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Collaborator or piecework: is social insurance still due?

Many companies sign "collaborator" or "piecework" contracts believing this removes any social insurance obligation. That is not quite true. Since 1 July 2025, when the Law on Social Insurance No. 41/2024/QH15 took effect, whether a person falls under compulsory social insurance is determined by the substance of the working relationship — not by the label on the contract.

Updated 12 October 2026: added what a piecework contract is, a comparison with an employment contract (insurance, tax, termination) and a direct answer on whether piecework contracts require social insurance.

Is the contract's name still a shield?

The Law on Social Insurance No. 41/2024/QH15 and Decree No. 158/2025/ND-CP determine who is subject to compulsory social insurance based on the actual content of the arrangement. If an arrangement — whether called a "collaborator", "piecework" or "service" contract — in fact involves paid work performed under the management, direction and supervision of the hiring party, then it is an employment relationship.

Two conditions must be met together for the compulsory social insurance obligation to arise: a contract term of one full month or more and a monthly wage at or above the reference level. Only when one of the two is missing does the arrangement fall outside compulsory coverage. This is a point many businesses do not fully grasp, which leads to incorrect application.

What are the three signs of an employment relationship?

In practice, an employment relationship shows three signs:

• Subject to management and direction: the worker must follow the company's assignments, internal rules, working hours and processes — unlike an independent contractor who controls how the work is done.
• Regular, stable pay: payment is tied to working time (per month, per shift) rather than to the outcome of an independent, self-contained job.
• Ongoing, repetitive work: the tasks are part of the company's routine operations, not a project with a clear start and end.

When all three signs are present, calling the contract a "collaborator" agreement does not change its substance, and the social insurance authority has grounds to reclassify the relationship as employment.

When is piecework genuinely piecework?

Not every piecework contract gets reclassified. Legitimate piecework typically has these features: the contractor controls the method, timing and means of performance; is paid for the result of a specific, self-contained job with a clear start and end; and is not subject to day-to-day direction like an employee. Typical examples include hiring an individual to design a brand identity, translate a document, or repair a specific part of a project.

Conversely, if the "contractor" in reality works at a fixed place within the company, on set hours and under daily assignment, then even if the contract says "piecework", the substance remains an employment relationship. The dividing line lies in the degree of autonomy and independence of the work, not in the title of the document.

How much does social insurance cost if coverage applies?

For part-time staff who fall under coverage, compulsory social insurance is calculated on the reference level of 2,530,000 VND per month. Specifically:

• The employer pays 21.5% = 543,950 VND per person per month
• The employee pays 10.5% = 265,650 VND per person per month
• Total 809,600 VND per person per month

This is a transparent, fixed figure that is easy to budget. Compared with the cost and risk of a later arrears collection, paying correctly from the outset is usually the safer option for a business.

What's the risk of getting the substance wrong?

When the social insurance authority reclassifies a "collaborator" as an actual employee, the company may have to pay back social insurance for the period it should have contributed, plus late-payment interest, and may face administrative penalties. Beyond the financial cost, this triggers file reviews, bookkeeping adjustments and strain on the relationship with workers.

The risk rises when a company maintains a large body of "collaborators" doing routine work over a long period — this is the group most likely to be cross-checked and reclassified.

What are the three lawful ways to formalize?

Rather than looking for a different label for an employment relationship, a business should choose a compliance path that fits its real needs.

1. Convert to an employment contract and pay full social insurance. Suitable when the work is ongoing and the worker is a long-term fit. This is the most transparent approach and fully removes reclassification risk.

2. Use a labour supply service. When demand is seasonal or fluctuates, a business can partner with a provider holding a labour sub-leasing licence. The provider acts as the employer of the workers, taking on the contract and social insurance responsibility. Learn more about the labour supply service.

3. Outsource payroll and compliance to a specialist. When a business wants to manage its own staff but needs payroll, social insurance filing and personal income tax handled lawfully, it can use an outsourced payroll service to standardize the whole process.

For a foreign company with no legal entity in Vietnam that needs to hire and pay Vietnamese staff lawfully, the EOR — Employer of Record model lets workers be contracted and covered by social insurance in full, without setting up a company.

What is a piecework contract in Vietnam?

A piecework contract (also called a job-contracting agreement) is an agreement under which the contractor organises a specific job independently, takes responsibility for how it is done and hands over the result in return for a fee; legally it is a service contract under Article 513 of the 2015 Civil Code, not an employment contract. The party commissioning the work only accepts the result — it does not manage working hours, assign daily tasks or pay a time-based salary.

The legal dividing line is Article 13(1) of the 2019 Labour Code: where the parties use a different name but the content involves paid work, a salary and management, direction and supervision by one party, the agreement is still treated as an employment contract. So the same document titled "piecework contract" can be a genuine service contract, or a disguised employment contract.

How does a piecework contract differ from an employment contract?

A piecework contract buys the result of a job, while an employment contract buys the employee's working time under the employer's management; that difference drives differences in the governing law, insurance, tax and how the contract ends.

The 10% withholding rate and the 5,000,000 VND per-payment threshold apply from 1 July 2026 under Article 50(2) of Decree 253/2026/ND-CP, replacing the previous threshold of 2,000,000 VND per payment. An individual whose only income is this and whose estimated income for the year is below the taxable level can sign a commitment so that tax is not withheld for the time being.

See also: Severance Pay in Vietnam (2026): Eligibility, Formula and Examples

Do piecework contracts require social insurance in Vietnam?

A genuine piecework contract — where the contractor works independently, takes responsibility and only hands over a result — is not subject to compulsory social insurance; but if in practice the contractor works as assigned, keeps set hours and receives a fixed monthly or per-shift payment, it is an employment contract and the business must pay compulsory social insurance as for any employee, including back contributions for the period already worked.

A quick self-check: if the business's day-to-day work is disrupted without this person, the person clocks in or works shifts, and receives a fixed amount every month, it is almost certainly an employment relationship. Once covered, the employer pays 21.5% and the employee 10.5% of the salary used as the contribution base, as in the cost example above.

Nhan Kiet as your partner

Nhan Kiet Manpower Supply Co., Ltd (Tax code 0308022768) has operated since April 2009, now in its 17th year in human resources and labour compliance. Nhan Kiet holds labour sub-leasing licence No. 15/2019/SHCM along with ISO 9001:2015, ISO 45001, ISO 14001 and ISO/IEC 27001:2022 certifications, and currently serves more than 500 clients across 34 provinces and cities with more than 200 operations staff.

If your business uses collaborators, piecework or seasonal labour and wants a review to formalize your workforce lawfully, the Nhan Kiet team can help assess the substance of each type of relationship and propose a suitable course of action.

Contact: Nguyen Quoc Trung — Deputy General Director, phone 0908 636 108, email trungnguyen@nhankiet.vn. Office: Room 202, Building 57, 57 Le Thi Hong Gam, Ben Thanh Ward, Ho Chi Minh City — phone 028 3505 4224.

See also: labour compliance · Compulsory Social Insurance for Part-Time Workers in 2026: The Real Cost to Businesses and 3 Ways to Handle It · Employer Costs in Vietnam Are Capped: Why Senior Hires Cost Less Per Dollar (2026)

Legal sources

Official texts (in Vietnamese) on the Vietnamese Government's legal portals:

• Labour Code 2019 (No. 45/2019/QH14)
• Law on Social Insurance 2024 (No. 41/2024/QH15)
• Decree 253/2026/ND-CP: guiding the Law on Personal Income Tax
• Decree 158/2025/ND-CP: guiding the Law on Social Insurance on compulsory social insurance

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