From January 01, 2021, will employers in Vietnam make payments for untaken annual leave?

From January 01, 2021, will employers in Vietnam make payments for untaken annual leave? (illustrative photo)

Under Clause 3, Article 113 of the Labor Code 2019 (effective from January 01, 2021) stipulates:

Annual leave

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3. An employee who, due to employment termination or job loss, has not taken or not entirely taken up his/her annual leave shall be made payment for the untaken leave days.

Thus, from January 01, 2021, due to employment termination or job loss, only employees who have not entirely taken up their annual leave in Vietnam shall be made payment for the untaken leave days.

In addition, under this regulation, the employee who continues working for the employer but has not taken or has not entirely taken his/her annual leave will not be made payment for the untaken leave days.

Currently, Clause 1, Article 114 of the Labor Code 2012 stipulates:

Payment for untaken leave days

1. An employee who, due to employment termination, job loss or for other reasons, has not taken or fully not taken annual leave is entitled to a cash payment for the untaken leave days.

Under current law, besides employment termination or job loss, the employee in Vietnam is still made payment for the untaken leave days in the “other cases”.

This is one of the notable new contents having a significant impact on all employees working under agreements, being paid, and being managed, directed, and supervised by the employer. To ensure their rights, employees may reach an agreement with the employer on taking annual leave in installments or combining annual leave over a maximum period of up to 03 years (Clause 4, Article 113 of the Labor Code 2019).

Note: From January 01, 2021, employees calculate their annual leave days according to the provisions of Article 113 and Article 114 of the Labor Code 2019.

Thu Ba

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