Hiring in Vietnam
For the Vietnam PEO Services, Labour contracts in Vietnam may fall into one of these 3 terms:
- Indefinite term where the term is not specified
- Definite term where a term as a period between 12 and 36 months is specified
- Specific/Seasonal term where a term of less than 12 months is specified
If an employee continues to work after the expiration of his or her definite term or specific/seasonal contract, the contract must be renewed within 30 days after the expiry date or it shall become an indefinite term contract. In addition, after two successive definite term contracts with an employee, an indefinite term contract must be signed.
When a labour contract is terminated, employers may be liable for a severance payment to the employee, depending on the salary, length of employment and the period of time the employee has been covered under social insurance. Severance payments equal to half a month of wages for every year of employment will be required where the employer or employee can prove that a prescribed unilateral termination has occurred.
Work Hours
Normal working time shall not exceed 8 hours per day or 48 hours per week.
For works considered extremely hard, harmful and dangerous, daily working time shall not exceed 6 hours.
Employers requiring employees to work overtime must first obtain their consent. Also, the overtime hours shall not exceed 50% of the normal daily working hours. On a weekly basis, the total working hours shall not exceed 12 hours a day. Also, the total overtime hours shall not exceed 30 hours in a month and 200 hours in a year. After consecutive days of overtime work in a month, compensatory days off must also be arranged.
Normally, employees who have worked continuously for 8 hours shall be entitled to a break of at least half an hour which is considered to be included as working hours. For night shift workers, the break time shall be at least 45 minutes. Employees who work on shift are entitled to a break of at least 12 hours before starting with another shift. Also, each week, employees are entitled to a rest of at least 24 consecutive hours. However, the employer can decide whether the weekly rest will fall on Sundays or another fixed day in the week.
Holidays and Leaves
Vietnam observes the following public holidays for which an employee shall be entitled to fully paid days off.
New Year’s Day |
1 January |
Lunar New Year |
Based on Lunar Calendar (5 days) |
Victory Day |
30 April |
International Labour Day |
1 May |
National Day |
2 September |
Commemorative Celebration of Vietnam’s Forefather |
Based on Lunar Calendar (1 day) |
Foreign citizens working in Vietnam are also entitled to an additional day off for their country’s National Day.
An employee who has been working for an employer for full 12 months shall normally be entitled to 12 working days of fully paid annual leave. Extra paid leave provisions are required by law for heavy, hazardous or dangerous jobs. An employee may agree with the employer on taking annual leave in instalments or combining annual leave of a maximum every three years. If an employee needs to travel on roads, railways or waterways when taking annual leave so that the round trip takes more than 2 days, travel days starting from day 3 will be calculated in addition to the annual leave. However, this is applicable only for one annual leave every year. Employees with a period of employment less than 12 months shall be entitled to annual leave calculated in proportion to the period of employment.
Employees working overtime on normal weekdays shall be paid with a wage rate of at least 150%. For weekly days off / weekends, the wage rate shall be at least 200%. For public holidays and paid leave days, it will be at least 300%. Whereas employees who work at night shall be paid an additional amount at least equal to 30% of the wage for a normal working day, those working overtime at night shall, in addition, also be paid an extra 20% of the day time wage.
Compulsory Social Insurance
This will cover employees’ benefits on sickness, maternity/paternity, occupational accident, disease and retirement. Employers shall make a monthly contribution in proportion to the employee’s payroll as follows :
- 3% into the sickness and parental insurance benefit fund
- 5% into the occupational accident and disease benefit fund
- 14% into the retirement and death insurance benefit fund
Maternity and Paternity Benefits
Both Maternity and Paternity Benefits are available to employees who have participated in compulsory social insurance.
Maternity benefits are available to the following types of employees : pregnant female employees, female employees giving birth, female employees as surrogate mothers and intended mothers, employees adopting under-6-month children, female employees having intrauterine devices or employees taking sterilization measures, male employees currently paying social insurance premiums whose wives giving birth. Besides, pregnant female employees are entitled to take leaves for 5 prenatal check-ups with one day for each check-up. Those living far away from health establishments or having pathological signs or abnormal pregnancies are entitled to 2 days leave for each check-up. The leave period shall be counted in working days, excluding public holidays and weekends.
Within the first 30 days after their wives giving childbirth, the husbands are entitled to a leave from 5 to 14 working days. It will be 5 working days for normal child-giving, 7 working days in case of the wives undergoing a surgical birth or giving birth to children before 32 weeks of pregnancy, 10 working days in case of the wives giving birth to twins (or additional 3 working days for each infant from the second), 14 working days in case of the wives giving birth to twins or more infants with childbirth operation.
Also, female employees giving birth or employees adopting an under-6-month child are entitled to a lump-sum allowance equal to 2 times the basic salary. If the father is covered by social insurance and has paid social insurance premiums for at least 6 months within 12 months before childbirth, he is also entitled to a lump-sum allowance equal to 2 times the basic salary.
Sickness Benefits
Sickness benefits of employees are also covered by their social insurance.
Employees off from work due to sickness or accident are entitled for an allowance of 30 to 70 days depending on his/her social insurance contribution duration and working conditions. Those having to look after their children under 7 years old are entitled to 15 to 20 days depending the children’s age. Those suffering from diseases in the list of long treatment diseases are entitled to a maximum of 180 days of leave per year. Rate of sickness benefits will be lower if the treatment continues after 180 days.