An employment contract is an agreement between an employee and an employer in the labor relations. From January 01, 2021 (effective date of the Labor Code 2019 of Vietnam), when drafting an employment contract, enterprises should pay attention to the 05 following contents:
Article table of contents
1. Drafting employment contract based on provisions of the new Labor Code
The Labor Code 2019 of Vietnam takes effect on January 01, 2021 and replaces the Labor Code 2012. Thus, instead of using the Labor Code 2012 when drafting employment contracts, enterprises must base on the new Labor Code and avoid using forms according to the Labor Code 2012.
Thus, from January 01, 2021, enterprises need to ensure that they use valid legal bases to draft employment contracts, specifically include:
- Law on Social Insurance 2014;
- Tax legal documents;
- Company’s regulations and charters;
- etc.
2. There are only 02 types of employment contracts
This is a notable content that enterprises should pay attention to when drafting employment contracts from 2021. Specifically, the Labor Code 2019 of Vietnam has annulled the provision on seasonal or work-specific employment contract that has a duration of under 12 months.Thus, an employment contract shall be concluded in one of the following types:
- An indefinite-term employment contract;
- A fixed-term employment contract with a duration of up to 36 months.
Thus, from 2021, an employment contract must not be concluded in the type of seasonal employment contract. Conclusion of a seasonal employment contract will be considered an illegal conclusion. Concurrently, in case enterprise and employee want to conclude a seasonal or work-specific employment contract that has a duration of under 12 months, parties may to to conclude a fixed-term employment contract with a duration of up to 36 months.
3. Ensuring the employment contract including major contents
According to Article 21 of the Labor Code 2019 of Vietnam, an employment contract shall have the following major contents:
- The employer’s name, address; full name and position of the person who concludes the contract on the employer’s side;
- Full name, date of birth, gender, residence, identity card number or passport number of the person who concludes the contract on the employee’s side;
- The job and workplace; if the employees work in many different places, the main workplace shall be provided (according to Point b Clause 3 Article 4 of the Decree No. 05/2015/NĐ-CP of Vietnam’s Government);
- Duration of the employment contract: The number of months and days of employment contract execution , time of the employment contract commencement and termination (for fixed-term employment contracts or casual employment contract or piece work); time of the employment contract commencement (for indefinite term employment contract);
- Job- or position-based salary, form of salary payment, due date for payment of salary, allowances and other additional payments;
- Regimes for promotion and pay rise;
- Working hours, rest periods (normal working hours shall not exceed 08 hours per day or 48 hours per week);
- Personal protective equipment for the employee;
- Social insurance, health insurance and unemployment insurance;
- Basic training and advanced training, occupational skill development.
In addition to the above-mentioned contents, enterprises can add some other content to suit the nature and characteristics of the work.
4. Supplementing the provision that an employment contract shall be concluded in the form of electronic data
According to Article 14 of the Labor Code 2019 of Vietnam, an employment contract shall be concluded in the 03 following forms:
- In writing;
- In the form of electronic data;
- An oral contract with a term of less than 01 month.
Thus, from 2021, an employment contract concluded in the form of electronic data shall have the same value as that of a physical contract. It can be seen that the law has created favorable conditions for enterprises and employees to establish labor relations. Therefore, businesses also need to be flexible in communicating contract content in accordance with each form of contract to achieve the highest efficiency.
5. Probationary clause may be added to the employment contract
According to Article 24 of the Labor Code 2019 of Vietnam, an employer and an employee may include the contents of the probation in the employment contract or enter into a separate probation contract.
This provision has been changed compared to the Labor Code 2012. Specifically, according to Article 26 of the Labor Code 2012 of Vietnam, an employer and an employee may reach agreement on the probation and the rights and obligations of the two parties during the probation period. If reaching agreement on the probation, the two parties may enter into a probation contract.
Thus, from 2021, enterprises can add a probationary clause to the employment contracts, instead of having to make a separate probationary contract when drafting an employment contract to reduce procedures when accepting workers.
Ty Na
- Key word:
- Labor Code 2019
