship between unemployment,unemployment insuranceandsocial securityin Vietnam, p35 Tiep Nguyen (2011) Unemployment insuranceCurriculum, p20 – 23 Tinh Tran Xuan (2010).The"holes" ofunemployment insurance Tho Pham Quy (2003) Vietnam Labor Market - Status and development solutions, p28 Thu Le Thi Hoai (2008) Unemployment insurance law of the market economy in Vietnam, p50 – 51 Van Dao (2013), "Implementation of UI: there are many "gaps" Vietnam Social Insurance (2011) Report on the implementation of unemployment insurance in 2010 Vietnam Social Insurance (2012) Report on the implementation of unemployment insurance in 2011 102 Vietnam Social Insurance (2013) Report on the implementation of unemployment insurance in 2012 Website: http://www.entrepreneur.com/encyclopedia) Website: http://www.molisa.gov.vn) Website: http://www.mof.gov.vn) 103 APPENDICES Appendix A Letter of Request to the Respondents 104 Republic of the Philippines SOUTHERN LUZONSTATEUNIVERSITY and SocialistRepublic of Vietnam THAINGUYENUNIVERSITY February 5, 2012 To the respondents, I am Phung Thi Cam Chau, a doctor of Business Administration student from Southern Luzon State University in the Republic of the Philippines and Thai Nguyen University of the Socialist Republic of Vietnam Currently, I am working on my Doctoral Thesis entitled “Evaluating the implementation of unemployment insurance in Thai Nguyen province”.In this regard, I am requesting for your invaluable help by accomplishing the attached questionnaire Please not leave any blank, and be rest assured that all your responses will be treated with confidentiality and used for academic purposes only Thank you very much for your help in attaining the objective of this research study Very truly yours, Phung Thi Cam Chau Researcher Appendix B 105 Questionnaire Part I: Profile of respondents Directions: Please accomplish the followings by putting a checkmark on the item that corresponds to your choice Rest assured that any information provided will be treated with trust and confidentiality Type of unit that you had worked in before unemployment: (1) Service unitsof the State (2) Large enterprises (3) Small and medium enterprises Your working duration before unemployment: (1) From 12 months to less than 24 months (2) From 24 months to less than 36 months (3) Over 36 months Your participation in unemployment insurance duration: (1) From 12 months to less than 24 months (2) From 24 months to less than 36 months (3) Over 36 months Your unemployment was caused by: (1) You have actively (2) You have to be active Your current job status: (1) Have a new job (2) Unemployed Part II The implementation of unemployment insurance in Thai Nguyen Province 106 Directions: The following items pertain to your perception on the implementation of UI in Thai Nguyen province Using the scale below, please accomplish by checking (X) the item that corresponds to your choice Weighted Scale Verygood Good Fair Weak Poor The assessdegrees Theevaluationproblems Coverage of UI Your understanding on the coverage of UI before insuring UI Your understanding on the coverage of UI at present Your corporate propagates UI program to you The labor agencies meet the requirements to provide information regarding UI The social insurance organizations meet your requirements to provide information regarding UI Your assessment of the issue: The current UI is only prescribed for mandatory participants without voluntary participation Your assessment of regulation: Laborers working under labor contracts or working contracts a term of less than twelve months not entitled to participate in UI Conditions for the enjoyment of UI Your understanding on conditions for the enjoyment of UI before the insuring UI Your understanding on conditions for the enjoyment of UI at present 10 Yourassessmentonregulation by which an unemployed persons are entitled to UI when they satisfy the condition: “Having paid UI premiums for full twelve months or more within twenty four months before they become unemployed” 11 Yourassessmentonregulation by which an unemployed persons are entitled to UI when they satisfy the condition: “Having registered their unemployment with the social insurance 107 The assessdegrees Theevaluationproblems organization” 12 Yourassessmentofregulation by which an unemployed persons are entitled to UI when they satisfy the condition: “Having not yet found a job within fifteen days after the date of making unemployment registration” UI fund 13 Yourassessmentofregulation: “Laborers' payment of 1% of the monthly salary or remuneration on which UI premiums are based” 14 Your assessment of regulation: “Employers' payment of 1% of the fund of monthly salaries and remuneration of laborers who participate in UI on which UI premiums are based” 15 Your UI fee payment 16 Your employer ’s UI fee payment 17 Your assessment of the ability to balance UI fund at the moment UI regimes 18 The effect of UI regimes for you 19 The effect ofunemployment allowance for you 20 The effect ofvocational training support for you 21 The effect ofjob-seeking support for you 22 The effect ofhealth insurance for you Appendix C Tabulation and Computations of Data 108 Procedures for UI regimes Source of Variation SS df MS F Between Groups 1.499868 Within Groups 7.804066 12 0.650339 Total 9.303934 14 P-value F crit 0.749934 1.153143 0.348278 3.885294 The implementation of UI in Thai Nguyen provincein terms of procedures for UI regimes SUMMARY Groups Count Employees in service units of the State Employees in large enterprises Sum Average Variance 23.28571 2.910714 2.116254 19.51429 2.439286 0.569315 Employees in small and medium enterprises ANOVA 18.06536 Source of Variation SS df Between Groups 1.815632 2.25817 0.163319 MS F 0.907816 0.955969 0.400547 Within Groups 19.94222 21 0.949629 Total 21.75785 23 The implementation of UI in Thai Nguyen province SUMMARY Groups Count P-value Sum Average Variance F crit 3.4668 109 Employees in service units of the State 30 Employees in large enterprises 30 Employees in small and medium enterprises ANOVA 30 105 3.5 1.081985 87.88571 2.929524 0.49558 75.58497 2.519499 0.487421 PSource of Variation SS df MS F value F crit 7.78EBetween Groups 14.54946 7.274729 Within Groups 59.88458 87 0.688328 Total 74.43403 89 10.56869 05 3.101296 110 CURRICULUM VITAE Name: PHUNG THI CAM CHAU (ROSE) Date of birth: September 9, 1982 Place of birth: Thai Nguyen Province, Viet Nam Address: Hoang Van Thu Ward, Thai Nguyen City, Thai Nguyen Province, Viet Nam Educational Background Master: Law Faculty, Viet NamNationalUniversity Course: Master of Law Year graduated: 2008 University: Ha NoiLawUniversity Course: Bachelor of Law Year graduated: 2004 UpperSecondary School: Thai Nguyen Gifted UpperSecondary School Year graduated: 2000 LowerSecondary School: Thai Nguyen Gifted LowerSecondary School Year graduated: 1997 Elementary School: DoiCanElementary School Year graduated: 1993 Working Experiences: 2004 to 2012: Lecture in ThaiNguyenCollege of Economics and Finance 2013: Lecture in Viet Nam Trade Union University ... study, "Evaluating the implementation of Unemployment Insurance in Thai Nguyen Province" aims to evaluatethe implementationof UI inThai Nguyen province in 2012andpropose recommendations toimprovethe... the status of the implementation of Unemployment Insurance policy in Thai Nguyen province in 2012, and propose some solutions to improve its implementation in Thai Nguyen province in the coming... evaluatethe implementationof Unemployment Insurance inThai Nguyen province in 2012,and(2) proposerecommendations toimprovethe implementation ofthe policy in the coming years In solving the identified