Decree 152/2020/ND-CP (“Decree 152”) was recently released by the Vietnamese Government, coming into effect from 15 February 2021, and covers foreign individuals working in Vietnam, along with Vietnamese employed by certain foreign employers. This Decree is introduced as part of the implementation of the new Labour Code that came into effect from 1 January 2021 (known as the Labour Code 2019).
Decree 152 is an important document, replacing Decree 11/2016/ND-CP (along with other Decrees), and specifies how employers can employ foreign individuals in Vietnam. It should be noted that the new Labour Code introduces a broader definition of employment than previously, including deeming most “service contracts” as labour contracts, and therefore this may have a significant impact of certain employees and employers.
Foreign Employment Overview
The Labour Code 2019 (Article 151) states that for foreign individuals to work in Vietnam they must:
- Have professional qualifications, skills, experience and good health,
- Not be a person with criminal records, and
- Have a Work Permit (or be eligible for a specific exemption)
Without these, the foreign individual is not permit to work in Vietnam – which includes probation periods (any work is subject to the above).
Decree 152 and Work Permits: The Process
Decree 152 (Article 4) requires that at least 30 days before an employer wishes to employ a foreign individual, they must send a request for approval to hire foreign employees to the Ministry of Labour, War Invalids and Social Affairs (“MoLISA”) or the Provincial People’s Committee, following which a response will be received within 10 working days. This initial approval is referred to as the Demand for Foreign Employees.
If the approval to hire foreign employees is received, employers are required to request a Work Permit be issued at least 15 working days prior to the commencement of work by the foreign employee (Article 11). The application is to MoLISA or the relevant Provincial Department of Labour, War Invalids and Social Affairs (“DoLISA”), together with relevant supporting documents confirming the individual meets the technical requirements for the Work Permit application.
Within 5 working days from the application for the Work Permit being submitted, MoLISA will issued the Work Permit to the foreign individual. The foreign individual is required to sign the employment contract after the date the Work Permit is issued, and prior to commencement of work, and the employer is required to send a copy of the signed contract to the authority issuing the Work Permit.
Work Permit Validity
A Work Permit (Decree 152, Article 10) has a maximum validity of 2 years, but cannot be longer than the employment contract, the assignment in Vietnam or the employers operational license.
Work Permit Requirements
Work Permits are to be issued to individuals that meet the definition of:
- An individual holding a bachelor’s degree or equivalent and at least 3 years’ experience in their field corresponding with the job position/job assignment that they will be appointed in Vietnam; or
- Has at least 5 years’ experience and a practicing certificate in corresponding with the job position that they will be appointed in Vietnam; or
- Falls under a special case subject to decision of the Prime Minister according to a request of MoLISA.
A person in charge of the organisation (ie, the Legal Representative or General Director)
A person directly administering affiliated entities of the employer
- An individual that has been trained in a technical field or another major for at least 1 year and has worked for at least 3 years in their trained field; or
- Holds at least 5 years’ experience corresponding with the job position that they will be appointed in Vietnam.
Documents to Support Work Permit Applications
Article 9 of Decree 152 details the documents that are required to be submitted, which include:
- The required completed Application Form
- Fitness to Work Certificate (Health Certificate) issued within past 12 months, as per Ministry of Health issued guidelines
- A prescribed Police (Criminal) Clearance certificate, not less than 6 months old
- Proof as a manager or executive as prescribed in Article 3;
- Proof as an expert or technical worker as prescribed Article 3, including: degrees, diplomas, certificates, and certification from a foreign organization or enterprise in respect of the number of years’ experience of the expert or technical worker;
- Other proof (pilot license, professional sporting certification, education specifics per Ministry of Education and Training), etc
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- Acceptance for the Demand for Foreign Employees
Exemption from Work Permits
There are a number of categories of foreign individuals that can be exempted from a Work Permit. These are detailed in Article 7 of Decree 152 and Article 154 of the Labour Code. The exemption categories include:
- Owner or capital contributor of a Limited Liability Company with a capital contribution value of at least 3 billion VND.
- Chairperson or a member of the Board of Directors of a Joint Stock Company with a capital contribution value of at least 3 billion VND.
- An intra-company transferee within 11 sectors in the schedule of commitments in services between Vietnam and WTO, including: business services, communication services, construction services, distribution services, educational services, environmental services, financial services, health services, tourism services, recreational and cultural services, and transport services.
- Entering Vietnam to provide professional ODA assistance.
- He/she is granted a communication and journalism practicing certificate in Vietnam by the Ministry of Foreign Affairs as per the law.
- Sent by an international organisation to teach and a United Nations school.
- A volunteer implementing an international treaty.
- Entering Vietnam to hold the position of a manager, executive, expert or technical worker for a period of work of less than 30 days, for a maximum of 3 times a year.
- Entering Vietnam to implement an international agreement to which a central or provincial authority is a signatory.
- A student studying at a foreign school or training institution which has a probation agreement with an agency, organization or enterprise in Vietnam.
- A relative of a member of foreign representative body in Vietnam (ie foreign NGO or similar).
- Holding an official passport to work for a regulatory agency, political organization, or socio-political organization.
- Taking charge of establishing a commercial presence.
- Holding certification by the Ministry of Education and Training as a foreign worker entering Vietnam for teaching and research purposes.
- The Head of the Representative Office or a project (or being otherwise responsible) for a foreign NGO or similar in Vietnam.
- Entering Vietnam for a period of less than 3 months to offer services for sale.
- Entering Vietnam for a period of less than 3 months to handle complicated technical or technological situations that affect or threaten production and business that Vietnamese experts and Foreign experts currently in Vietnam cannot handle it.
- A foreign lawyer who has been granted a law practice license in Vietnam in accordance with the Law on Lawyers.
- Cases under the provisions of an international treaty to which the Socialist Republic of Vietnam is a member.
- Foreigners who marry Vietnamese people and live in the Vietnamese territory.
From the above list of exemptions, foreign individuals in the list that are either 1, 2, 8, 9, 10, 11, 12, 13, 15, 16 & 17 do not require the lodgement or of receipt of the Demand for Foreign Workers.
Certificates of Exemption From a Work Permit
Article 8 of Decree 152 covers the requirement for a Certificate of Exemption from a Work Permit to be issued in most cases, which needs to be applied for with MoLISA and DoLISA 10 days prior to the planned commencement date.
However, a number of categories of exemption are not required to apply for a Certificate of Exemption, but instead need to notify MoLISA or DoLISA 3 days before commencing work. These categories (from the above list) are 1, 2, 8, 11, 16, 18 & 20.
A Certificate of Exemption is valid for a maximum of 2 years.
Work Permit Renewal
(Article 18) At least 5 days but not exceeding 45 days before the expiry date of the worker permit, the employer shall submit an application for renewal of a work permit to MoLISA or DoLISA which issued that work permit.
Revocation of Work Permits
Where the employment ceases per the Law, the Work Permit is automatically revoked, and the Work Permit is required to be returned to MoLISA or DoLISA.
Should the foreign individual fail to comply with Vietnamese Laws, or the employer and employer fail to comply with the Decree, MoLISA or DoLISA can revoke the Work Permit, which will require the Work Permit to be returned.
It should be noted that the Labour Code puts in place strict penalties for both employer and employee when foreign individuals work in Vietnam without a valid Work Permit or exemption, including deportation of the individual.
For more information about the Decree, or any other assistance with Work Permits and labour laws, do not hesitate to contact us.