To correct this either widen the sill plate or install joist hangers.
Replacing the sill plate could be tricky as it will probably be bolted vertically into the CMU foundation. There should be a damp proof layer between the concrete and the wood. If you do decide instead to add wood to the side of the sill plate be sure to put a damp proof layer below it.
Installing joist hangers will require jacking up each joist by the thickness of the metal in the hanger, there's a risk that this may disturb walls and trim on the floor above. if the floor surface above is something inflexible like ceramic tiles I would not be installing joist hangers - too much risk of busting the tiles.
Joists must have 1-1/2" bearing on the sill plate under IRC R506.2. Your joists are therefore deficient.
Fix this with joist hangers. Your image seems to show a 2×10. If that's the case, then get a joist hanger built for 2×10s. The existing toe nails provide some strength, so drive them deeper to clear the connection for the joist hanger. Simpson makes their own nails and screws for their hangers. Use those instead of whatever you have laying around the house.
For nails, you want their 10d 1-1/2" nails for straight nailing and their 10d 3" nails for toe nailing. That's for the typical scenario of a single rim board, though. With the tiny bit of sill plate you have, however, I suspect that you may have a double rim board. In that case you would want nothing but 10d 3" nails.
For screws, you would substitute SD9 1-1/2" screws for the 10d 1-1/2" nails, and you would substitute SD9 2-1/2" screws for the 10d 3" nails. See Simpson's chart to confirm.