Vietnam: Employers and 05 things you should to know

May I ask who is considered an employer? When shall an employer have the right to unilaterally terminate an employment contract in Vietnam? - Hoang Giang (Binh Phuoc, Vietnam)

Vietnam: Employers and 05 things you should to know (Source: Internet)

1. Who is the employer?

According to Clause 2, Article 3 of the Labor Code 2019, “employer” means an enterprise, agency, organization, cooperative, household or individual who employs other people under agreements. An employer that is an individual shall have full legal capacity.

2. Rights and obligations of the employer in Vietnam

2.1. Employer's rights

Specifically, according to Clause 1, Article 6 of the Labor Code 2019, an employer has the rights to:

- Recruit, arrange and manage and supervise employees; give commendation and take actions against violations of internal labor regulations;

- Establish, join and operate in employer representative organization, occupational associations and other organizations in accordance with law;

- Request the representative organization of employees to negotiate the conclusion of the collective bargaining agreement; participate in settlement of labor disputes and strikes; discuss with the representative organization of employees about issues related to labor relations and improvement of the material and spiritual lives of employees;

- Temporarily close the workplace;

- Exercise other rights prescribed by law.

2.2. Obligations of the employer

according to Clause 1, Article 6 of the Labor Code 2019, An employer has the obligations to:

- Implement the employment contracts, collective bargaining agreement and other lawful agreements with employees; respect the honor and dignity of employees;

- Establish a mechanism for and hold dialogue with the employees and the representative organization of employees; implement the regulations on grassroots-level democracy;

- Provide basic training and advanced training in order to help employees improve their professional skills or change their occupations;

- Implement regulations of laws on labor, employments, vocational education, social insurance, health insurance, unemployment insurance, occupational safety and health; develop and implement solutions against sexual harassment in the workplace;

- Participate in development of the national occupational standards, assessment and recognition of employees’ professional skills.

3. Prohibited acts by employers during conclusion and performance of employment contracts in Vietnam

Employers are not allowed to do the following acts when entering into and performing employment contracts:

- Keeping the employee’s original identity documents, diplomas and certificates.

- Requesting the employee to make a deposit in cash or property as security for his/her performance of the employment contract.

- Forcing the employee to keep performing the employment contract to pay debt to the employer.

(Article 17 of Labor Code 2019)

4. The right of an employer to unilaterally terminates the employment contract in Vietnam

According to Clause 1, Article 36 of the Labor Code 2019, an employer shall have the right to unilaterally terminate an employment contract in one of the following circumstances:

- The employee repeatedly fails to perform his/her work according to the criteria for assessment of employees’ fulfillment of duties established by the employer.

The criteria for assessment of employees’ fulfillment of duties shall be established by the employer with consideration taken of opinions offered by the representative organization of employees (if any);

- The employee is sick or has an accident and remains unable to work after having received treatment for a period of 12 consecutive months in the case of an indefinite-term employment contract, for 06 consecutive months in the case of an employment contract with a fixed term of 12 – 36 months, or more than half the duration of the contract in case of an employment contract with a fixed term of less than 12 months.

Upon recovery, the employer may consider concluding another employment contract with the employee;

- In the event of a natural disaster, fire, major epidemic, hostility, relocation or downsizing requested by a competent authority, the employer has to lay off employees after all possibilities have been exhausted;

- The employee is not present at the workplace after the time limit specified in Article 31 of Labor Code 2019;

- The employee reaches the retirement age specified in Article 169 of Labor Code 2019, unless otherwise agreed by the parties;

- The employee is not present at work without acceptable excuses for at least 05 consecutive working days;

- The employee fails to provide truthful information during the conclusion of the employment contract in accordance with Clause 2 Article 16 of Labor Code 2019 in a manner that affects the recruitment.


5. Cases in which an employer is prohibited from unilaterally terminating an employment contract in Vietnam

The employer is not allowed to exercise the right to unilaterally terminate the labor contract in the cases specified in Article 37 of the Labor Code 2019, specifically as follows:

- The employee is suffering from an illness or work accident, occupational disease and is being treated or nursed under the decision of a competent health institution, except for the cases stipulated in Point b Clause 1 Article 36 of Labor Code 2019.

- The employee is on annual leave, personal leave, or any other types of leave permitted by the employer.

- The employee is pregnant, on maternal leave or raising a child under 12 months of age.

Thanh Rin


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