Employer of record in Vietnam: costs, rules and how to hire
Hire someone in Vietnam without opening your own Vietnamese company.
An employer of record (EOR) can handle local employment while you manage the person’s work. Start by confirming the provider’s coverage and the arrangement available for your specific hire.
By Employ Borderless · We help you understand and compare EOR services.
How does an employer of record in Vietnam work?
Three parties, two contracts: the EOR employs the person under a local employment contract, your company signs a service agreement with the EOR and directs the day-to-day work. Which arrangement is legal and sensible in Vietnam is decided by the questions below.
Your company
Choose the person, agree their role and manage their daily work.
The employer of record
Handles the agreed employment, payroll and HR services through the employing entity named in your contract.
Your employee
Works with your team under a local employment contract with the EOR’s employing entity.
- Do you already have an entity in this country?
- How many people are you hiring, and for how long?
- Is the work genuinely independent, or is it a job?
- Who carries the employment risk if the arrangement is challenged?
What each route means in full
- Your own entity
- Choose it when: You already have a company here, or you are committing to a substantial local team for the long term.You become the legal employer. You arrange payroll, benefits, filings and employment support yourself, and you carry the setup and running cost.
- Employer of record
- Choose it when: You have a person to hire here, want them employed properly, and do not want to open a company for it.The provider is the legal employer through its own entity. You direct the work and pay one invoice covering salary, employer costs and the service fee.
- Independent contractor
- Choose it when: The work is genuinely independent: their own business, their own methods, their own clients.A contract for services, not employment. The label does not decide the status; how the person actually works does, and getting it wrong is reclassified after the fact.
Hiring in Vietnam: the short version
The surprise in Vietnam is that the arrangement most providers sell has a time limit written into the law. Where the arrangement is labour dispatch, the agency needs the required licence, the work must be a permitted type and an employee's dispatch period cannot exceed 12 months. The Labour Code also limits when a client may use dispatched labour. An EOR label does not make every role eligible or allow an indefinite assignment, so ask what happens in month 13 before you sign anything.
The cost side is heavy by regional standards. Vietnam ranks 4th of 192 on the 2026 Employer Burden Index with a composite of 82.6, because standard employer insurance runs to 21.5% of the contribution bases and the employer union contribution of 2% sits on top of it. Exit costs are far milder, at 58th of 190 on the Termination Cost Index with a composite of 49.2 and about 15.1 weeks of total cost.
Your first hire in Vietnam in five decisions
Five things settle a Vietnamese hire, and the figures behind each are worked through further down this page.
- Entity or EOR. Whether the provider's model is labour dispatch, which needs a licence, a permitted work type and an assignment no longer than 12 months.
- Employee or contractor. The Labour Code looks for paid work, wages and one party's management, direction or supervision, whatever the agreement is called.
- Budget line. Employer insurance of 21.5% on covered bases, plus a separate 2% union contribution on the social-insurance salary fund.
- Notice reality. 45 days on an indefinite contract, 30 on a fixed term of at least 12 months, with severance at half a month per qualifying year.
- Realistic start. After the work permit for a foreign hire, where the authority has ten working days to decide on a complete dossier.
EOR, entity, or contractor in Vietnam?
In Vietnam the model question comes before the price question, because the law regulates who may supply labour and for how long.
Check whether the arrangement fits the role
An employer of record employs your hire and administers agreed contracts, payroll and benefits while your team directs the work. In Vietnam that setup needs a legal-model check, because labour dispatch is a regulated activity. Ask which Vietnamese entity employs the person, what authorisation it holds and whether the proposed role and assignment can lawfully use that arrangement.
Where the arrangement is labour dispatch, the agency needs the required licence, the work must be a permitted type and an employee's dispatch period cannot exceed 12 months. The Labour Code also limits when a client may use dispatched labour. An EOR label does not make every role eligible or allow an indefinite assignment, so resolve the actual model before signing.
Compare the complete cost and responsibilities
Work the numbers on a real salary rather than a percentage. For a covered Vietnamese employee earning VND 30,000,000 a month, assume the full amount is the base for each contribution, the standard 0.5% accident rate applies and no relief is available. Employer insurance is VND 6,450,000 and the separate 2% union contribution is VND 600,000. The subtotal is VND 37,050,000 a month before EOR fees, additional benefits, equipment, overtime, bonuses and exit costs. The employee's VND 3,150,000 insurance deduction comes out of gross pay, and income tax is calculated separately.
Compare the provider's full quote with the setup and ongoing work of employing directly, considering the intended assignment length, plans for the business, local management and ability to administer payroll. There is no fixed employee count at which a local entity automatically becomes the better option.
Ask the provider to explain how it would handle the assignment reaching its legal limit, a missed payroll payment or the client project ending, and record the agreed contacts, responsibilities and charges before signing.
Read this in full under “Keep responsibilities clear as work changes”.
Moving from an employer of record to your own Vietnamese entity
Setting up the employing entity is the long pole in Vietnam, so start it well before you want anyone moved, and expect the insurance registrations and, for a foreign national, the work permit reissue to follow rather than run in parallel.
Settle in writing before the move: whether service with the provider counts towards the severance allowance and the leave entitlement, both of which build with service; how accrued leave is settled; how the social, health and unemployment insurance books are transferred; and how a work permit reissue is sequenced so the person is never working without permission.
I have not read a Vietnamese government source on continuity of service on a change of employer in this pass, so I am not going to state a rule. Put it to a Vietnamese adviser, and ask the provider what notice the service agreement requires, who pays the severance allowance if the employment ends rather than transfers, and what insurance and payroll records they will hand over.
How to hire employees in VN
Three routes are open, and in Vietnam the second column of the table below is where most of the risk sits.
Work through the hiring steps
Step two is the one that decides whether the rest of the plan is possible.
| Step | What to do |
|---|---|
| 1. Confirm the role and workplace | Record the duties, work address, schedule, nationality and right to work |
| 2. Check the provider's arrangement | Identify the legal employer and verify that the proposed role and assignment fit its authority |
| 3. Agree the offer and budget | Set salary, pay dates, leave, benefits, overtime and the full employer cost |
| 4. Complete the employment setup | Sign the terms, register the relevant insurance and payroll details, and arrange equipment and workplace policies |
| 5. Confirm the start and contacts | Agree who handles payroll changes, leave, concerns, work-location changes and employment exits |
Set the start date after the provider checks the documents, payroll cutoff and any work-permit process. There is no universal three-day timetable for every Vietnam hire.
Read this in full under “Check permission for a foreign employee to work”.
How long the first hire takes, and what sets the date
The insurance registrations set the date in Vietnam, and for a foreign national the work permit and the labour-market justification behind it take over entirely.
So rather than a number of weeks, here is the sequence, in the order the steps actually gate each other. Work backwards from whichever one is unresolved in your case, because that is the one holding your date and the rest will not be.
- Agree the offer and the written contract in the form the Labour Code requires, and settle the contract type, since fixed-term and indefinite carry different consequences.
- For a foreign national, work through the work permit and residence steps, which is the critical path and is measured in months.
- Have the employing entity register the person for social, health and unemployment insurance.
- Arrange the occupational health and safety steps the role requires.
- Land the start date on the payroll cut-off so the first month and the leave accrual begin in the cycle you expect.
Ask which contract type the provider will use and why. In Vietnam the contract type decides what happens at the end, and that decision is made at the start.
What should you budget for hiring in Vietnam?
Your budget includes salary, employer contributions, agreed benefits and the EOR fee. Ask for a quote for the actual role and salary.
- Gross salary
- Employer contributions
- Benefits and other costs
- EOR service fee
- Gross salary: 100
- Employer social contributions: 21.5%
- Benefits and EOR fee: quoted per hire
The numbers behind this figure
| Cost | Amount |
|---|---|
| Gross salary | 100 |
| Employer social contributions | 21.5% |
| Benefits and EOR fee | Quoted per hire |
Source: Employ Borderless research, 2026
Published EOR base fees among providers covering Vietnam range from $49.99 to $699 per employee/month. These are provider base prices, not a quote for this hire or the total employment cost.
Employer contribution benchmarks · 2026
These stored OECD benchmarks help with initial planning. Earnings ceilings, employee circumstances and later changes can affect the actual charge; use the EOR’s itemised quote for your budget.
| Contribution | Rate |
|---|---|
| Social insurance | 17.5% |
| Health insurance | 3% |
| Unemployment insurance | 1% |
| Trade union fee | 2% |
Separate employer costs from employee deductions
Six lines make up the picture, and only the last one is easy to forget.
| Contribution | Standard employer share | Standard employee share |
|---|---|---|
| Retirement and survivor insurance | 14% | 8% |
| Sickness and maternity insurance | 3% | No separate employee share |
| Occupational accident and disease insurance | 0.5%; approved reductions can apply | No employee share |
| Health insurance | 3% | 1.5% |
| Unemployment insurance for covered Vietnamese workers | 1% | 1% |
| Employer union contribution | Generally 2% of the compulsory social-insurance salary fund | Separate from employee union membership fees |
For an ordinary covered Vietnamese employee, standard employer contributions total 21.5% of the relevant contribution bases: 14% retirement and survivor insurance, 3% sickness and maternity, 0.5% occupational accident and disease insurance, 3% health insurance and 1% unemployment insurance. The separate employer union contribution is additional. Caps, coverage and approved reduced rates can change the actual amount, so 21.5% is not a universal percentage of every employee's full salary.
On the employee side, payroll generally deducts 8% retirement and survivor insurance, 1.5% health insurance and 1% unemployment insurance, so 10.5% before income tax. Apply each contribution's coverage and cap. These deductions come from the employee's pay and should not be added a second time to the employer's cost.
The ordinary employer contribution to occupational accident and disease insurance is 0.5% of the compulsory social-insurance salary base. A 0.3% rate is available only for enterprises meeting the specified conditions and approval process, so check the provider's actual rate and cover rather than assuming the reduction applies to every office-based hire.
The statutory employer union contribution is generally 2% of the salary fund used for compulsory social insurance. Keep it separate from the 21.5% standard employer insurance total and from employee union membership fees. Exemption, reduction or temporary suspension depends on the legal conditions, so do not assume a provider can opt out.
What an employer of record adds to the employment cost
Budget the provider fee as a third line, next to gross pay and the employer contributions above. Across the market it runs from $99 to $799 per employee per month, or 8 to 20% of salary, and where a quote sits in that range is decided by the work rather than by the country: headcount, how much of the administration you hand over, and whether the provider is pricing a single hire or a team. I treat a quote at the bottom of the range as a question rather than a win, because the cheap number is usually the one with the fewest things inside it.
What the fee buys is the employment itself: the employing entity, the payroll run, the filings and the employer-side administration. What it does not buy is the cost of employing the person. Gross pay, the employer social, health and unemployment insurance contributions and the severance allowance are yours, and the contribution bases are capped, so a flat percentage overstates the cost for a well-paid hire and understates the administration. Ask for a quote that separates the fee from the pass-through costs, priced in dong, because a single blended figure hides which half moves when pay changes.
Average salary in Vietnam by occupation
Gross monthly earnings of employees per ISCO-08 occupation group, in VND, from the ILO's official labour statistics. These stored survey figures for Vietnam have reference year 2024. Use these survey earnings to benchmark an offer before an EOR quote turns it into total employer cost.
| Occupation group | Monthly (VND) | Approx. USD |
|---|---|---|
| All occupations | 8,579,562 | $355 |
| Managers · ISCO 1 | 13,968,721 | $578 |
| Professionals · ISCO 2 | 11,938,149 | $494 |
| Technicians and associate professionals · ISCO 3 | 10,018,383 | $415 |
| Clerical support workers · ISCO 4 | 9,085,476 | $376 |
| Service and sales workers · ISCO 5 | 7,256,173 | $300 |
| Skilled agricultural, forestry and fishery workers · ISCO 6 | 6,222,394 | $257 |
| Craft and related trades workers · ISCO 7 | 8,147,159 | $337 |
| Plant and machine operators and assemblers · ISCO 8 | 8,689,595 | $360 |
| Elementary occupations · ISCO 9 | 6,351,260 | $263 |
Source: ILOSTAT, the International Labour Organization's statistics database (average monthly earnings of employees, both sexes), reference year 2024.
How to hire through an EOR in Vietnam
- Step 1
Define your hire
Prepare the role, work location, salary, working hours and target start date.
- Step 2
Confirm the local hiring route
Ask the provider to confirm that its employing arrangement fits this role and location, including any restrictions.
- Step 3
Review the full quote and contract
Check the legal employer, total costs, benefits, responsibilities and exit terms before signing.
- Step 4
Complete onboarding
Coordinate employment documents, required checks, equipment and the payroll cut-off with the EOR.
- Step 5
Keep employment changes coordinated
Manage the work and tell the EOR about proposed pay, leave, contract or termination changes before they take effect.
What should the EOR arrange before your hire in Vietnam starts?
Confirm the employment terms, work eligibility, payroll and pension arrangements before the start date. Ask which local rules and agreements apply to your employee.
What catches employers out in Vietnam
The first row below is the one that has caught the most people, because it is a limit on the arrangement rather than on the employee.
Resolve these points before signing
Ask the provider to answer each of these against the actual role and workplace.
| Issue | What to do |
|---|---|
| EOR marketing can overlook dispatch limits | Check the actual entity, licence, permitted work and assignment duration |
| Regional wages and contribution caps are different | Use the workplace's minimum wage and the correct cap for each insurance programme |
| Employee deductions can be counted twice | Separate deductions from the employer's insurance, union contribution and provider fee |
| Older leave guidance misses July 2026 changes | Check the qualifying second-child rules before calculating maternity or paternity leave |
| A proposed holiday arrangement can look final | Distinguish the enacted 24 November holiday from proposed workday swaps |
| Ending the client project does not end every obligation | Confirm a lawful employment exit, notice, final pay and any allowance |
Check the facts behind this guide
We check selected sources monthly and review relevant changes before updating the guide, and fact notes show the source, review date and applicable period. A successful fetch does not verify a legal claim, because a first-half earnings release, a July payroll change and an older provision may all be reviewed on the same day. Unresolved source or interpretation issues remain visible for follow-up.
The national earnings figure covers wage and salary workers in the first half of 2026. It is not an annual salary estimate or a quote for a specific job. Official source notes below keep that statistical period separate from the date we reviewed the guide.
What types of employment contracts exist in VN?
Vietnam expects a written contract and caps how long you can keep someone on a fixed term, so the contract type is a decision rather than a formality.
Write the terms for the person and role
Use a written employment contract, subject to the Labour Code's limited exceptions. Include the legal employer and employee, job and workplace, term, salary and payment arrangements, working time, rest, protective equipment, insurance and training terms. Agree wording the employee understands, because a Vietnamese or bilingual version helps both sides check the terms. Do not assume that an English document is automatically void or that a provider template fits every role.
Vietnam recognises indefinite contracts and fixed-term contracts of no more than 36 months. If work continues after a fixed term ends, the parties generally have 30 days to sign a new contract, and otherwise it becomes indefinite. Normally only one further fixed-term contract is allowed before an indefinite contract is required, and statutory exceptions include foreign workers, so check the person's category before applying the general renewal limit.
Set a lawful probation period
Probation is limited to one period for the same job: up to 180 days for specified enterprise executives, 60 days for work requiring college qualifications or above, 30 days for specified technical or vocational work, and six working days for other work. Pay must be at least 85% of the agreed job salary. No probation applies to a contract shorter than one month, and during probation either side may end the arrangement without notice or compensation.
Check the actual working relationship
An agreement can be an employment contract even if it has another name, because the Labour Code looks for paid work, wages and one party's management, direction or supervision. Use a contractor arrangement only after checking how the work will actually be performed. Calling someone a freelancer does not remove employment duties where those features exist.
Use the current electronic-signing rules
Electronic employment contracts can have the same legal value as paper contracts. Decree 337/2025 sets requirements for identity checks, digital signatures, timestamps and the eContract service used. The electronic-contract rules apply from 1 July 2026, and compliant providers send the contract to the government platform within 24 hours of the final signature. Paper contracts remain possible, so this is not a requirement to replace every contract with an electronic one.
Protect confidential information and clarify ownership
For work directly involving business or technology secrets, the Labour Code permits a written agreement covering protection, duration, rights and compensation for breach. Describe the information and work being protected. For an EOR hire creating software, designs or other material, also document the rights the employer receives and the written transfer or licence your business needs. Review any post-employment restriction separately, because there is no safe universal one-year non-compete rule to copy.
Employees have rights to join and participate in employee representative organisations and collective bargaining under the Labour Code. Check whether a collective agreement binds the employing entity or workplace and preserve any applicable terms that improve on the statutory floor. An EOR arrangement does not remove representation rights or make every sector agreement automatically applicable.
Misclassification risk, and the three features the Labour Code looks for
Vietnam says explicitly that the name does not decide the question, which saves much of the argument. An agreement can be an employment contract even if it has another name: the Labour Code looks for paid work, wages, and one party's management, direction or supervision. Source: the approved Vietnamese contractor-status guidance, Labour Code via the government gazette, checked 18 September 2026.
Those three features are worth testing one at a time, because the third is the only one in doubt in most arrangements. Paid work and wages are present in any engagement; management, direction or supervision is what separates a service from a job. Source: the approved Vietnamese contractor-status guidance, checked 18 September 2026.
What a hirer does about it: use a contractor arrangement only after checking how the work will actually be performed, and accept that calling someone a freelancer does not remove the employment duties where those features exist. In Vietnam the practical risk compounds for a foreign national, because a person working as an employee without the right permission has an immigration problem as well as a classification one.
What taxes and social contributions apply in VN?
Standard employer insurance is 21.5% of the relevant bases and the union contribution adds 2% on top, which is why Vietnam sits 4th of 192 on the 2026 Employer Burden Index with a composite of 82.6.
Apply the correct bases and ceilings
For employer-set wages, the compulsory social-insurance base includes pay for the job or title, salary allowances and other supplements agreed to be paid regularly and consistently each pay period. It is not automatically the lowest regional wage or the employee's entire take-home pay. Have payroll identify the included components before applying rates and caps.
The reference amount is VND 2,530,000 a month from 1 July 2026, and the compulsory social-insurance ceiling is 20 times that amount, VND 50,600,000 a month. Covered employee health contributions use the compulsory social-insurance salary base, while unemployment insurance has a different ceiling of 20 times the applicable regional monthly minimum. Do not use the old VND 46,800,000 social-insurance ceiling for payroll after June 2026.
Foreign employees on qualifying fixed-term contracts of at least 12 months are covered by compulsory social insurance and the corresponding health-insurance category, subject to exclusions such as qualifying intra-company transfers, retirement age at contract signing and applicable treaties. Vietnam's unemployment-insurance regime covers Vietnamese workers, so for a foreign employee covered by standard social and health insurance the usual shares are 20.5% employer and 9.5% employee on covered bases, before the separate employer union contribution.
Example: VND 30 million gross a month
This example assumes the full salary is the base for each contribution, the standard accident rate and no relief.
| Illustrative item | Monthly amount |
|---|---|
| Gross salary | VND 30,000,000 |
| Employer insurance at standard rates | VND 6,450,000 |
| Employer union contribution | VND 600,000 |
| Subtotal before provider fees and additional costs | VND 37,050,000 |
| Employee insurance, deducted from gross pay | VND 3,150,000 |
Employer insurance is VND 6,450,000 and the separate 2% union contribution is VND 600,000, so the subtotal is VND 37,050,000 a month before EOR fees, additional benefits, equipment, overtime, bonuses and exit costs. The employee's VND 3,150,000 insurance deduction comes out of gross pay, and income tax is calculated separately.
Calculate resident income tax after deductions
Resident employment income runs on a five-band monthly scale after deductions.
| Monthly taxable-income slice | Rate |
|---|---|
| Up to VND 10 million | 5% |
| Above VND 10 million to 30 million | 10% |
| Above VND 30 million to 60 million | 20% |
| Above VND 60 million to 100 million | 30% |
| Above VND 100 million | 35% |
Each rate applies to the slice in that band, and taxable income is calculated after the allowed deductions, so the top rate does not apply to the whole gross salary.
For resident employment income, the personal deduction is VND 15.5 million a month and the deduction for each qualifying dependant is VND 6.2 million a month, with a dependant claimable only once by one taxpayer. Eligible compulsory insurance and other permitted deductions also affect taxable income. Confirm eligibility and payroll documentation instead of estimating net pay from a single flat tax rate.
The tax-residence test includes presence for at least 183 days in a calendar year or a consecutive 12-month period from first arrival, and a separate regular-residence test. Residents are generally assessed on worldwide taxable income, while non-resident employment income for work performed in Vietnam is generally taxed at 20%, wherever it is paid. Check the person's full circumstances and any treaty before setting payroll treatment.
Current government guidance under Decree 253/2026 uses progressive withholding for residents with employment contracts of at least three months. For residents without a contract or with one shorter than three months, qualifying payments of at least VND 5 million per payment generally attract 10% withholding, subject to the permitted declaration and other conditions. This is a withholding mechanism rather than a replacement for the employee's final annual tax calculation.
Ask the EOR for the employee's actual contribution bases, insurance category and tax-residence assessment, and keep the provider fee, extra benefits and possible exit charges beside the statutory calculation so you can compare complete quotes.
What are the working hours and overtime rules in VN?
The overtime ceiling is 40 hours a month and 200 a year, and the higher 300-hour figure that circulates is an exception rather than the default.
Set a schedule that fits the legal limits
Normal working time is generally capped at eight hours a day and 48 hours a week. Where the employer arranges working time on a weekly basis, normal hours may reach ten a day while staying within 48 a week, and the law encourages a 40-hour week. Set the actual schedule in the contract and check overtime before agreeing extended hours or overseas time-zone coverage.
Ordinary overtime requires the employee's consent. It is generally limited to 50% of normal daily hours, and under a weekly schedule normal work plus overtime cannot exceed 12 hours a day. The limit is 40 overtime hours a month and 200 a year, with up to 300 a year only in specified cases and with the required notification. Emergency provisions are separate, so do not treat 300 hours as the default for every hire.
Budget for overtime and night work
Night work carries its own premium, and overtime at night stacks three components rather than one.
| Work pattern | Minimum pay rule |
|---|---|
| Overtime on an ordinary workday | 150% of the applicable wage |
| Overtime on a weekly rest day | 200% of the applicable wage |
| Overtime on a public holiday or paid-leave day | 300%, excluding the holiday or leave pay owed to day-paid employees |
| Night work, 10pm to 6am | At least an extra 30% |
| Overtime at night | Overtime and night additions, plus the further 20% daytime-wage component |
The minimum overtime rates are 150% of the applicable wage on ordinary workdays, 200% on weekly rest days and 300% on public holidays or paid-leave days, with the 300% excluding the holiday or leave pay owed to employees paid by the day. Record the day type, hours and pay basis so payroll calculates the correct amount.
Night work runs from 10pm to 6am and attracts at least a 30% wage premium. Overtime at night requires the overtime pay, the night-work addition and a further 20% of the applicable daytime wage for that type of day. A flat overtime percentage alone can underpay someone working late for an overseas team.
Record breaks and remote working arrangements
An employee working at least six hours a day gets a break of at least 30 consecutive minutes, or 45 minutes for night work, and for a continuous shift of at least six hours that break counts as working time. Allow at least 12 hours between shifts and 24 consecutive hours of weekly rest, and where the work cycle prevents weekly rest the law requires an average of at least four rest days a month.
Agree the work location, working hours, equipment, expenses, data access and how the employee reports overtime or concerns. Remote work remains subject to employment, pay, rest and safety duties. A move within Vietnam can change the regional wage check, while a move across borders needs a fresh employment, tax and immigration review, and an EOR contract does not itself give permission to work in another country.
Have the employee and manager agree how overtime is requested and recorded. Overseas meetings should fit the agreed schedule or be handled through the applicable overtime process.
How does termination and severance work in VN?
Vietnam ranks 58th of 190 on the 2026 Termination Cost Index with a composite of 49.2 and about 15.1 weeks of total cost, so the exit is affordable provided the ground is lawful.
Confirm the legal route before announcing an exit
Employer termination must fit a legal ground and follow its procedure. Examples include documented repeated failure against properly established performance criteria, specified prolonged illness and certain unavoidable reductions after required measures. Separate rules cover contract expiry, agreement, redundancy and disciplinary dismissal, and pregnancy, maternity, approved leave and other protected circumstances restrict employer action. An end to the client's project is not automatically a lawful dismissal of the employee.
For ordinary lawful unilateral termination, the employer generally gives at least 45 days of notice for an indefinite contract, 30 days for a fixed term of at least 12 months, and three working days for a fixed term shorter than 12 months. Termination on the specified prolonged-illness ground uses three working days. Special occupations and grounds have different rules, and giving notice alone does not create a lawful reason to dismiss.
An employee may generally resign with 45 days of notice on an indefinite contract, 30 days on a fixed term of at least 12 months, or three working days on a shorter fixed term, with separate rules for special occupations. The Labour Code allows resignation without notice in specified cases, including certain failures to provide agreed work or pay, maltreatment and workplace sexual harassment. Review the reason before treating a departure as unlawful.
Calculate the applicable allowance
Two different allowances exist and they are not interchangeable.
| Payment | General basis | Key condition |
|---|---|---|
| Ordinary severance | Half a month's salary per qualifying service year | Specified lawful endings after at least 12 months; exclude unemployment-insured and previously compensated periods |
| Statutory job-loss allowance | One month's salary per qualifying year, minimum two months | Qualifying redundancy situations after at least 12 months, with the required process |
| Untaken annual leave | Pay for the unused entitlement | Settle the recorded balance on termination |
| Unlawful termination remedies | Can include reinstatement, back pay, contributions and at least two months' salary | Depends on the breach and how the relationship is resolved |
For specified lawful endings after at least 12 months of regular work, severance is half a month's salary for each qualifying year. Deduct periods covered by unemployment insurance and periods already paid severance or redundancy allowance, and use the average contractual salary over the last six months. Lawful resignation and contract expiry can qualify, so severance is not automatically excluded whenever an employee resigns.
Structural, technological or qualifying economic changes can require an employment-use plan, consultation and notice to the provincial People's Committee and employees. Where the statutory job-loss allowance applies after at least 12 months of regular work, it is one month's salary per qualifying year, with a minimum of two months, and qualifying service excludes unemployment-insured time and previously compensated periods. This is separate from ordinary severance.
Complete final pay and documents
The parties generally have 14 working days from termination to settle payments relating to their rights and interests, with specified situations permitting an extension of no more than 30 days. Include outstanding wages, untaken annual leave and any applicable allowances. The employer must complete insurance-record procedures and return retained original documents, and the old seven-day deadline no longer applies.
An employer that unlawfully terminates a contract can owe reinstatement, wages and insurance contributions for the period the employee could not work, plus at least two months of contractual salary. Further amounts depend on notice failures and whether either side agrees to end the relationship. The Labour Code does not set a general six-month cap on all wrongful-termination liability.
Use the required disciplinary procedure
An employer must prove the employee's fault, follow the required participation and defence procedure, and keep a written record. Dismissal is limited to the statutory grounds, and disciplinary fines and wage deductions as punishment are prohibited. Employers with at least ten employees need written, registered internal labour rules. Ask the EOR how those rules, sexual-harassment procedures and the client's workplace policies fit together.
Send the facts to the EOR before discussing a termination date with the employee. A client cancellation, employee resignation and disciplinary dismissal have different legal and financial consequences.
What pay and leave should your offer in Vietnam cover?
Agree pay, working patterns, paid leave and benefits as part of the offer. These affect both your hiring budget and how you plan the employee’s work.
- Paid annual leave: 12 days
- Public holidays: 12 days
- The rest of the year: 341 days
The numbers behind this figure
| Entitlement | Days a year |
|---|---|
| Paid annual leave (statutory minimum) | 12 days |
| Public holidays (national) | 12 days |
| Total statutory paid days off | 24 days |
Source: National government, 2026; National government, 2026. Statutory minimums. Eligibility, accrual and collective agreements can change what an individual employee receives.
How does payroll and compensation work in VN?
Vietnam has four regional minimum wages rather than one, so the pay floor depends on the address the person works from.
Set pay for the role and workplace
The four regions are set by decree and reclassified from time to time.
| Region | Monthly minimum from 1 January 2026 | Hourly minimum |
|---|---|---|
| I | VND 5,310,000 | VND 25,500 |
| II | VND 4,730,000 | VND 22,700 |
| III | VND 4,140,000 | VND 20,000 |
| IV | VND 3,700,000 | VND 17,800 |
From 1 January 2026, monthly minimum wages are VND 5,310,000 in Region I, VND 4,730,000 in Region II, VND 4,140,000 in Region III and VND 3,700,000 in Region IV, with corresponding hourly rates of VND 25,500, 22,700, 20,000 and 17,800. Identify the workplace's classification under Decree 293/2025 before preparing an offer, because there is no single minimum for all Vietnam.
Vietnam's statistics office reported average monthly income of VND 10.0 million for wage and salary workers in the first half of 2026, with the separate figure for all workers at VND 9.0 million. These are national averages for different populations rather than salary quotes for an experienced specialist. Compare the actual role, skills and location before setting an offer.
Agree a recurring payday and clear payslip
Monthly-paid employees can be paid once a month or once every half-month, on a recurring date agreed by both sides, and the Labour Code does not set a universal fifth-of-the-month payday. Hourly, daily and weekly wages follow their own payment rule, with agreed combined payments no more than 15 days apart. Give the provider enough time to process approved hours, leave and payroll changes.
Employment wages are stated and paid in Vietnamese dong, with an exception allowing foreign employees in Vietnam to be paid in foreign currency. Each payment must have a statement showing pay, overtime, night-work pay and any deductions. Pay may be in cash or through the employee's bank account, and the employer bears the relevant account-opening and transfer fees where bank payment is used.
State the bonus and benefit commitments
The Labour Code allows bonuses based on business results and employee performance under the employer's announced rules. It does not create a general compulsory 13th-month salary or a fixed Tet bonus. State any promised bonus, eligibility and calculation in the offer and policy, and have the provider check the effect of those commitments.
Explain the benefits included in the offer and distinguish compulsory social and health insurance from any additional private medical cover, allowance, bonus or extra leave. State eligibility, employee contributions, exclusions and what happens during leave or after employment ends. Do not describe private cover, a 13th salary or an allowance as universally mandatory unless a binding term or applicable rule requires it.
Ask for a salary quote suited to the duties, experience, language skills and work location. The statutory floor and national income average serve different purposes, and neither tells you the exact offer a particular candidate will accept.
What benefits and leave are employees entitled to in VN?
Annual leave starts at 12 paid working days and the statutory holiday count rose to 12 days in 2026, so the paid time off is modest on paper and generous around Tet.
Plan paid leave and insurance benefits
The maternity and paternity rows changed in July 2026 and are the ones to check against an older policy.
| Type of leave | Starting point | What changes the entitlement |
|---|---|---|
| Annual leave | 12 paid working days after 12 months for ordinary work | Job conditions, protected groups, service length and proportionate entitlement |
| Public holidays | 12 statutory paid days in 2026 | Annual arrangements, substitute rest and extra national holidays for foreign workers |
| Sickness | Social-insurance benefit for eligible employees | Contribution history, work conditions, medical evidence and long-term illness |
| Maternity | Normally six months; seven for the qualifying second-child case | July 2026 rules, existing children, insurance conditions and multiple births |
| Paternity | Generally five to 14 working days in the common cases | Birth circumstances, second-child eligibility and multiple births |
| Family events | Specified paid marriage and bereavement leave | The event and family relationship |
Record annual leave and public holidays
After 12 months with an employer, an employee doing ordinary work is entitled to 12 paid working days of annual leave. The allowance is 14 days for specified groups, including minors, employees with disabilities and hazardous work, and 16 days for particularly hazardous work. Add one day for each five years with the employer, and employees with shorter service receive proportionate leave.
The employer sets the annual-leave schedule after consulting employees and must notify them in advance. The parties may agree to take leave in parts or combine it over up to three years. When employment ends, untaken annual leave is paid out under the Labour Code, so keep a usable leave record rather than assuming unused days disappear automatically at year end.
The Labour Code provides 11 paid public-holiday days: New Year's Day, five days for Tet, 30 April, 1 May, two days around National Day and Hung Kings Commemoration Day on the tenth day of the third lunar month. The new paid Vietnam Culture Day on 24 November brings the total to 12 in 2026. Foreign employees also receive one day for their own traditional New Year and one for their country's National Day. Check the annual Tet and National Day arrangements and substitute-rest rules.
24 November is now a paid statutory holiday, first observed in 2026. As reviewed on 14 September, the government's proposed workday swaps to create a longer break are separate from that legal entitlement. Do not announce a four-day paid break for every private employee unless the applicable calendar or employer arrangement supports it.
Handle sickness and care for a sick child
For eligible insured employees in ordinary working conditions, annual sickness-benefit limits are 30 working days with under 15 contribution years, 40 days with 15 to under 30 years and 60 days with at least 30 years. The usual benefit is 75% of the relevant insured salary, subject to medical and claim requirements, and higher limits apply to specified hazardous work. Continued treatment for listed long-term illnesses can qualify for further benefits at different rates, and none of this is a rule requiring the employer to pay the first 30 days at full salary.
Eligible insured employees can receive sickness benefits for caring for a child under seven: up to 20 working days a year for each child under three, or 15 for a child aged three to under seven. Where both parents are insured, each has their own entitlement. The ordinary benefit rate is 75% of the relevant insured salary, with the required medical evidence.
Check maternity leave and pay separately
The ordinary entitlement is six months of maternity leave, with no more than two months taken before birth, and multiple births add one month for each child from the second child born. From 1 July 2026, the qualifying second-child case has a seven-month entitlement. Keep the ordinary rule and the second-child conditions clear when planning cover.
From 1 July 2026, a qualifying mother giving birth with one living biological child already receives seven months of maternity leave for a single birth, subject to the social-insurance eligibility conditions. The corresponding insured-father entitlement is ten working days when his wife meets the second-child condition. Multiple-birth and other special rules require a separate calculation, and this change follows the number of qualifying children rather than the employee's second pregnancy.
Eligible maternity benefit is generally 100% of the average salary used for compulsory social-insurance contributions over the six most recent months before leave. The ordinary contribution condition is at least six months in the preceding 12 months, with special rules for prescribed pregnancy rest and infertility treatment. Vietnam Social Security confirms that a qualifying seven-month second-child leave receives benefit for those seven months, and an extra employer top-up is a separate offer commitment.
Arrange paternity leave and the return to work
An insured father normally receives five working days when his wife gives birth, seven for a surgical birth or birth before 32 weeks, ten for twins or a qualifying second child, and 14 for twins delivered surgically. Additional days apply to births of three or more children. Leave must begin within 60 days of the birth, and if split, the final period must also begin within that window. Social-insurance benefit rules apply.
A mother may return before maternity leave ends only after at least four months, with prior notice, employer agreement and the required medical confirmation, and she can continue receiving maternity benefit alongside pay for work. The employer must restore her previous work or suitable work without lower pay. A mother nursing a child under 12 months has a paid 60-minute daily break, and additional unpaid leave after maternity leave requires agreement.
Employees receive three paid days for their own marriage, one for a child's marriage, and three for the death of a spouse, child or the specified parents and parents-in-law. The Labour Code also provides one unpaid day with notice for certain other family events, and allows further unpaid leave by agreement. Record the event and entitlement instead of using a single bereavement allowance for every relative.
Explain any additional benefits
Read this in full under “State the bonus and benefit commitments”.
What happens if you need to end employment in Vietnam?
Discuss the proposed change with the EOR before giving notice or promising an exit payment. Ask it to confirm the procedure, timing and costs for the employee’s circumstances.
The numbers behind this figure
| Obligation | Weeks of salary |
|---|---|
| Statutory notice | 6.4 weeks |
| Statutory severance | 8.7 weeks |
| Total statutory exit cost | 15.1 weeks |
Vietnam sits at number 57 of 191 countries for statutory exit cost in our Termination Cost Index.
What compliance and regulatory rules apply in VN?
Two compliance areas matter most for a first hire: permission to work, and a data protection law that only took effect this year.
Check permission for a foreign employee to work
A foreign employee normally needs a work permit unless a specific exemption applies, and eligibility depends on the role, qualifications, health and other legal conditions. A work permit lasts no more than two years and may be extended once for up to two more years, and the employment contract cannot outlast the permit. Entry or residence permission is a separate check, because an EOR agreement is not immigration approval.
Decree 219/2025 combines the explanation of demand for a foreign worker and the permit application in Form 03. Official guidance gives the competent provincial authority ten working days to decide after receiving a valid, complete dossier, while preparing, legalising and correcting documents can take additional time. Confirm the eligible employing entity, role, documents and any exemption before committing to a start date.
Ask the provider to confirm the actual permit or exemption route and the lawful start conditions. A work-permit exemption still needs the applicable checks, and it is not a general exemption for every manager or remote worker.
Keep employee data and workplace protections current
Vietnam's Personal Data Protection Law took effect on 1 January 2026. Collect applicant information for the recruitment purpose with the required consent, and delete or destroy unsuccessful applicants' data unless otherwise agreed. Keep employee data for the lawful or agreed period, and after employment ends the deletion duties still allow legally required or agreed retention. Any technology used to monitor employees must be lawful and known to them. Agree access, retention and handling of requests with the EOR.
The Labour Code prohibits workplace discrimination, forced labour and sexual harassment. Protected grounds include sex, age, pregnancy, marital status, disability, family responsibilities, ethnicity, religion and trade-union participation, among others. Apply these protections in recruitment, pay, work allocation and dismissal, and give the employee clear contacts for concerns involving either the EOR or your team.
Read this in full under “Protect confidential information and clarify ownership”.
Keep responsibilities clear as work changes
A dispatch agency remains the employer, pays wages and handles employer duties. The client must communicate workplace rules and safety requirements, avoid discriminatory treatment and agree overtime or night work with the employee as required. Dispatched workers must receive at least the pay of the client's employees with the same qualifications doing the same or equivalent work. Set out who records hours, handles concerns and responds to accidents.
A change in role, workplace, assignment length, immigration status or family circumstances can require a fresh review. Give the provider those details before changing the arrangement.
Read this in full under “Record breaks and remote working arrangements”.
These are stored source rules, not a case-specific termination calculation. Confirm the applicable procedure and current requirements before acting.
Choose an EOR for your hire in Vietnam
Compare the employing entity, itemised costs, local support, payroll deadlines and what happens if you change or end the arrangement.
Questions about hiring in Vietnam
How much does an EOR in Vietnam charge?
Ask for a quote that separates the provider's fee from gross salary, employer insurance, the union contribution, additional benefits and any setup or exit charges. The VND 37,050,000 monthly example in this guide is a statutory-cost subtotal for a VND 30,000,000 salary under stated assumptions, and it is not an EOR service price.
How quickly can we hire through a Vietnam EOR?
Timing depends on the legal model, role, documents, insurance and payroll setup, and any immigration procedure. Ask the provider to confirm the lawful start conditions and payroll cutoff for the actual employee. The ten-working-day official permit decision period starts with a valid, complete dossier and does not include every preparation step.
What should I ask a Vietnam EOR before signing?
Identify the legal employer and the arrangement that permits it to support this role. Ask about any dispatch licence and time limit, the complete payroll calculation, insurance coverage, leave and bonus commitments, data handling, and the process and charges if employment ends. Record your team's responsibilities in the service agreement.
What changed in Vietnam
Checked against official sources on .
No rule changes recorded since we began logging them.
Corrections to this guide
- Corrected 11 October 2026Employer social contributions: 21% → 21.5% · sourceSocial insurance 17% (14 retirement + 3 sickness/maternity) + occupational accident/disease 0.5% + health insurance 3% + unemployment 1%. Excludes 2% trade union fee (not SS).
Check the facts behind this guide
Each reviewed fact links to its source and shows its validation date and effective period. Monthly review does not mean that every rule changes monthly. Statistical benchmarks retain their original data periods.
View sourced facts and review dates
| Fact | Value | Source | Effective / data period | Last validated |
|---|---|---|---|---|
| Check the provider’s legal employment arrangement | An employer of record employs your hire and administers agreed contracts, payroll and benefits while your team directs the work. In Vietnam, that setup needs a legal-model check: labour dispatch is a regulated activity. Ask which Vietnamese entity employs the person, what authorisation it holds and whether the proposed role and assignment can lawfully use that arrangement. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Labour dispatch has a 12-month limit | Where the arrangement is labour dispatch, the agency needs the required licence, the work must be a permitted type and an employee’s dispatch period cannot exceed 12 months. The Labour Code also limits when a client may use dispatched labour. An EOR label does not make every role eligible or allow an indefinite assignment. Resolve the actual model before signing. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Agree the responsibilities of the client and employer | A dispatch agency remains the employer, pays wages and handles employer duties. The client must communicate workplace rules and safety requirements, avoid discriminatory treatment and agree overtime or night work with the employee as required. Dispatched workers must receive at least the pay of the client’s employees with the same qualifications doing the same or equivalent work. Set out who records hours, handles concerns and responds to accidents. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Put the employment terms in writing | Use a written employment contract, subject to the Labour Code’s limited exceptions. Include the legal employer and employee, job and workplace, term, salary and payment arrangements, working time, rest, protective equipment, insurance and training terms. Agree wording the employee understands; a Vietnamese or bilingual version helps both sides check the terms. Do not assume that an English document is automatically void or that a provider template fits every role. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Fixed-term contracts generally run for up to 36 months | Vietnam recognises indefinite contracts and fixed-term contracts of no more than 36 months. If work continues after a fixed term ends, the parties generally have 30 days to sign a new contract; otherwise it becomes indefinite. Normally only one further fixed-term contract is allowed before an indefinite contract is required. Statutory exceptions include foreign workers, so check the person’s category before applying the general renewal limit. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Match probation to the work | Probation is limited to one period for the same job: up to 180 days for specified enterprise executives, 60 days for work requiring college qualifications or above, 30 days for specified technical or vocational work, and six working days for other work. Pay must be at least 85% of the agreed job salary. No probation applies to a contract shorter than one month. During probation either side may end the arrangement without notice or compensation. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| A contractor label does not decide employment status | An agreement can be an employment contract even if it has another name: the Labour Code looks for paid work, wages and one party’s management, direction or supervision. Use a contractor arrangement only after checking how the work will actually be performed. Calling someone a freelancer does not remove employment duties where those features exist. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Write the confidentiality and ownership terms clearly | For work directly involving business or technology secrets, the Labour Code permits a written agreement covering protection, duration, rights and compensation for breach. Describe the information and work being protected. For an EOR hire creating software, designs or other material, also document the rights the employer receives and the written transfer or licence your business needs. Review any post-employment restriction separately; there is no safe universal one-year non-compete rule to copy. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Use the current rules when signing electronically | Electronic employment contracts can have the same legal value as paper contracts. Decree 337/2025 sets requirements for identity checks, digital signatures, timestamps and the eContract service used. The electronic-contract rules apply from 1 July 2026; compliant providers send the contract to the government platform within 24 hours of the final signature. Paper contracts remain possible: this is not a requirement to replace every contract with an electronic one. | Vietnam Government Portal, official policy and implementation guidance | Decree 337/2025/ND-CP: effective 1 January 2026, electronic-contract implementation from 1 July 2026 | Review due |
| Apply the minimum for the actual workplace | From 1 January 2026, monthly minimum wages are VND 5,310,000 in Region I, VND 4,730,000 in Region II, VND 4,140,000 in Region III and VND 3,700,000 in Region IV. The corresponding hourly rates are VND 25,500, 22,700, 20,000 and 17,800. Identify the workplace’s classification under Decree 293/2025 before preparing an offer; there is no single minimum for all Vietnam. | Vietnam Government Portal, official policy and implementation guidance | Regional minimum wages under Decree 293/2025/ND-CP, effective 1 January 2026 | Review due |
| Use the national earnings figure as context | Vietnam’s statistics office reported average monthly income of VND 10.0 million for wage and salary workers in the first half of 2026. The separate figure for all workers was VND 9.0 million. These are national averages for different populations, not salary quotes for an experienced specialist. Compare the actual role, skills and location before setting an offer. | Vietnam National Statistics Office, Ministry of Finance | First half of 2026; NSO Labour Force Survey average monthly income of wage and salary workers, nominal VND; not a full-year estimate or a role-specific salary | Review due |
| Agree a regular monthly or twice-monthly payday | Monthly-paid employees can be paid once a month or once every half-month, on a recurring date agreed by both sides. The Labour Code does not set a universal fifth-of-the-month payday. Hourly, daily and weekly wages follow their own payment rule, with agreed combined payments no more than 15 days apart. Give the provider enough time to process approved hours, leave and payroll changes. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| State the currency and provide a payslip | Employment wages are stated and paid in Vietnamese dong, with an exception allowing foreign employees in Vietnam to be paid in foreign currency. Each payment must have a statement showing pay, overtime, night-work pay and any deductions. Pay may be in cash or through the employee’s bank account; the employer bears the relevant account-opening and transfer fees where bank payment is used. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Separate agreed bonuses from statutory pay | The Labour Code allows bonuses based on business results and employee performance under the employer’s announced rules. It does not create a general compulsory 13th-month salary or a fixed Tet bonus. State any promised bonus, eligibility and calculation in the offer and policy, and have the provider check the effect of those commitments. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Budget employer insurance separately | For an ordinary covered Vietnamese employee, standard employer contributions total 21.5% of the relevant contribution bases: 14% retirement and survivor insurance, 3% sickness and maternity, 0.5% occupational accident and disease insurance, 3% health insurance and 1% unemployment insurance. The separate employer union contribution is additional. Caps, coverage and approved reduced rates can change the actual amount; 21.5% is not a universal percentage of every employee’s full salary. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Employee insurance is normally 10.5% on covered bases | For an ordinary covered Vietnamese employee, payroll generally deducts 8% retirement and survivor insurance, 1.5% health insurance and 1% unemployment insurance: 10.5% before income tax. Apply each contribution’s coverage and cap. These deductions come from the employee’s pay and should not be added a second time to the employer’s cost. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Use the employer’s applicable accident-insurance rate | The ordinary employer contribution to occupational accident and disease insurance is 0.5% of the compulsory social-insurance salary base. A 0.3% rate is available only for enterprises meeting the specified conditions and approval process. Check the provider’s actual rate and cover; the reduction is not automatic for every office-based hire. | Vietnam Ministry of Home Affairs, consolidated occupational accident contribution decree, January 2026 | Review due | |
| Add the separate employer union contribution | The statutory employer union contribution is generally 2% of the salary fund used for compulsory social insurance. Keep it separate from the 21.5% standard employer insurance total and from employee union membership fees. Exemption, reduction or temporary suspension depends on the legal conditions; do not assume a provider can opt out. | Vietnam Government Portal, official policy and implementation guidance | Review due | |
| Use the covered salary components | For employer-set wages, the compulsory social-insurance base includes pay for the job or title, salary allowances and other supplements agreed to be paid regularly and consistently each pay period. It is not automatically the lowest regional wage or the employee’s entire take-home pay. Have payroll identify the included components before applying rates and caps. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| The social-insurance cap increased in July 2026 | The reference amount is VND 2,530,000 a month from 1 July 2026. The compulsory social-insurance ceiling is 20 times that amount: VND 50,600,000 a month. Covered employee health contributions use the compulsory social-insurance salary base. Unemployment insurance has a different ceiling: 20 times the applicable regional monthly minimum. Do not use the old VND 46,800,000 social-insurance ceiling for payroll after June 2026. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Reference amount and social-insurance ceiling from 1 July 2026; separate regional unemployment-insurance ceiling under Employment Law 74/2025 | Review due |
| Check foreign-worker coverage separately | Foreign employees on qualifying fixed-term contracts of at least 12 months are covered by compulsory social insurance and the corresponding health-insurance category, subject to exclusions such as qualifying intra-company transfers, retirement age at contract signing and applicable treaties. Vietnam’s unemployment-insurance regime covers Vietnamese workers. For a foreign employee covered by standard social and health insurance, the usual shares are therefore 20.5% employer and 9.5% employee on covered bases, before the separate employer union contribution. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Resident employment income uses five tax bands | For resident employment income in tax year 2026, the monthly taxable-income bands are: up to VND 10 million at 5%; above 10 million to 30 million at 10%; above 30 million to 60 million at 20%; above 60 million to 100 million at 30%; and above 100 million at 35%. Each rate applies to the slice in that band. Calculate taxable income after the allowed deductions; the top rate does not apply to the whole gross salary. | Vietnam National Assembly, Personal Income Tax Law 109/2025/QH15 | Resident salary and wage income for tax year 2026 under Law 109/2025; current 2026 withholding guidance checked | Review due |
| Apply the 2026 personal and dependant deductions | For resident employment income, the personal deduction is VND 15.5 million a month and the deduction for each qualifying dependant is VND 6.2 million a month. A dependant can be claimed only once by one taxpayer. Eligible compulsory insurance and other permitted deductions also affect taxable income. Confirm eligibility and payroll documentation instead of estimating net pay from a single flat tax rate. | Vietnam National Assembly, Personal Income Tax Law 109/2025/QH15 | Resident salary and wage income, tax year 2026 | Review due |
| Nationality alone does not decide tax residence | The tax-residence test includes presence for at least 183 days in a calendar year or a consecutive 12-month period from first arrival, and a separate regular-residence test. Residents are generally assessed on worldwide taxable income. Non-resident employment income for work performed in Vietnam is generally taxed at 20%, wherever it is paid. Check the person’s full circumstances and any treaty before setting payroll treatment. | Vietnam National Assembly, Personal Income Tax Law 109/2025/QH15 | Review due | |
| Withholding depends on the contract and payment | Current government guidance under Decree 253/2026 uses progressive withholding for residents with employment contracts of at least three months. For residents without a contract or with one shorter than three months, qualifying payments of at least VND 5 million per payment generally attract 10% withholding, subject to the permitted declaration and other conditions. This is a withholding mechanism, not a replacement for the employee’s final annual tax calculation. | Vietnam Government Portal, official policy and implementation guidance | Review due | |
| Example: VND 30 million gross salary | For a covered Vietnamese employee earning VND 30,000,000 a month, assume the full amount is the base for each contribution, the standard 0.5% accident rate applies and no relief is available. Employer insurance is VND 6,450,000 and the separate 2% union contribution is VND 600,000. The subtotal is VND 37,050,000 a month before EOR fees, additional benefits, equipment, overtime, bonuses and exit costs. The employee’s VND 3,150,000 insurance deduction comes out of gross pay; income tax is calculated separately. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Plan within eight hours a day and 48 a week | Normal working time is generally capped at eight hours a day and 48 hours a week. Where the employer arranges working time on a weekly basis, normal hours may reach ten a day while staying within 48 a week. The law encourages a 40-hour week. Set the actual schedule in the contract and check overtime before agreeing extended hours or overseas time-zone coverage. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Overtime needs consent and stays within limits | Ordinary overtime requires the employee’s consent. It is generally limited to 50% of normal daily hours; under a weekly schedule, normal work plus overtime cannot exceed 12 hours a day. The limit is 40 overtime hours a month and 200 a year, with up to 300 a year only in specified cases and with the required notification. Emergency provisions are separate. Do not treat 300 hours as the default for every hire. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Pay the applicable overtime premium | The minimum overtime rates are 150% of the applicable wage on ordinary workdays, 200% on weekly rest days and 300% on public holidays or paid-leave days. The 300% excludes the holiday or leave pay owed to employees paid by the day. Record the day type, hours and pay basis so payroll calculates the correct amount. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Night work has an extra premium | Night work runs from 10pm to 6am and attracts at least a 30% wage premium. Overtime at night requires the overtime pay, the night-work addition and a further 20% of the applicable daytime wage for that type of day. A flat overtime percentage alone can underpay someone working late for an overseas team. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Allow breaks and weekly rest | An employee working at least six hours a day gets a break of at least 30 consecutive minutes, or 45 minutes for night work. For a continuous shift of at least six hours, that break counts as working time. Allow at least 12 hours between shifts and 24 consecutive hours of weekly rest; where the work cycle prevents weekly rest, the law requires an average of at least four rest days a month. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Document how remote work will operate | Agree the work location, working hours, equipment, expenses, data access and how the employee reports overtime or concerns. Remote work remains subject to employment, pay, rest and safety duties. A move within Vietnam can change the regional wage check, while a move across borders needs a fresh employment, tax and immigration review. An EOR contract does not itself give permission to work in another country. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Provide at least 12 paid working days for ordinary work | After 12 months with an employer, an employee doing ordinary work is entitled to 12 paid working days of annual leave. The allowance is 14 days for specified groups, including minors, employees with disabilities and hazardous work, and 16 days for particularly hazardous work. Add one day for each five years with the employer. Employees with shorter service receive proportionate leave. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Agree leave scheduling and settle unused leave on exit | The employer sets the annual-leave schedule after consulting employees and must notify them in advance. The parties may agree to take leave in parts or combine it over up to three years. When employment ends, untaken annual leave is paid out under the Labour Code. Keep a usable leave record rather than assuming unused days disappear automatically at year end. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Vietnam has 12 statutory paid holiday days in 2026 | The Labour Code provides 11 paid public-holiday days: New Year’s Day, five days for Tet, 30 April, 1 May, two days around National Day and Hung Kings Commemoration Day on the tenth day of the third lunar month. The new paid Vietnam Culture Day on 24 November brings the total to 12 in 2026. Foreign employees also receive one day for their own traditional New Year and one for their country’s National Day. Check the annual Tet and National Day arrangements and substitute-rest rules. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| A proposed long weekend is not yet an entitlement | 24 November is now a paid statutory holiday, first observed in 2026. As reviewed on 14 September, the government’s proposed workday swaps to create a longer break are separate from that legal entitlement. Do not announce a four-day paid break for every private employee unless the applicable calendar or employer arrangement supports it. | Vietnam Government Portal, official policy and implementation guidance | Resolution 28/2026/QH16 holiday enacted; additional calendar proposals checked on 14 September 2026 | Review due |
| Sickness benefits generally come through social insurance | For eligible insured employees in ordinary working conditions, annual sickness-benefit limits are 30 working days with under 15 contribution years, 40 days with 15 to under 30 years and 60 days with at least 30 years. The usual benefit is 75% of the relevant insured salary, subject to medical and claim requirements. Higher limits apply to specified hazardous work. Continued treatment for listed long-term illnesses can qualify for further benefits at different rates; this is not a rule requiring the employer to pay the first 30 days at full salary. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Insured parents can claim leave to care for a sick child | Eligible insured employees can receive sickness benefits for caring for a child under seven: up to 20 working days a year for each child under three, or 15 for a child aged three to under seven. Where both parents are insured, each has their own entitlement. The ordinary benefit rate is 75% of the relevant insured salary, with the required medical evidence. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Maternity leave is normally six months | The ordinary entitlement is six months of maternity leave, with no more than two months taken before birth. Multiple births add one month for each child from the second child born. From 1 July 2026, the qualifying second-child case has a seven-month entitlement. Keep the ordinary rule and the second-child conditions clear when planning cover. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Check the new seven-month second-child entitlement | From 1 July 2026, a qualifying mother giving birth with one living biological child already receives seven months of maternity leave for a single birth, subject to the social-insurance eligibility conditions. The corresponding insured-father entitlement is ten working days when his wife meets the second-child condition. Multiple-birth and other special rules require a separate calculation. This change follows the number of qualifying children, not the employee’s second pregnancy. | Government of Vietnam, Decree 168/2026/ND-CP | Population Law 113/2025 and Decree 168/2026: qualifying second-child leave from 1 July 2026 | Review due |
| Separate leave entitlement from insurance eligibility | Eligible maternity benefit is generally 100% of the average salary used for compulsory social-insurance contributions over the six most recent months before leave. The ordinary contribution condition is at least six months in the preceding 12 months, with special rules for prescribed pregnancy rest and infertility treatment. Vietnam Social Security confirms that a qualifying seven-month second-child leave receives benefit for those seven months. An extra employer top-up is a separate offer commitment. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Paternity leave varies with the birth | An insured father normally receives five working days when his wife gives birth, seven for a surgical birth or birth before 32 weeks, ten for twins or a qualifying second child, and 14 for twins delivered surgically. Additional days apply to births of three or more children. Leave must begin within 60 days of the birth; if split, the final period must also begin within that window. Social-insurance benefit rules apply. | Vietnam National Assembly Office, Social Insurance Law consolidated February 2026 | Review due | |
| Plan the return and daily care breaks | A mother may return before maternity leave ends only after at least four months, with prior notice, employer agreement and the required medical confirmation. She can continue receiving maternity benefit alongside pay for work. The employer must restore her previous work or suitable work without lower pay. A mother nursing a child under 12 months has a paid 60-minute daily break; additional unpaid leave after maternity leave requires agreement. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Provide the statutory paid family-event leave | Employees receive three paid days for their own marriage, one for a child’s marriage, and three for the death of a spouse, child or the specified parents and parents-in-law. The Labour Code also provides one unpaid day with notice for certain other family events, and allows further unpaid leave by agreement. Record the event and entitlement instead of using a single bereavement allowance for every relative. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Make additional benefits explicit | Explain the benefits included in the offer and distinguish compulsory social and health insurance from any additional private medical cover, allowance, bonus or extra leave. State eligibility, employee contributions, exclusions and what happens during leave or after employment ends. Do not describe private cover, a 13th salary or an allowance as universally mandatory unless a binding term or applicable rule requires it. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Employer notice depends on the termination ground and term | For ordinary lawful unilateral termination, the employer generally gives at least 45 days’ notice for an indefinite contract, 30 days for a fixed term of at least 12 months, and three working days for a fixed term shorter than 12 months. Termination on the specified prolonged-illness ground uses three working days. Special occupations and grounds have different rules. Giving notice alone does not create a lawful reason to dismiss. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Confirm a lawful reason before ending employment | Employer termination must fit a legal ground and follow its procedure. Examples include documented repeated failure against properly established performance criteria, specified prolonged illness and certain unavoidable reductions after required measures. Separate rules cover contract expiry, agreement, redundancy and disciplinary dismissal. Pregnancy, maternity, approved leave and other protected circumstances restrict employer action. An end to the client’s project is not automatically a lawful dismissal of the employee. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Employees can resign with the applicable notice | An employee may generally resign with 45 days’ notice on an indefinite contract, 30 days on a fixed term of at least 12 months, or three working days on a shorter fixed term. Special occupations have separate rules. The Labour Code allows resignation without notice in specified cases, including certain failures to provide agreed work or pay, maltreatment and workplace sexual harassment. Review the reason before treating a departure as unlawful. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Calculate severance using qualifying service | For specified lawful endings after at least 12 months of regular work, severance is half a month’s salary for each qualifying year. Deduct periods covered by unemployment insurance and periods already paid severance or redundancy allowance. Use the average contractual salary over the last six months. Lawful resignation and contract expiry can qualify; severance is not automatically excluded whenever an employee resigns. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Redundancy has its own process and allowance | Structural, technological or qualifying economic changes can require an employment-use plan, consultation and notice to the provincial People’s Committee and employees. Where the statutory job-loss allowance applies after at least 12 months of regular work, it is one month’s salary per qualifying year, with a minimum of two months. Qualifying service excludes unemployment-insured time and previously compensated periods. This is separate from ordinary severance. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Settle the exit account promptly | The parties generally have 14 working days from termination to settle payments relating to their rights and interests. Specified situations permit an extension, but no more than 30 days. Include outstanding wages, untaken annual leave and any applicable allowances. The employer must complete insurance-record procedures and return retained original documents; do not use the old seven-day deadline. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Unlawful termination can require reinstatement and back pay | An employer that unlawfully terminates a contract can owe reinstatement, wages and insurance contributions for the period the employee could not work, plus at least two months’ contractual salary. Further amounts depend on notice failures and whether either side agrees to end the relationship. The Labour Code does not set a general six-month cap on all wrongful-termination liability. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Follow the disciplinary process and workplace rules | An employer must prove the employee’s fault, follow the required participation and defence procedure, and keep a written record. Dismissal is limited to the statutory grounds; disciplinary fines and wage deductions as punishment are prohibited. Employers with at least ten employees need written, registered internal labour rules. Ask the EOR how those rules, sexual-harassment procedures and the client’s workplace policies fit together. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Confirm work permission before a foreign hire starts | A foreign employee normally needs a work permit unless a specific exemption applies. Eligibility depends on the role, qualifications, health and other legal conditions. A work permit lasts no more than two years and may be extended once for up to two more years. The employment contract cannot outlast the permit. Entry or residence permission is a separate check; an EOR agreement is not immigration approval. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Use the procedure introduced by Decree 219 | Decree 219/2025 combines the explanation of demand for a foreign worker and the permit application in Form 03. Official guidance gives the competent provincial authority ten working days to decide after receiving a valid, complete dossier. Preparing, legalising and correcting documents can take additional time. Confirm the eligible employing entity, role, documents and any exemption before committing to a start date. | Vietnam Government Portal, official policy and implementation guidance | Review due | |
| Apply the current employee-data rules | Vietnam’s Personal Data Protection Law took effect on 1 January 2026. Collect applicant information for the recruitment purpose with the required consent, and delete or destroy unsuccessful applicants’ data unless otherwise agreed. Keep employee data for the lawful or agreed period; after employment ends, deletion duties still allow legally required or agreed retention. Any technology used to monitor employees must be lawful and known to them. Agree access, retention and handling of requests with the EOR. | Vietnam Government Portal, official policy and implementation guidance | Personal Data Protection Law 91/2025/QH15, effective 1 January 2026 | Review due |
| Protect equal treatment and employee rights | The Labour Code prohibits workplace discrimination, forced labour and sexual harassment. Protected grounds include sex, age, pregnancy, marital status, disability, family responsibilities, ethnicity, religion and trade-union participation, among others. Apply these protections in recruitment, pay, work allocation and dismissal. Give the employee clear contacts for concerns involving either the EOR or your team. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Check employee representation and applicable agreements | Employees have rights to join and participate in employee representative organisations and collective bargaining under the Labour Code. Check whether a collective agreement binds the employing entity or workplace and preserve any applicable terms that improve on the statutory floor. An EOR arrangement does not remove representation rights or make every sector agreement automatically applicable. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due | |
| Keep the review date separate from the data period | We check selected sources monthly and review relevant changes before updating the guide. Fact notes show the source, review date and applicable period. A successful fetch does not verify a legal claim: a first-half earnings release, a July payroll change and an older provision may all be reviewed on the same day. Unresolved source or interpretation issues remain visible for follow-up. | Vietnam National Assembly Office, Labour Code consolidated February 2026 | Review due |