What is the time limit for settling all payments to employees upon termination of employment contracts due to the division of enterprises in Vietnam?
- What is the time limit for settling all payments to employees upon termination of employment contracts due to the division of enterprises in Vietnam?
- Will laid off employees receive redundancy allowances in Vietnam?
- What are the main contents of labor utilization plans for the division of enterprises in Vietnam?
What is the time limit for settling all payments to employees upon termination of employment contracts due to the division of enterprises in Vietnam?
Pursuant to Article 48 of the Labor Code 2019, regulations on responsibilities of the parties upon termination of an employment contract are as follows:
Responsibilities of the parties upon termination of an employment contract
1. Within 14 working days following the termination of an employment contract, both parties shall settle all payments in respect of the rights and interests of each party. In the following cases, such period may be extended, but shall not exceed 30 days:
a) Shutdown of business operation of the employer that is not a natural person;
b) Changes in the organizational structure, technology or changes due to economic reasons;
c) Full division, partial division, consolidation, merger of the enterprise; sale, lease, conversion of the enterprise; transfer of the right to ownership or right to enjoyment of assets of the enterprise or cooperative;
d) Natural disasters, fire, hostility or major epidemics.
2. Priority shall be given to payment of the employees’ salaries, social insurance, health insurance, unemployment insurance, severance allowance and other benefits under the collective bargaining agreement and employment contracts in case of shutdown, dissolution or bankruptcy of an enterprise or cooperative.
3. The employer has the responsibility to:
a) Complete the procedures for verification of duration of participation in social insurance and unemployment insurance, return them and original copies of the employee’s other documents (if any);
b) Provide copies of the documents relevant to the employee’s work if requested by the employee. The employer shall pay the cost of copying and sending the documents.
Thus, within 14 working days following the termination of an employment contract, both parties shall settle all payments in respect of the rights and interests of each party. Such period may be extended, but shall not exceed 30 days.
What is the time limit for settling all payments to employees upon termination of employment contracts due to the division of enterprises in Vietnam?
Will laid off employees receive redundancy allowances in Vietnam?
Pursuant to the provisions of Clause 3, Article 43 of the Labor Code 2019, regulations on the obligations of the employer in case of full division, partial division, consolidation, merger of the enterprise; sale, lease, conversion of the enterprise; transfer of the right to ownership or right to enjoyment of assets of the enterprise or cooperative as follows:
Obligations of the employer in case of full division, partial division, consolidation, merger of the enterprise; sale, lease, conversion of the enterprise; transfer of the right to ownership or right to enjoyment of assets of the enterprise or cooperative
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3. The laid off employees will receive redundancy allowances in accordance with Article 47 of this Code.
Pursuant to Article 47 of the Labor Code 2019 regulating job loss benefits
Redundancy allowance
1. Where an employment contract is terminated according to Clause 11 Article 34 of this Labor Code and the employee has worked on a regular basis for the employer for at least 12 months, the employer shall pay a redundancy allowance to the employee. Each year of work will be worth 01 month’s salary and the total redundancy allowance shall not be smaller than 02 month’s salary.
2. The qualified period of work as the basis for calculation of redundancy allowance shall be the total period during which the employee actually worked for the employer minus the period over which the employee participated in the unemployment insurance in accordance with unemployment insurance laws and the period for which severance allowance or redundancy allowance has been paid by the employer.
3. The salary as the basis for the calculation of redundancy allowance shall be the average salary of the last 06 months under the employment contract before the termination.
4. The Government shall elaborate this Article.
Thus, employees who are laid off due to business division will receive unemployment benefits as follows:
- Where an employment contract is terminated and the employee has worked on a regular basis for the employer for at least 12 months, the employer shall pay a redundancy allowance to the employee. Each year of work will be worth 01 month’s salary and the total redundancy allowance shall not be smaller than 02 month’s salary.
- The salary as the basis for the calculation of redundancy allowance shall be the average salary of the last 06 months under the employment contract before the termination.
Note: The qualified period of work as the basis for calculation of redundancy allowance shall be the total period during which the employee actually worked for the employer minus the period over which the employee participated in the unemployment insurance in accordance with unemployment insurance laws and the period for which severance allowance or redundancy allowance has been paid by the employer.
What are the main contents of labor utilization plans for the division of enterprises in Vietnam?
Pursuant to Article 44 of the Labor Code 2019, regulations on labor utilization plan are as follows:
Labor utilization plan
1. A labor utilization plan shall have the following contents:
a) The names and number of employees to be retained, employees to be retrained for further employment, and employees to be working on part-time basis;
b) The names and number of employees to retire;
c) The names and number of employees whose employment contracts have to be terminated;
d) Rights and obligations of the employer, employee and relevant parties regarding implementation of the labor utilization plan;
dd) The measure and financial sources to implement the plan.
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Thus, a labor utilization plan shall have the following contents:
- The names and number of employees to be retained, employees to be retrained for further employment, and employees to be working on part-time basis;
- The names and number of employees to retire;
- The names and number of employees whose employment contracts have to be terminated;
- Rights and obligations of the employer, employee and relevant parties regarding implementation of the labor utilization plan;
- The measure and financial sources to implement the plan.
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