Vietnam
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Introduction
General Overview & Economic Facts
- Vietnam, officially known as the Socialist Republic of Vietnam, is a country in Southeast Asia.
- It is located on the eastern edge of mainland Southeast Asia
- It covers 311,699 km2 and has a population of over 96 million
- Vietnam is regarded as as developing country with a lower-middle-income economy, however, it has one of the fastest growing economies of the century
- Vietnam’s economy ranks 40th by nominal GDP (2021) and 24th by PPP (2021). The country has achieved a high standard of living and is ranked 117th the world for HDI (2019)
Why Employ In Vietnam?
- The main exports from Vietnam are electrical and electronic products, coffee and textiles.
- 15.22% of the population is between the ages of 15 and 24 years, with 45.70% of the population being between the ages of 25 and 54. Vietnam has a youthful population, making it a favorable country to employ young, energetic employees
Overview Of The Labour Law
- The employment regulations in Vietnam are mostly governed by the Labour Code. The code covers working hours, rest periods, paid leave, notice periods and severance pay
- Employment contracts are governed by collective agreements
- Vietnam’s labour laws are heavily employee-friendly, particularly on issues related to the termination or dismissal of employees
Fun Country Facts
- Vietnam is the biggest exporter of cashews
- Vietnam has a deity for the kitchen known as Ong Tao
- Snake wine is a common drink that is said to boost health
Why Use Playroll Services For Vietnam?
- Employing in Vietnam requires companies to have their own legal entity in the country as well as managing payroll, employee benefits, taxes and legal compliance. This can get quite complicated, especially with the complexity of employment laws in Vietnam
- With Playroll’s Employer of Record services, your team will be employed by our established legal entities in each country
- We will take care of payroll, employee benefits, taxes, legal compliance and provide ongoing employee support, so that you can focus on growing a thriving team
Employer Contributions
These are additional costs incurred by employers over and above the employee’s monthly gross salary and/or bonus.
Social Insurance
Sickness and Maternity
3.00%
Calculated of a maximum salary of VND 29,800,000.00
Occupational diseases and accidents – normal rate
0.50%
Calculated of a maximum salary of VND 29,800,000.00
Retirement and death
14.00%
Calculated of a maximum salary of VND 29,800,000.00
Unemployment Insurance
Region I
1.00%
Calculated of a maximum salary of VND 88,400,000.00 per month
Region II
1.00%
Calculated of a maximum salary of VND 78,400,000 per month
Region III
1.00%
Calculated of a maximum salary of VND 68,600,000 per month
Region IV
1.00%
Calculated of a maximum salary of VND 61,400,000 per month
Health Insurance
Trade Union Fee
Employee Contributions
These are costs incurred by employees that reduce their monthly gross salary and/or bonus to determine their net “take home” pay.
Social Insurance
Retirement and death
8.00%
Calculated of a maximum salary of VND 29,800,000.00
Health Insurance
1.50%
Calculated of a maximum salary of VND 29,800,000.00
Trade Union Fee
2.00%
Optional. Payable if employee is a Trade Union member. Calculated of a maximum salary of VND 29,800,000.00
Income Tax
Called Personal Income Tax (Pit) In Vietnam
Income tax is on worldwide income
Income bracket per annum
0.00 – 5,000,000.00
5.00%
5,000,001.00 – 10,000,000.00
10.00%
10,000,001 – 18,000,000.00
15.00%
18,000,001 – 32,000,000.00
20.00%
32,000,001 – 52,000,000.00
25.00%
52,000,001 – 80,000,000.00
30.00%
80,000,001.00 or more
35.00%
Employment Terms
General
Minimum Wage
Minimum wage varies by region:
- Region I (includes the urban areas) – VND 4,420,000.00
- Region II – VND 3,920,000.00
- Region III – VND 3,430,000.00
- Region IV – VND 3,070,000.00
Common Minimum Wage- VND 1,490,000.00
Working Hours
- Maximum of 8 hours per day and 48 hours per week
- Minimum 30-minute meal interval after 6 hours of work
- Typical working hours start at 07h30/08h00 and end between 16h00 to 18h00 Monday to Friday
Overtime
- Employees may work a maximum of 60 overtime hours per month and 300 overtime hours per year
Notice Period
- 45 days
Severance Pay
- Severance pay is determined by the employer and the employee’s period of employment
Probation Period
- There is no statutory probation period
- It is common to have a probation period of 6 to 180 days
Bonus
- There is no statutory bonus
- It is customary to award a ‘Tet bonus’ in Vietnam which is between 10 and 20% of the employee’s salary
Public Holidays
Public holidays 2022
- January 1st– New Year’s Day
- January 31st to February 4th– Tet
- April 10th– Hung Kings Commemoration Day
- April 11th– Hung Kings Commemoration Holiday
- April 30– Reunification Day
- May 1st– Labor Day
- May 2nd– Reunification Day Holiday
- May 3rd– Labor Day Holiday
- September 2nd – National Day
Leave
Paid Leave / Vacation Days
- Paid leave
- Paid by employer
- Employees working under normal working conditions- 12 days per year
- Employees who are underage, disabled, work under arduous, toxic, and hazardous conditions- 14 days per year
- Employees working under extremely heavy, hazardous, or toxic working conditions- 16 days per year
- Plus: An additional day of paid annual leave for every five years of consecutive service for an employer
Sick Leave
- Paid leave
- Paid by Social Security
- Employees working under normal working conditions
– If social insurance premiums paid for less than 15 years– 30 days per year
– If social insurance premiums paid for between 15 years and 30 years– 40 days per year
– If social insurance premiums paid for 30 or more years– 60 days per year
- Employees working in heavy, hazardous, or toxic conditions, or jobs
– If social insurance premiums paid for less than 15 years– 40 days per year
– If social insurance premiums paid for between 15 years and 30 years– 50 days per year
– If social insurance premiums paid for 30 or more years– 70 days per year
Maternity Leave
- Paid leave
- Paid by Social Security
- 6 months per year
Paternity Leave
- Paid leave
- Paid by Social Security
- 1 child- 5 days per year
- 2 children- 10 days per year
- 3 or more children- 10 days plus an additional 3 days for each child
Bereavement Leave
- Paid leave
- Paid by employer
- Minimum of 3 days per year
Family Care Leave
- Paid leave
- Paid by employer
- Maximum 20 days per year- child under 3 years old
- Maximum 15 days per year- child between 3 and 7 years old
Marriage Leave
- Paid leave
- Paid by employer
- Own wedding- 3 days per year
- Child’s wedding- 1 day per year