Hong Kong: Vietnam - Legal Overview - Employment

Last Updated: 20 November 1995
Most Read Contributor in Hong Kong, October 2018
The laws of Vietnam are complex and new legislation is constantly being introduced. What follows is no more than an introductory overview that we hope will assist investors to decide which areas of law they will need to research further.

This summary is, necessarily, selective and is no substitute for detailed legal advice.

Wide ranging protection for employees is provided by the following legislation:-

- The Labour Code of 23 June 1994 ("The Code")

- Decree 197 CP of 31/12/94: giving further details in respect of wages and bonuses

- Decree 12 CP of 26/l/95: giving further details in respect of Regulations on Social Insurance

- Decree 6 CP of 20/l/95: giving further details in respect of safety and sanitation

- Decree 198 CP of 31/12/94: giving further details in respect of Labour Contracts

- Decree 196 CP of 31/12/94: giving further details in respect of Collective Labour Agreements.

(All together referred to as "The Employment Legislation").

The Code alone has some 198 sections detailing the rights of employer and employee. For the purposes of this section, we highlight only the main features.

It should be noted that the protections of the Employment Legislation apply to both local Vietnamese and expatriates working in Vietnam.

It is not possible to contract out of the terms of the Employment Legislation.

1. Recruitment

1.1 Any Vietnamese wishing to work for a foreign enterprise must obtain a permit to do so from the Ministry of Labour.

1.2 Priority should be given to hiring Vietnamese citizens. Expatriates should only be employed if there are no suitably qualified Vietnamese available.

1.3 Enterprises are required to draw up plans to train Vietnamese workers so that they can replace foreign workers as quickly as possible.

1.4 All employees should be over 18 years of age unless permission is obtained from parents/guardians when employment may commence at age 15.

1.5 Special provisions apply in relation to. junior workers (aged 15-18), senior employees (60 years old for men, and 55 years old for women), the disabled, and those with highly specialised skills.

1.5 Particular protection is given to women employees.

2. Contracts of Employment

2.1 All workers must have a contract of employment which covers the following provisions:

- the nature of the work
- working hours/breaks
-location of the job
-duration of the contract
- employment protection and conditions on safety/hygiene
- provisions relating to health and safety and social security

If an employee is called for Military service or Public service the contract will be suspended for the duration of that service.

2.2 Ordinarily, the Contract must be signed directly by the employer and employee, though an authorised signatory may sign on behalf of a group of workers.

2.3 The contract may take one of three forms:-

(a) a contract for in indefinite term, or
(b) a contract for a defined duration of 1-3 years, or
(c) a seasonal or fixed term contract for less than I year

(Contracts of less than 3 months or relating to domestic servants, may be oral, but still must adhere to the terms of the Code.)

2.4 Trial / probationary Periods are permitted during which the employee must receive a minimum of 70% of the normal wage. The periods permitted are as follows:-

(a) a maximum of 60 days for those educated above secondary /high school level.

(b) a maximum of 30 days for those educated up to secondary /high school level.

(c) a maximum of 6 days for manual labourers.

If the probationary period expires and the employee continues working, the employer shall be deemed to have accepted the employee.

2.5 Any amendments to the terms of the contract must be agreed upon by the employee.

2.6 An employee cannot be prohibited front entering into more than one contract of employment (i.e. with different employers) at a time provided he fulfils all his obligations under his contract.

3. Collective Labour Agreements

These are encouraged by the State particularly where they go beyond the minimum requirements of the Code.
A Collective Agreement must

- be negotiated between a representative of the enterprise and the Labour Union, if either side wishes there to be a collective agreement.

- be approved by a minimum of 50% of the workforce

- be for a period of 1-3 years, (though the initial agreement may be for less than 1 year)

- cover all aspects of employment as with a contract for an individual employee.

4.1 Trade Unions

Employees have a right to form labour unions. Any attempts to prevent the formation of unions is prohibited.

4.2 Within 6 months of the setting up of an enterprise the trade unions for the province in which the enterprise is located must establish a union.

4.3 An employee active in union work must be permitted a minimum of 3 days off per month for such activities.

4.4 The employer is required to co-operate closely with the union at all times.

5.1 Dismissal/Termination

A contract may be terminated
(1) by agreement between the parties;
(2) after the expiry of its term if it is for a fixed duration; or
(3) on the conviction or subsequent imprisonment of an employee.

Termination by the Employee

If an employee wishes to terminate a contract of indefinite term he may do so unilaterally, without any reason, provided he gives the employer 45 days notice. If an employee wishes to terminate a fixed term contract of 1-3 years, he may do so on 30 days notice if-

(a) he is unable to continue to perform the contract for family reasons or
(b) is elected to public office.

He may additionally terminate on 3 days notice due to maltreatment or non-payment by the employer.

No specific reference is made to an employee under an indefinite term contract being permitted to terminate due to the employer's misconduct or to the notice (if any), required in that situation. On the face of it, such an employee must, in any circumstances, give 45 days notice.

Similarly, there is no reference made to an employee being permitted to terminate a contract of I3 years other than for the reasons above. In particular there is no parallel provision to that of an employee being able to give 45 days notice without specifying a reason. In practical terms, however, it is likely that an employee would be able to achieve this result using reason (a) above.

Termination by the Employer

There is no provision for an employer to terminate a contract except in limited and defined circumstances. Simple notice to terminate, however long is not by itself permissible, unless, of course, the employee agrees.

A contract may only be terminated by the employer in limited circumstances.

All other breaches, other than those where the employee is dismissed for defalcation, require discipline in the manner stated in the Code.

Labour Conditions

The employment legislation sets out the requirements in great detail.

Employees in foreign invested enterprises must be paid minimum wages. This is applicable only to the most simple, unskilled jobs.

6. Hours/ Holidays

- standard hours are 8 per day or 48 hours per week. For each 8 hour period there must be a minimum 30 minute break which counts as worked time

- overtime, which commences after the standard hours have been completed, must not exceed 4 hours in one day or 200 hours per year

- Night workers must have a 45 minute break during each 8 hour period.

- shift workers are entitled to a break of 12 hours between shifts

- employees are entitled to 1 full day off per week. If this is impossible, then time off must average 4 days per month

- employees with more than 12 months service must receive between 12 and 16 days paid holiday per year depending on the location, age of employee, and the strenuousness of the work. This is in addition to public holidays.

- if, for any reason, an employee does not take their full holiday entitlement, they are entitled to be paid in lieu.

7. Health and safety

7.1 Employers are obliged to comply with detailed regulations.

7.2 Employees must comply with the rules laid down by the employer, and use safety equipment provided. They have a right to refuse to work if the risk of an accident exists or has not been overcome.

7.3 All labour accidents and occupational diseases must be investigated by the employer in conjunction with the Trade Union representative, and reported to the Ministry of Labour in accordance with their requirements.

7.4 The employer is responsible for the cost of treating an employee injured, through no fault of his or her own in a work related accident or who has contracted an occupational disease. The employer must also pay the levels of compensation set down in the Social Insurance legislation for work accidents and occupational diseases.

8. Inspection

The Ministry of Labour and Ministry of Health may appoint inspectors to review occupational health and safety. They may inspect without warning and have the power to suspend all a part of an enterprise's operations if they are in any way dissatisfied. Decisions of an inspector are binding and must be implemented.

9. Disputes/Strikes

9.1 Direct negotiations between employer and employee should be attempted in the first instance. Trade unions should always be involved in any dispute resolution process. If that fails then:-

9.2.1 For enterprises with more than 10 employees:-

They must establish a Conciliatory Council made up of equal numbers of representatives of the trade Union and Management who must then try to resolve the dispute. Either party may appeal the decision of a Conciliatory Council to the People's Court.

9.2.2 For enterprises with less than 10 employees:-

They must refer the dispute to a single labour conciliator appointed by the local Labour Office. Either party has a right of appeal to the People's Court.

9.2.3 Disputes regarding termination of an employee's contract may go directly to the People's Court.

9.2.4 Collective Labour Disputes

Just as for an individual labour dispute, these should be referred to either the enterprise's own Conciliation Council or a single Labour Conciliator, if direct negotiation fails to solve the matter.

10. Labour Conduct Codes

All enterprises with more than 10 employees must have a written internal code of conduct, formulated after consultation with the Union and registered with the local Labour Office, setting out the rules and regulations in relation to the running of the enterprise. It must comply with the terms of the Employment Legislation.

NOTE: The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

If you would like further advice please contact: David Ellis, Johnson Stokes & Master, 16th Floor, Princes Building, 10 Chater Road, Hong Kong; Tel 2843 4226; Fax no. : 2845 9121. Alternatively do a text search "Johnson Stokes and Master" and "Business Monitor".

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions