Vietnam Labor Management QA

Send an email to han4ww@evershinecpa.com
Or
Call us by phone in the day-worktime of Vietnam  (GMT+8)
The Manager of Global  Payroll Services
Ms. Kerry Chen, USA Graduate School Alumni & a well-English speaker
Wechat: kchen615
Skype: oklahomekerry

LRC – Vietnam Labor Regulations

LRC-VN-20.10
What must be included in the contents of a labor contract in Vietnam?

Evershine RD:
Job description, work hours, break time, salary, workplace, contract length, workplace hygiene, and safety and social insurance terms.

LRC-VN-20.11
Do Vietnam arrange labor contract in fixed term?
What should be the length of the labor contract in Vietnam?

Evershine RD:
Yes. Definite term contracts up to 36 months in length.
There are also indefinite term contracts.

LRC-VN-20.20
What is the minimum age for hiring a new employee in Vietnam?

Evershine RD:
The minimum working age is 15 years, except for certain jobs defined by the government.
Some of the jobs in which children under 15 but older than 13 can work are acting and athletics.
Other jobs that do not specify a minimum age include crafts jobs such as pottery glazing, wood carving, and embroidering.
An individual who employs workers must be at least 18 years old.
Employees under 18 are not allowed to work in hazardous or dangerous jobs as defined by the government.

LRC-VN-20.40
Is it a requirement for employers in Vietnam to conduct a pre-employment background check?

Evershine RD:
Employers are generally allowed to inquire into an employee or job applicant’s health and criminal histories, and under certain laws job applicants may be required to provide a prospective employer with a health certificate.
Third-party background checks are generally permissible if limited to verifying information provided by an applicant or employee.
In any case, an employer is well-advised to notify the employee or applicant that a background check will be conducted and better still to get the employee or applicant’s written consent.

LRC-VN-20.50
Is the Non-Competition indemnity clause in labor contract in Vietnam has legal effect?

Evershine RD:
Vietnamese labor law generally prohibits restrictions on an individual’s right to freely choose what work to perform.
Noncompetition agreements are therefore generally unenforceable in Vietnamese courts.
Employers nevertheless often include noncompete clauses in employment contracts but have to rely on a former employee’s voluntary compliance.

LRC-VN-40.05
What are the regulations on Gender Discrimination in employment specifically for female workers in Vietnam?

Evershine RD:
The Labor Code prohibits discrimination in employment based on sex.
Sex discrimination in recruitment, job duties, compensation and promotions are prohibited by the constitution and the Labor Code.
The Labor Code calls for affirmative action for women, requiring employers to give preference to hiring female applicants when they are qualified for an opening.
An employer may not dismiss a female employee due to marriage or pregnancy or if she is on maternity leave or is raising a child less than 12 months old unless the business terminates its operations.

LRC-VN-50.10
Can the employer in Vietnam collect, or process data transmitted by employees over the internet?

Evershine RD:
Both its business emails and the information technology system through which business emails are transmitted are the property of the employer.
In general, the labor code allows employers to monitor employees in the workplace to ensure that company rules are being observed.
Employers can observe employees’ use of the Internet and block access to specific websites.
However, employers seeking to collect or process personal information that employees transmit on the Internet must receive employees’ consent beforehand.

LRC-VN-60.10
What are the regulations on working hours in Vietnam?

Evershine RD:
By law, normal working hours of employees must not exceed 8 hours per day and 48 hours per week, although the Labor Code encourages employers to implement a 40-hour workweek.

LRC-VN-60.30
What are the regulations on overtime hours in Vietnam?
What is the overtime premium rate in Vietnam?

Evershine RD:
Overtime or night work is allowed only in certain jobs specified by the government.
Overtime cannot exceed 4 hours per day, 30 hours per month and 200 hours per year in special jobs, in which overtime can be up to 300 hours a year.
Effective Jan 1, 2021, overtime cannot exceed 40 hours per month.
Overtime worked on a usual day off is 200% of the regular hourly rate and on holidays is 300% of the regular rate.

LRC-VN-60.50
Is it common to pay 13^th month’s salary in Vietnam?

Evershine RD:
There is no legal requirement.
However, it is frequently given as an annual bonus and a Tet bonus awarded before employees begin their Lunar New Year holiday.

LRC-VN-70.10
What are the regulations on the general leave policy for employees in Vietnam?

Evershine RD:
According to Labor Code 2012, arts. 111-114.
An employee is entitled to annual leave with full pay after 1 year with an employer, as follows:
* 12 days for a person working in normal conditions
* 14 days for a person working in a hazardous or dangerous job or in a place with harsh living conditions or for a person under 18 years of age, and
* 16 days for a person working in an especially hazardous or dangerous job.
Annual leave increases at the rate of one for every additional 5 years with an employer.
An employee with less than 1 year with an employer receives leave in proportion to the duration of the employment.

LRC-VN-70.20
What are the public holidays in Vietnam?
What is the overtime premium rate during a public holiday in Vietnam?

Evershine RD:
According to Labor Code 2012, art. 97, 115.
Employees are entitled to the following 10 public holidays with full pay:
* Jan 1: New Year’s Day
* Lunar New Year Festival: 5 days
* March 10: Hung Kings Commemoration Day
* April 30: Victory Day
* May 1: International Labor Day
* Sept 2: National Day
Employees who are required to work on a public holiday are entitled to 300% of their usual wages.

LRC-VN-70.30
What are the maternity leave policy for a female employee in Vietnam?

Evershine RD:
According to Labor Code 2012, arts. 155-157; Law on Social Insurance, 2014, art.34.
During pregnancy, a female employee is entitled to 5 days paid leave for prenatal checkups, 5 2-day paid absences if the medical facility is distant, or the employee has an ailment.
A woman is entitled to 6 months of paid maternity leave, no more than 2 months of which can be taken before the child is born.
If the employee gives birth to 2 or more children, she is entitled to another 30 days of leave for each additional child.

LRC-VN-70.40
What are the paternity leave policy for a male employee in Vietnam?

Evershine RD:
According to Law on Social Insurance, 2014, art. 34.
A father is entitled to take paternity leave within 310 days of delivery as follows:
* 5 days if his wife gives birth naturally
* 7 days if his wife gives birth by caesarean section
* 10 days if his wife gives birth to twins (plus 3 additional days for each baby from the 3^rd child onwards)
* 14 days if his wife gives birth to twins by caesarean section

LRC-VN-70.50
What are the provisions on sick leave, bereavement leave and personal leave for employees in Vietnam?

Evershine RD:
According to Social Insurance Law, Arts. 22-23 and Labor Code 2012, Art. 116.

Sick leave:

Bereavement leave:

Employees are entitled to 3 days’ leave for the death of a spouse, child, parent, or parent of a spouse; they may take 1 day of unpaid leave upon the death of a grandparent or sibling.

Personal leave:

An employee may take unpaid leave for any reason if the employer agrees.

LRC-VN-70.60
What are the regulations on pension benefits and social security insurance benefits for employees in Vietnam?

Evershine RD:
According to Social Insurance Law, Arts. 24, 50 to 54, 63 to 66.
Vietnam’s social insurance system covers all private- and public-sector employees with employment contracts of at least three months.
The system provides benefits for employees for sickness, occupational injuries and disease, pregnancy, retirement, and death.
The maximum wage used for calculating contributions to social insurance is 20 times the minimum wage.

Sick child benefit:
A female employee may receive 75% of wages for up to 20 days in a calendar year to care for a sick child younger than age 3, 15 days for a sick child between the ages of 3 and 7.

Old age pension:

Disability grant:

The eligible person with a permanent total or partial disability at any age with an assessed degree of disability of at least 61%.
A Ministry of Health medical board assesses the degree of disability.

LRC-VN-70.70
What are the regulations on Workers’ Compensation for employees in Vietnam?

Evershine RD:
According to Social Insurance Law, Arts. 39-47.
All employees with employment contracts for a job lasting at least 3 months are covered by workers’ compensation.
There is no minimum qualifying period to receive benefits for a work injury or an occupational disease.
A list of occupational diseases is published by the Ministry of Health and the Ministry of Labor, Invalids, and Social Affairs after consultation with the Vietnam General Confederation of Labor, the nation’s central trade union, and representatives of employers.

After a permanent disability is assessed by a Ministry of Health medical board, benefits are paid according to the percentage of disability and number of years the worker has paid into the social insurance system.
Workers determined to have lost 5 to 30 percent of earning capacity get a lump sum, while those who have lost at least 31 percent of their earning capacity get a monthly benefit.
If the insured dies in a workplace accident or from an occupational disease or during initial medical treatment for an accident or disease, the worker’s relatives are entitled to a lump sum of 36 times the monthly minimum wage in addition to survivors’ benefits if they are eligible.

LRC-VN-80.05
Can the employee in Vietnam join a labor union?

Evershine RD:
Yes, workers have the right to establish or join a trade union and to participate in union activities to protect their rights.
An employer must recognize and cooperate with a trade union once it is legally formed; cannot legally discriminate against a worker for establishing, joining, or participating in the activities of a trade union; and may not use economic measures to interfere in the organization and activities of the union.

LRC-VN-80.06
How to handle labor dispute in Vietnam?

Evershine RD:
Collective labor disputes are first referred to the local labor mediator. Disputes not resolved at that level are referred to the provincial labor arbitration council, then to the people’s court.
While a dispute is before a labor council, neither party is allowed to take unilateral action against the other.
If an agreement cannot be reached, five days must pass following the conclusion of the labor arbitration council’s deliberations before a strike may be called.

LRC-VN-90.10
What are the regulations on workplace safety and health for employees in Vietnam?

Evershine RD:
According to Labor Code 2012, arts. 137-150. The employer must ensure that the workplace meets government standards for space, ventilation, and lighting, as well as limits on dust, steam, noxious gases, radiation, heat, noise, vibration, and other harmful factors.
Workplaces must be periodically checked to ensure their safety.
Specific training must be provided for managers and employees who must meet strict safety and hygiene requirements.
Employers may monitor employees in the workplace but only with their consent.
Maintenance and repair of machines, equipment, buildings, and storage facilities are the responsibility of the employer.

LRC-VN-100.10
What are the circumstances that an employer can terminate an employee in Vietnam?

Evershine RD:
According to Labor Code 2012, arts. 38, 126.
An employer may dismiss an employee if:

•  the employee consistently fails to perform the duties of the job.
•  the employee has not recovered from an illness or accident after 6 months’ treatment (under a fixed-term labor contract), one-half of the contract term (under a casual labor contract) or 12 months’ treatment (under a regular labor contract), although in this case the employee may be considered for a new contract.
•  the employee has committed theft or embezzlement, disclosed business or technological secrets, or committed another act that causes serious damage to property or other interests of the business.
•  the employee was disciplined by being transferred to a new job and commits a new offense during the period of the discipline.
•  the employee is absent from work without a valid excuse for 5 days in a month or 20 days in a year.
•  natural disasters, fires, or other extraordinary circumstances force the employer to scale down production and reduce its labor force; or
•  the business closes. (Effective Jan. 1, 2021, new grounds for terminating employees include when they reach retirement age, fail to show up for work for 5 consecutive days without a legitimate reason, and are dishonest or provide false information during the recruitment process.)

An employer is not allowed to unilaterally terminate an employee if:

•  the employee is under medical treatment due to sickness, a workplace accident, or an occupational disease
• the employee is on annual leave, personal leave, or any other leave taken with the employer’s consent.
• An employer may not dismiss a female employee due to marriage or pregnancy or if she is on maternity leave or is caring for her child under 12 months of age unless the business terminates its operations.

LRC-VN-100.11
What is the notification period for terminating an employee in Vietnam?
How much is the severance pay?

Evershine RD:
According to Labor Code 2012, arts. 48-49.
Except for dismissals due to criminal conduct, repeat offenses, or repeated absences, employer shall notify termination to the employee according to the contract term.

If termination occurs because of a disciplinary measure or an employee has worked with an employer less than a year,

Improperly dismissed of an employee:
The employer must reinstate the employee and pay back wages plus at least 2 months’ salary.
If the employee does not want to return to work, the employer must pay back wages, the 2 months’ salary, and 1 month’s wages for every year of service.

Proper dismissed of an employee:
Upon lawful termination of a labor contract with an employee who has worked for the company for a year or more, the employer must pay severance of one half of 1 month’s salary for every year of service.
The redundancy allowance that is only applicable in cases of retrenchment is one month’s salary for each year of employment, but at least two months’ salary.
The employer also must compensate the employee for any outstanding wages, unused annual leave, or bonus owed to the employee.
Periods of probation, apprenticeship, and job practicing do not count towards total length of service for purposes of calculating severance payment.

LRC-VN-100.12
What is the reporting requirement for employers in Vietnam to notify the termination of employees to the competent authority?

Evershine RD:
Trade Union (internal Trade Union of the Employer or the District-level Trade Union) and DOLISA (Department of Labor, Invalids and Social Affairs) in the termination process require specific meetings, minutes, and approvals to be followed.
Although the processes may not specifically require Trade Union consent to gain final DOLISA approval, it is certainly encouraged to avoid protracted disputes.

LRC-VN-100.20
What are the regulations on mass layoffs in Vietnam?

Evershine RD:
According to Labor Code 2012, art. 44. If a business restructuring, technological change, or economic recession causes a worker to lose a job, the employer has a duty to retrain the employee and assign him or her to a new job.
If no new job exists or can be created and the worker must be dismissed, the employer must pay the worker 1 month’s salary for every year of service with a minimum of 2 months’ salary.
If a mass layoff is necessary, the employer must give prior notice of 30 days to the local trade union and labor office.

LRC-VN-100.30
What is the time limit for employer in Vietnam to pay employees upon termination?

Evershine RD:
Severance pay is due within seven days of the termination.

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E-mail: han4ww@evershinecpa.com
or
Contact us by We Chat or Skype or Whats App in the day-work-time of Vietnam  (GMT+8)
The Manager of Global  Payroll Services
Ms. Kerry Chen, USA Graduate School Alumni & a well-English speaker
Wechat: kchen615
Skype: oklahomekerry

or
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Please send an email to HQ4han@evershinecpa.com
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Email: kerrychen@evershinecpa.com
Skype: oklahomekerry

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