Due to Vietnam’s booming economy, foreign companies are increasingly willing to hire employees in Vietnam. When hiring staff overseas, employers should be familiar with the local labor law, NNRoad has prepared a comprehensive guide for foreign companies and employers hiring employees in Vietnam. Keep reading to learn how your company can hire employees in Vietnam.
- Employment Service in Vietnam
- PEO / Employer of Record Services in Vietnam
- Employment Contracts in Vietnam
- Immigration Requirements
- HR and Labor in Vietnam
- Payroll Options in Vietnam
- Payroll Services in Vietnam
- Employment Taxation
- Bonuses, Benefits, and Leave
- Termination and Severance Pay
- Hire Employees in Vietnam with NNRoad
Employment Service in Vietnam
- Engaging employees through local labor contracts including contract administration, engagement, extension termination and conversion to a permanent hire.
- On-boarding and off-boarding employees according to local practice.
- Registration of employees with the social security board and paying all legally required taxes and social contributions for employees.
- Complete payroll solution and mandatory benefit administration.
- Employee management according to local laws, including employee record, timekeeping, bonus and allowance management, expenses and claims, and leave employee database management.
- Payment management, including invoicing customers/clients and salary payment.
PEO / Employer of Record Services in Vietnam
To assist foreign companies, NNRoad provides Employer of Record (EOR) services in Vietnam for clients interested in running payroll and hiring employees in Vietnam without a legal entity.
NNRoad acts as a Professional Employment Organization (PEO) in Vietnam to ensure that all employment liabilities (local contract, payroll, individual income tax, social security contributions) are complied according to the Vietnamese Labor Law. In other words, employees are legally and administratively employed by NNRoad, but they will remain working on your company’s behalf.
This solution enables a quick market entry into the Vietnamese market and avoids the hassle of establishing a subsidiary or branch office in Vietnam.
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Employment Contracts in Vietnam
According to the Vietnamese Labor Code, there are three different types of labor contracts:
- Indefinite term labor contracts (IDT)
- Definite term labor contracts (DT) (from 12 to 36 months)
- Less-than-12-months term labor contracts (“seasonal contracts”)
Employment Contract Requirements
All three of the above types must be in written form and contain these provisions:
- Employee insurance;
- The work that will be performed;
- Occupational Hygiene and safety conditions;
- Work hours and rest hours;
- Contract duration;
- Wages/Salary;
- Work location;
If an employer and an employee have a DT contract relationship, but the employee continues working after the contract is up, the two parties must sign a new labor contract within the 30 days of the expiration of the contract. If the parties do not create a new labor contract, the original DT contract will automatically be considered an IDT contract, continuing employee engagement.
However, there is a provision within Vietnam labor law stating that employers may sign and extend one DT contract per all their employees. After the newly extended DT contract has finished, the parties must then finally enter into a DT contract.
Labor contracts created in Vietnam must not only be following Vietnamese law, but also with the collective labor agreement issued by the relevant company (if one such agreement exists). As the standard employment contract template created by the Ministry of Labor, Invalids, and Social Affairs (DOLISA) lacks provisions protecting employers’ interests, foreign companies hiring employees in Vietnam should create a set of within-company rules that specifies employee regulations and rules (ILR).
If an employer has more than 10 employees, they must issue and register their ILR with DOLISA within 6 months of operation. If a co