Labor regulation and employee benefit under Vietnam Law

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SBLAW would like to brief on labor regulation and employee benefit under Vietnam Law as follows:

  1. Labor Contract

Labor Contract shall be entered with the Employee directly, unless the employee is from 15-18 years old. Labor contract for a period more than 3 months, must be executed in writing and in duplicate. A contract for a temporary job under three months can be agreed upon verbally.

The Employer should provide the information about work, work location, work conditions, working hours, break time, labor safety, labor hygiene, salary, method of salary payment and other directly related issues int the labor contract. Meanwhile, the employee should provide complete information regarding his/her name, gender, residence, educational background, vocational skills, health condition and other directly related issues in the labor contract.

Labor contract should clearly indicate whether the labor contract is with indefinite term or fixed term. If the contract is for a fixed term and the employee continues to work even after the expiry of the fixed term then Employer should execute new contract within 30 days of its expiry date. Otherwise, the contract will automatically be extended for a fixed term of 24 months or become a contract with indefinite term as the case may be.

Contract with fixed term can be extended only one more term and after such period, if the employee continues to work, Employer shall execute a contract with indefinite term.

  1. Working hours 

The working hours shall be 8 hours a day or 48 hours per week. The employee can be asked to work over time, which may be necessary during busy time. The overtime hours shall be agreed upon between Employer and Employee which shall be to a maximum of 4 hours per day. At no time, the overtime hours of an employee shall exceed 200 hours per year.

  1. Rest hours

Employee is entitled for 30 minutes of rest during the working shift of 8 hours. Female employee is entitled to 30 minutes of rest per working day during her menstrual period.

Female employee from the 7th month of pregnancy shall be allowed to work 30 minutes less than the normal working hours, while continuing to receive full pay. Meanwhile, female employee caring her child of less 12 months of age is entitled to 60 minutes off during working time while continuing to receive full pay.

 

  1. Weekly break: Sunday or Sunday and Saturday (depending on agreement between Employer and Employee).

 

  1. Public Holiday:

New Year: January 1st

Vietnamese New year: 5 days

King Hung’s Anniversary: March 10th of lunar calendar (1 day)

Victory day: April 30th

Labor day: May 1

Independence day: September 2

 

  1. Annual leave

Employee having completed 12 months service for Employer shall be entitled to an annual leave of 12 days with full pay. For Employee having completed more than 5 years of service, there shall be a proportionate increase of one day holiday for every 5 years of service.

 

  1. Fully paid personal leaves

3 days for one’s own marriage,

1 day for marriage of one’s son or daughter

3 days in case of death of the parent, parent in law, spouse, son or daugher

1 day in case of death of the grandparent, siblings

Male employee is entitled to 01 day off in case his wife giving birth.

 

  1. Maternity Leave

Female employee is entitled to maternity leave before and after child birth, for 6 months. If she gives birth to a twin or more children, she shall be entitled to another 30 days of leave for each additional child.

 

  1. Wage

Employee shall be paid as per labor contract signed between Employee and Employer. Wage must not be lower than minimum wage applicable under Vietnam Law. Wage shall be paid in Vietnam Dong.

Employee who works overtime is paid according to his hourly wage as following:

150% on week days

200% on weekend

300% on holiday and days-off with pay as well as a compensatory day-off

Employee working overtime at night shall be entitled to an additional payment of 30% of work done in the day time.

 

  1. Social Insurance and Health Insurance and Un-employment Insurance

Social Insurance: Employer: 18% of wage, Employee: 8% of wage

Health Insurance: Employer: 3% of wage, Employee: 1.5% of wage

Unemployment Insurance: Employer: 1% of wage, Employee: 1% of wage

  1. Labor Contract Termination

In case of following events, Labor Contract shall be terminated:

– Expiry of labor contract;

– Completion of work under labor contract;

– Termination per agreement between two Parties;

– Employee satisfies insurance duration and pension age under Vietnam Law;

– Employee is condemned to imprisonment, to death or prohibited from doing the work in labor contract according to the legal judgment and decision from the Court;

– Employee dies, is declared dead, missing or incapable of civil acts by the Court

– Employer dies or is declared dead, missing or incapable of civil act by court or stops the operation.

– Employee is dismissed under Vietnam Law;

– Employee unilaterally terminate Labor Contract under Vietnam Law;

– Employer unilaterally terminate Labor Contract under Vietnam Law.

Here above is basic information about Labor Law in Vietnam. If you have any further inquiry, please feel free to contact us.