EMPLOYMENT LAW IN VIETNAM - HIRING IS EASY, FIRING IS NOT
- loanlelawlinkvn
- 4 hours ago
- 3 min read
For many foreign businesses entering Vietnam, recruitment is often seen as one of the easier steps in market entry. Vietnam offers a young, skilled workforce, competitive labor costs, and a growing talent pool.
From a legal perspective, however, employment law is one of the areas where foreign investors most frequently underestimate long-term risk.
Vietnam’s labor regime is employee-protective by design. While hiring is relatively flexible, termination is tightly regulated and procedurally sensitive.
-------------------------------
Employment Contracts Are Not Mere Formalities
Vietnamese law requires written employment contracts with mandatory contents, including:
Job description and workplace
Salary structure and allowances
Working hours and rest time
Social insurance obligations
Using templates from other jurisdictions — or overly generic contracts — often creates gaps that later work against the employer.
In Vietnam, what is not written clearly often cannot be enforced later.
-------------------------------
Probation Is Not a Free Exit
Probation periods are permitted, but they are not unlimited or informal.
Key points often overlooked:
Maximum probation duration depends on job type
Termination during probation must still follow legal grounds
Performance issues must be documented
Assuming that probation allows unrestricted termination is a common — and costly — mistake.
-------------------------------
Termination: Where Most Disputes Begin
Termination of employment in Vietnam is legally sensitive.
Lawful termination generally requires:
A recognized legal ground
Proper notice periods
Strict procedural compliance
In some cases, consultation with employee representatives
Unilateral termination without proper basis often leads to:
Reinstatement claims
Back pay and damages
Labor authority involvement
Procedural mistakes matter as much as substantive reasons.
-------------------------------
Restructuring and Redundancy: High Risk Without Preparation
Business restructuring, downsizing, or role elimination triggers additional obligations:
Detailed labor usage plans
Consultations with internal bodies
Notifications to labor authorities
Foreign investors sometimes treat restructuring as a business decision alone — overlooking the legal steps required to execute it lawfully.
-------------------------------
Work Permits for Foreign Experts: Planning Matters
Employing foreigners in Vietnam requires:
Work permits or valid exemptions
Compliance with position-specific criteria
Alignment between immigration and labor documentation
Delays or inconsistencies can disrupt operations and attract regulatory attention.
-------------------------------
Why Employment Law Becomes a Reputational Issue
Employment disputes in Vietnam often escalate beyond the courtroom:
Labor authorities are actively involved
Disputes may affect licensing and inspections
Employer reputation can suffer locally
For foreign businesses, employment compliance is not only a legal matter — it is part of operational credibility.
-------------------------------
A Practical Legal Lens for Foreign Businesses
From a legal advisory standpoint, employment risk should be managed by:
Investing in compliant contracts from the start
Documenting performance and HR decisions carefully
Seeking advice before termination or restructuring
The goal is not rigidity — but predictability and defensibility.
-------------------------------
Key Takeaway
Vietnam offers flexibility in hiring, but discipline is required when managing and terminating employees.
In Vietnam, employment law rewards preparation — and penalizes shortcuts.
-------------------------------
What’s Next
In the next article, we will explore contracts in Vietnam — and why using templates from other jurisdictions can quietly undermine enforceability.
-------------------------------
Article: Prepared by LLVN.
Image: LLVN
-------------------------------
Lawlink Vietnam (LLVN) is a business law firm providing world-class legal solutions to businesses, entrepreneurs on investment, corporate & business, Mergers & Acquisitions; Litigations and Dispute Resolution. We offer a complete range of consulting services from type of company/investment, operating models, licensing, contracts, capital structure and arrangement, and representation sevices.
-------------------------------
𝐂𝐨𝐧𝐭𝐚𝐜𝐭 𝐮𝐬
Website: www.lawlink.com
Instagram: lawlink.vietnam
Facebook: Lawlink Vietnam
Phone: +84 908107788
Address: Unite 22.02, Aqua 1, Vinhomes Golden River, No. 2 Ton Duc Thang, HCM