According to the Draft Amendment to the Labor Code, the Ministry of Labor, Invalids and Social Affairs has proposed that the maximum overtime hours for workers could be increased to 600 hours per year.
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Explaining the proposal, the Ministry of Labor - Invalids and Social Affairs stated that in labor relations, many businesses and a significant portion of employees wish to have additional time to complete tasks well and keep up with market competition trends; particularly, employees can increase their income through extended overtime.
The Vietnam Chamber of Commerce and Industry, representing businesses, stated: “Article 106 of the Labor Code stipulates that overtime should not exceed 200-300 hours/year, which is not reasonable and significantly hampers business operations because the specific overtime hours in a day should allow both parties to freely negotiate, depending on work requirements. The government should set a maximum overtime limit per month or per year since in many cases, businesses receive large orders and need to mobilize employees for overtime in a certain period. Furthermore, many employees proactively want to work overtime as they get higher wages and may receive meal allowances from the company. Besides, many employers have to hire additional workers, which comes with significant training, protection, and welfare costs. Employees with spare time are not allowed to utilize it for extra earnings.”
The current advanced trend of humanity is to perform multiple tasks in a short time, meaning reducing work hours but still ensuring labor productivity and health. Employees in Vietnam work on average about 8 hours/day, and depending on the nature of the job, this period can be seen as many, few, or enough. Some jobs require employees to work continuously, do overtime, leading to health exhaustion, and lack time for other activities like family care, educating children, etc. However, some jobs are completed within standard hours. Besides the nature of the job, the work environment and equipment of the company also contribute significantly to the labor quality. But if work hours are increased while labor productivity is limited, will it be effective? Overtime not only affects employee health but also brings no benefit to the employer. There are also opinions that reducing actual work hours at the company allows employees to work outside for additional income. Therefore, regulations should be appropriate.
Compared to regional countries, the maximum overtime hours of Vietnamese workers are currently low (30 hours/month). Meanwhile: China 36 hours/month; Indonesia 56 hours/month; Singapore 72 hours/month; Thailand 36 hours/week; Malaysia 104 hours/month; Laos 45 hours/month; Cambodia and the Philippines have no restrictions.
Regarding this issue, at the Vietnam Business Forum held on December 5, Mr. Ryu Hang Ha, President of the Korean Business Association, noted that current overtime hours do not consider peak and off-peak periods for each business. The association recommends a flexible implementation of the 30-hour monthly overtime limit. During peak periods, businesses can increase overtime to meet production demands and vice versa.
The current Draft Labor Code proposes two options for public consultation:
Option 1: Ensure that the total overtime and normal working hours for employees do not exceed 12 hours/day and no more than 5 continuous days for each overtime period; however, the total overtime should not exceed 600 hours/year;
Option 2: Ensure that the total overtime and normal working hours for employees do not exceed 12 hours/day and no more than 5 continuous days for each overtime period.
Regarding the overtime regulations in special cases, the Draft Labor Code has adjusted Clause 2, Article 107 of the 2012 Labor Code and added specific contents as follows:
Employers have the right to require employees to work overtime on any day, and employees cannot refuse in the following cases:
Perform necessary and urgent tasks to prevent loss of life or property in case of disaster prevention, fire, epidemic, and other calamities;
Perform urgent repairs on machinery, equipment, production lines to prevent serious loss or damage;
Perform urgent tasks to prevent loss or damage to perishable goods.
It is expected that in March 2017, the Government of Vietnam will submit the Labor Code to the legislative review agency of the National Assembly, and the National Assembly Standing Committee. By April 2017, the Labor Code Project will be presented to the National Assembly.
Currently, the Draft Labor Code is still open for comments on the Government of Vietnam's online portal.
