After the pandemic, all economic and commercial activities in Vietnam are gradually recovering. In 2023, the amount of foreign investment in Vietnam began to increase rapidly again, leading to an increase in the number of foreign workers entering Vietnam to work. However, not all businesses and foreign workers understand the law on employing foreign workers in Vietnam.
Therefore, through the frequently asked questions below, VTJ will summarize relevant legal issues for businesses and foreign workers to understand.
1. What are the conditions for foreign workers in Vietnam?
What are the conditions for foreigners workers in Vietnam? (Source: Internet)
In order to work in Vietnam, foreign workers must meet the following conditions:
- Being 18 years or older and having full civil act capacity;
- Having professional qualifications, techniques, skills and working experience;
- Have a work permit issued by a competent Vietnamese state agency
- Other conditions as prescribed by law.
Read more: Work Visa Process
2. Are foreign workers in Vietnam allowed to enter into indefinite-term labor contracts with their employers?
Are foreign workers in Vietnam allowed to enter into indefinite-term labor contracts with their employers? (Source: Internet)
Foreign workers are not allowed to enter into labor contracts with indefinite terms because the term of labor contracts for foreign workers in Vietnam must not exceed the term of the work permit. The term of the work permit is 2 years.
3. Can Vietnamese law apply in case a foreign workers in Vietnam but signs a labor contract with an employer in another country?
Can Vietnamese law apply in case a foreigner works in Vietnam but signs a labor contract with an employer in another country? (Source: Internet)
Vietnamese law can be applied to labor relations in case a foreign employee works in Vietnam but signs a labor contract with an employer abroad if:
(1) The International Labor Agreement to which Vietnam is a contracting party contains provisions on the application of Vietnamese law; or
(2) If an international treaty does not contain provisions different from the laws of Vietnam, then the laws of Vietnam shall apply; or
(3) International treaties allow parties to choose applicable law and parties to choose Vietnamese law.
4. When unilaterally terminating the labor contract in accordance with the law, what kind of allowances and benefits does the foreign worker enjoy?
In case the foreign worker unilaterally terminates the contract in accordance with the law, he will be entitled to the following allowances and benefits:
– Severance allowance (if any);
– Salary includes the actual unpaid working day salary, the salary for the annual leave days that the employee has not taken leave and other allowances; and
– The obligation to pay compulsory social insurance, health insurance (“HI”), and unemployment insurance (“UI”) into these insurance funds is performed by the employer; or
– An amount equivalent to the employer’s payment of social insurance, health insurance, and unemployment insurance premium in case the employer has not yet paid this amount in addition to the same salary payment period for the employee during the working period.
Read more: The Difficulties When Finding English Teaching Jobs In Vietnam
5. When the employer unilaterally terminates the labor contract in accordance with the law, what kind of allowances and benefits does the foreign employee enjoy?
– In case the employer unilaterally terminates the contract in accordance with the law, the foreign employee will be entitled to the following allowances and benefits:
– Severance allowance (if any);
– Salary includes the actual unpaid working day salary, the salary for the annual leave days that the employee has not taken leave and other allowances; and
– The obligation to pay compulsory social insurance, health insurance and unemployment insurance premiums to these insurance funds is performed by the employer; or
– An amount equivalent to the employer’s payment of social insurance, health insurance and unemployment insurance premium in case the employer has not yet paid this amount in addition to the same salary payment period for the employee during the working period.
6. When a foreign worker unilaterally terminates a labor contract illegally, what obligations must he bear? In this case, do they get any benefits or not?
The foreign worker illegally terminates the labor contract unilaterally if he fails to notify the employer in advance. Such foreign workers in Vietnam will have to bear the following obligations:
– Not entitled to severance pay;
– Compensation to the employer for half a month’s salary according to the labor contract;
– Compensation for an amount corresponding to the salary according to the labor contract in the days without notice; and
– Must reimburse the employer for training costs (if any).
However, in this case, the foreign worker still has the right to claim other benefits that belong to his or her basic interests, such as:
– Salary includes the unpaid actual working day salary, the salary for the annual leave that the foreign employee has not taken leave and other allowances; and
– An amount equivalent to the employer’s payment of compulsory social insurance, health insurance and unemployment insurance in case the employer has not yet paid this amount to the foreign employee during the working period.
7. When the employer illegally terminates the labor contract unilaterally, what kind of allowances and benefits are the foreign workers in Vietnam entitled to?
The employer illegally terminates the labor contract unilaterally if (i) there are no grounds for the unilateral termination of the labor contract and/or (ii) the notice period is violated. At that time, foreign workers in Vietnam will enjoy the following allowances and benefits:
In case the employer agrees to accept the foreign worker back to work, the foreign worker will receive the following benefits:
– Wages for the days the foreign worker is not allowed to work;
– To pay social insurance and health insurance premiums for the days the foreign employee is not allowed to work;
– Pay an additional amount equal to at least 02 months’ salary according to the labor contract;
– An amount equivalent to the salary according to the labor contract for unannounced days in case of breach of notice obligation.
In case the foreign worker does not want to continue working, in addition to the amounts specified in item a, the foreign worker is also entitled to an additional severance allowance.
In case the employer does not want to take back the foreign worker and the foreign worker agrees, in addition to the amounts in items a and b above, the foreign worker is also entitled to an additional compensation equal to at least two months’ salary under the labor contract.
8. Can foreign workers in Vietnam work for more than one employer at a time?
Can foreign workers in Vietnam work for more than one employer at a time? (Source: Internet)
– The Labor Code allows employees to enter into many labor contracts with many employers but must ensure the full implementation of the signed contents. For foreign workers, they must have a work permit corresponding to each employer they work for.
9. Foreign workers who have paid insurance in foreign countries according to the regulations of that country, can they deduct this part of insurance when finalizing tax in Vietnam?
– Foreign employees working in Vietnam will be deducted the insurance premiums paid abroad when finalizing personal income tax (“PIT”) on salaries and wages if the following conditions are met:
– The compulsory insurance paid must be similar to the provisions of Vietnamese law such as social insurance, health insurance, unemployment insurance, compulsory professional liability insurance, and other compulsory insurances (if any); and
– Must have proof of participation in paying the above insurance.
10. Foreign workers in Vietnam who voluntarily contribute to the retirement pension fund of the social insurance agency for a period of 20 years will be entitled to a pension when they reach the prescribed retirement age.
In fact, in case a foreigner voluntarily contributes to the retirement pension fund, the social insurance agency will refuse to collect this amount because the foreign worker is not eligible to participate in voluntary social insurance.
Moreover, before January 1, 2022, foreign workers are also not eligible to contribute to the retirement and survivorship fund, but from January 1, 2022, onwards, foreign workers in Vietnam are the subjects to contribute to the retirement and survivorship fund. If the foreign employee fully contributes to the retirement pension fund for at least 20 years from January 1, 2022, he/she will be entitled to a pension in accordance with the law.
11. When terminating the labor contract with the employer, does the term of the work permit automatically terminate?
One of the cases causing the work permit to expire is the termination of the labor contract. Therefore, when the labor contract is terminated, the labor license is automatically terminated.
12. If the foreign worker is the head of a representative office in Vietnam and receives a salary from a foreign company, who will be responsible for declaring and finalizing tax for this person?
Foreign employees are obliged to declare PIT quarterly and finalize PIT according to regulations. See more about representative offices of foreign traders here.
13. Are there any regulations restricting the rights of foreign workers when working in Vietnam?
Are there any regulations restricting the rights of foreign workers when working in Vietnam? (Source: Internet)
Are not. Vietnamese law does not have specific provisions on limiting the rights of foreign workers when working in Vietnam. However, in order to work in Vietnam, foreign workers must meet the conditions under Vietnamese law to be able to carry out the procedures for applying for a work permit if they are not eligible for a work permit.
At the same time, foreign workers in Vietnam are only allowed to work in positions such as manager, executive, expert, and technical worker Vietnamese workers cannot meet according to production and business needs.
14. Do foreigners entering Vietnam to teach at English centers need to sign a labor contract? In this case, do I need to apply for a work permit?
Foreign workers in Vietnam working in the field of education can agree to sign contracts that are not required to be labor contracts according to regulations.
However, in this case, the foreign worker still has to apply for a legal work permit and must provide the contract or agreement signed between the Vietnamese side and the foreign side about sending the foreign worker to work in Vietnam or the contract between the foreign worker and the foreign worker. and Educational Institutions in Vietnam.
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