Engage In Vietnam

Table of Contents

About Vietnam

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As of March 2024, the estimated population of Vietnam is 98.8 million.


The currency in Vietnam is the Viet Nam Dong (VND). The currency symbol is ₫.

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Vietnam, located in Southeast Asia, is a captivating and diverse country with a rich cultural heritage and breathtaking natural landscapes. Nestled between China to the north and Laos and Cambodia to the west, Vietnam stretches the length of the Indochinese Peninsula. It covers an area comparable to Italy or New Mexico. Its topography combines soaring mountains, fertile deltas, primeval forests teeming with exotic fauna, enchanting rock formations, and stunning waterfalls. The country can be roughly divided into three regions: the north, famous for its alpine peaks, the Red River Delta, and the vibrant capital city of Hanoi; the central region, known for its high plateaus, beautiful beaches, and ethnic minorities; and the south, home to bustling cities like Ho Chi Minh City and the lush Mekong Delta. Vietnam’s history has been shaped by its strategic location as a center of trade and interaction between various cultures. Vietnam’s fascinating past is evident in its ancient temples, historic landmarks, and remnants of colonial architecture. With its warm climate, delicious cuisine, and friendly locals, Vietnam offers an unforgettable travel experience filled with natural wonders and cultural treasures.

Employment Relationship

Permanent Employment

In Vietnam, the provisions for permanent employment are outlined under the designation of indefinite employment. It is defined as a permanent employment contract in which the two parties do not specify the duration and time at which the contract terminates. The Labor Code provides specific benefits for employees with an indefinite term contract – they are entitled to long-term sick leave of 12 months and a notice period of 45 days. If a fixed-term contract continues even after its expiry, it is converted to an indefinite term contract.

Fixed-Term or Specific-Purpose Contracts

Fixed-term contracts are those in which the two parties fix the agreement term for up to 36 months. They can be renewed once for the same duration within 30 days of its expiry. After that, the contract becomes an indefinite term contract if not terminated. If a contract is not renewed within 30 days, but the employee continues to work, it becomes an agreement for an indefinite term. The provisions for fixed-term contracts differ from those of indefinite term contracts. The notice period is at least 30 days for fixed-term agreements of 12 to 36 months and at least 3 days for contracts under 12 months. Fixed-term employees are entitled to long-term sick leave of 6 months.

Temporary Employment Contratcs

In Vietnam, temporary or seasonal work is defined as work performed for a duration of under 12 months. There are no extensive stipulations for temporary work within the Labor Code. Signing a seasonal or specific-job employment contract for a term of under one year for regular work that lasts 12 months or more is prohibited, except to replace an employee temporarily. Employers can utilize labor dispatch agencies to hire temporary employees under a contract for a maximum duration of 12 months. Temporary employees cannot be hired to replace another employee during a strike or settlement of labor disputes. Temporary employees cannot be hired at a lower compensation than comparable permanent employees in the user's company. 

Probationary Period

A probationary period may only be used once per employment contract and is not renewable. Probation is not allowed if the employee works under an employment agreement with a duration of less than 1 month. The duration of probationary period depends on the type of job. Employees must be paid at least 85% of the agreed salary while on probation. During the probationary period, either party has the right to terminate the concluded probation contract or employment agreement without prior notice and compensation obligation.

Working Hours

The regular working hours cannot exceed 8 hours per day (up to 10 for those on a weekly schedule) and 48 hours per week. The working hours of employees under 15 cannot exceed 4 hours per day and 20 hours per week. The statutory hours for a workweek may not be above 48 hours, but the state encourages employers to implement a 40-hour workweek. The working hours of employees under 15 cannot exceed 4 per day and 20 per week. 

Holidays / PTO

Statutory Holidays

There are six public, paid holidays. If the holiday falls on a weekend, employees can take the next weekday off; New Year Eve (January 1st), Tet – Vietnamese New Year (From last day of the last lunar month to 5th day of the first lunar month) (5 to 9 days), Hung Kings’ Commemoration or Death Anniversary of the Hung Kings (10th day of the 3rd lunar month) (2 days), Reunification Day (April 30), International Labor Day (May 1), Independence Day (September 2).

Paid Annual Leave

Employees are entitled to fully paid annual leave after 12 months of service with an employer: 12 working days for employees who work in normal working conditions 14 working days for minors and persons working in heavy or dangerous jobs 16 working days for workers doing extremely heavy or hazardous work Annual leave increases by one day for every five years of employment with the same employer. Employees who have worked for less than 12 months are entitled to paid leave proportional to the number of months worked. In the case of employment termination, job loss, or other reasons, an employee who has not used or not entirely taken their annual leave is entitled to receive compensation for the unused leave days. Employees who work voluntarily during their annual leave are entitled to additional payment to the amount of 200% of their regular income and those who are asked to work by their employers are entitled to 300% of their regular income.

Sick Leave

Annual sick leave (with proof from a doctor) is as follows: 30 days – if contributions to the social insurance fund were made for less than 15 years 40 days – if contributions are between 15 and 30 years 60 days – contributions over 30 years 180 days for extended treatment For those working in heavy or hazardous occupations, the sick leave duration increases by 10 days for every category. Sick leave is compensated by the Social Insurance Agency. Sickness allowance is equal to 75% of the employee's wages. There is also a provision of convalescence leave of 5-10 days, and the sickness benefit during this time is 30% of the basic salary. If the sickness continues even after 180 days of extended leave, the benefit is reduced to 65% of the wages for employees who have paid social security contributions for 30 years or more, 55% for employees who have paid for 15-30 years, and 50% for employees who have paid for less than 15 years. 

Maternity Leave

Employees who have paid social insurance premiums for six months or more within 12 months before childbirth are entitled to six months of paid maternity leave. In the case of multiple births, the mother is entitled to one additional month off for each child from the second child onwards. Maternity leave cannot begin earlier than two months before the expected date of delivery. Employees adopting a child younger than six months of age are entitled to take paid maternity leave until the child turns six months old. Employees are also entitled to paid leave when they experience miscarriage, abortion, or stillbirth. An employee can return to work before the end of the maternity leave period with approval from her employer if she has taken at least four months' leave.

Paternity Leave

Male employees who have paid social insurance premiums for at least 6 months in the 12 months preceding childbirth or adoption are entitled to a fully paid paternity leave as follows: 5 days, under normal circumstances. 7 working days when the wife gives birth to a child requiring surgery or giving birth to a child under 32 weeks old 10 working days, in case the wife gives birth to twins, additional three working days for each infant from the third child onwards 14 working days when the wife has multiple births and requires surgery Fathers are also entitled to 6 months of leave in case of adoption if the mother is not eligible for leave. 

Termination of Employment

Notice Period

An employment contract may be terminated at any time by either party by giving written notice to the other party in advance, as follows: A minimum of 45 days for an indefinite-term employment contract A minimum of 30 days for a definite-term employment contract with a fixed term of 12-36 months A minimum of 3 working days for seasonal work employment contracts or for specific tasks with a duration of under 12 months A party that fails to comply with the notice period provisions is required to pay compensation worth the employee's salary for the remaining notice period from the termination date to the other party. An employee who does not comply with the notice period requirements must pay half a month's salary to the employer.

Severance Benefits

Employees who have worked at the same company for over 12 months are entitled to a severance payment of half a month's salary for each year worked. In the case of redundancy, 1 month's wage is paid for each year of work. Severance benefits are not paid if the employee terminates the contract unilaterally or is dismissed due to misconduct or during probation. 

Social Security


The Social Insurance Law provides retirement benefits to eligible employees. The general retirement age is 60 years for men and 55 years for women with at least 20 years of insurance coverage.   The monthly retirement pension of qualified employees is equivalent to 45% of the average monthly salary, corresponding to 15 years of contributions for females and 20 years for males, plus 2% for each additional year of paying social insurance contributions. The maximum rate of pension is 75%. The amount of the benefit is reduced by 2% for each year the pension is claimed before the insured's retirement age. Employees who have contributions for a period exceeding the number of years corresponding to the 75% pension rate are also entitled to a lump-sum allowance calculated as half a month's salary for each additional year of paid contributions. Employees who have reached retirement age but have not paid the required number of contributions are entitled to a lump-sum retirement grant depending on their average salary and number of contributions made.

Dependents/Survivors Benefit

In Vietnam, survivors of a deceased insured employee are entitled to receive benefits: If the deceased employee had paid social insurance contributions for 15 years or more If the deceased person was on a retirement pension If the death was caused by a labor accident or an occupational disease Eligible survivors include children under 18 years of age, surviving wives over 55 years, husbands over 60 years, and dependent parents.  The monthly survivors pension for each relative is equal to 50% of the basic salary of the deceased employee, or 70% of the basic wage for relatives who have no guardians or parents. In case of death caused by a labor accident or an occupational disease, the deceased employee's relatives are entitled to a lump-sum allowance equal to 36 times the basic salary.

Invalidity Benefit

Under the Social Insurance Law of Vietnam, employees are entitled to disability benefits if they have a disability that decreases their working capacity by 61% or more. The monthly pension is paid as 45% of the average monthly salary, corresponding to 15 years of contributions, plus 2% for men and 3% for women for each additional year of paying social insurance contributions. The pension is reduced by 2% for each year the pension is claimed before the insured's retirement age. The disability pension is replaced with an old-age pension after reaching retirement age. The social insurance scheme also provides coverage in the case of labor accidents and occupational diseases. In case of temporary disability, employees are offered a daily allowance equal to their daily wages until full recovery. For permanent disability, an employee must have at least a 5% decrease in a working capacity to be eligible for benefits. Employees with a 5% to 30% decrease in working capacity receive a lump-sum benefit, while employees with a 31% or more reduction in working capacity receive a monthly pension.  There is a social assistance benefit for people who are severely disabled and do not qualify for a social insurance pension. An allowance of VND 540,000 (Vietnamese dongs) is paid per month to people with severe disabilities, VND 720,00 is paid to people with particularly severe disabilities, VND 900,000 per month is paid to people with extremely severe disabilities or the elderly with a severe disability. 

Taxation of Compensation and Benefits

Personal Income Tax

The tax assessment year runs from January 1 to December 31. Vietnamese residents are taxed on their worldwide income at rates ranging from 5% to 35%; non-residents are taxed only on Vietnamese-source income at a flat rate of 20%. Income from all other sources besides employment is taxed at rates ranging from 5% to 25% for both residents and non-residents. 


Types of Visas

There are multiple visa categories in Vietnam, depending on the purpose of the visit: Official visas (NG1, NG2, NG3, NG4, LV1, LV2, NN1, NN2, NN3) – issued to members of delegations invited to Vietnam, diplomats, consular missions, or NGOs Tourist visas (Dl, TT, VR, SQ) – granted to persons visiting Vietnam for tourism, meeting family members, or medical purposes. Business visas (DT, DN) – issued to business people and investors.  Student visa (DH, HN) – issued to interns, students, conference and seminar attendants Workers visa (LD, PV1, PV2) – issued to those entering Vietnam for short-term employment 

Work Permit

Foreign nationals who wish to work in Vietnam require a work permit issued by the Ministry of Labor, Invalids and Social Affairs. Applicants must provide the following documents: A written request for the work permit from the employer in accordance. A health certificate  Written certification proving that the employee is not a criminal or liable to criminal prosecution  A written certification which confirms that the worker is a manager, executive officer, expert, or technician Valid passport or travel document Written approval for the employment of foreign workers given by the President of the People’s Committee of the province in which the employer is located 2 photographs The maximum duration of a work permit is 2 years, with a possible 2-year extension.

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