Wide coverage in revamped Labour Code provisions

Wide coverage in revamped Labour Code provisions, illustration photo

Foreigners working in Vietnam

Under Article 3 of Decree 152, a foreign worker who has a document certifying that he/she is an expert of an overseas agency, organisation, or enterprise is no longer considered as a foreign expert.

Instead, a foreign expert means a non-Vietnamese worker who has a university degree or higher or the equivalent, and has at least three years of working experience in the specialty in which he/she was trained in conformity with his/her expected working position in Vietnam (same with previous regulations); or has at least five years working experience and a practicing certificate in conformity with his/her expected working position in Vietnam.

Article 3 of Decree 152 also adds “having at least five years working experience suitable for his/her expected working position in Vietnam” as a new circumstance under which a foreign employee would be eligible to be recognised as a technician.

Moreover, a foreign worker who comes to work in Vietnam as an expert, a technician, and so on in the form of performing an intra-company transfer programme has to be recruited by the foreign company for at least 12 consecutive months before the transfer date instead of 12 months as previously regulated.

Under the previous regulations, the owners or the capital contributing members of a limited liability company and the members of the board of management (BOM) of a joint-stock company are exempted from work permit requirements. The new Labour Code adds the condition that these persons must have a capital contribution value as stated by government (Article 154). Decree 152 clarified the capital contribution value as VND3 billion ($130,400) or more (Article 7).

Besides that, according to previous regulations, a foreigner who comes to Vietnam to work as an expert, manager, chief executive director, or technician for under 30 days and for a total accumulated working period under 90 days per year is exempted from permit requirements. However, Decree 152 further limits the number of times those foreigners can enter Vietnam, to no more than three times per year (Article 7).

In principle, foreign workers who are not required to have a work permit with some exemptions must be confirmed by a competent authority for the exemption. The exemptions include those who stay in Vietnam for under three months to offer services for sale; those who enter Vietnam to hold the positions of experts, managers, chief executive officers, or technicians for under 30 days and an accumulated working period of under 90 days per year; those who stay in Vietnam for under three months to deal with complicated technical or technological problems; and relatives of members who are executing their functions in foreign missions in Vietnam upon the approval of the Ministry of Foreign Affairs.

Decree 152 sets out certain new situations under which foreigners working in Vietnam are not requested to apply for a confirmation of work permit exemption. This can be a foreign lawyer issued with a certificate to practice in Vietnam under the Law on Lawyers; a non-national who is married to a Vietnamese person and living in the territory of Vietnam; a foreigner who is an owner or capital contributing member of a limited liability company with a capital contribution of VND3 billion ($130,400) or more; and someone who is chairperson of a BOM, or BOM member of a joint-stock company with capital contribution of VND3 billion or more.

Article 155 of the new Labour Code adds a new procedure called “extension” of the work permit. Decree 152 clarifies its applicable circumstances and dossiers. Accordingly, if a foreigner continues to work in Vietnam after the expiration of the two-year of the permit, he/she must extend the permit instead of applying for a “re-issue”. It can be extended for one time for a maximum period of two years, which means that after four years working in Vietnam, foreign workers must apply for a new work permit via the normal issuance procedure.

Workplace sexual harassment

Under the new Labour Code, sexual harassment at the workplace shall be subjected to dismissal and the internal labour regulations must have provisions dealing with sexual harassment at the workplace. However, with the definition of sexual harassment in Article 3.9 of the new Labour Code, it is difficult to verify whether an act is considered sexual harassment or not.

Article 84 of Decree 145 provides a more clear concept that sexual harassment may occur in form of a request, demand, suggestion, threat, use of force to have sex in exchange for any work-related interests; or any sexual acts that thus creates an insecure and uncomfortable work environment and affects the mental, physical health, performance, and life of the harassed person.

Sexual harassment at the workplace includes actions, gestures, and physical contact with the body of a sexual or suggestive nature; verbal sexual harassment in the form of sexual or suggestive comments in person, by phone, or through electronic media; and non-verbal sexual harassment in the form of body language, display, or description of sex or sexual activities whether directly or through electronic media.

Annual leave

Decree 145 adds several new regulations relating to calculating annual leave days and salary during annual leave and other paid leave days that are more favorable for employees.

Under Decree 145, a working period of less than one month is also used as a basis for calculating annual leave. Article 66.2 of Decree 145 states that if an employee has an incomplete month of work, it will be considered a complete month if the total working days and paid leave days make up of at least half of the normal working days of the month.

Article 113.3 of the new Labour Code states that employees shall be paid in compensation for the unused annual leave days in case of employment termination or job loss. Article 67 of Decree 145 stipulates the basis for paying salary for unused annual leave days.

Instead of paying the average salary according to the labour contract of the preceding six months before employment termination or job loss (if the employee has been working for full 06 months) or the average salary according to the labour contract of the whole working time (if the employee has been working for less than six months), the salary as the basis for paying for unused annual leave days is the salary written in his/her labour contract of the month preceding the month in which the employee retires or loses his/her job.

Benefits for female employees

Similar to previous regulations, the new Labour Code stipulates that a female employee in her menstruation period is entitled to a 30-minute break every working day, and a female employee nursing a child under 12 months of age is entitled to a 60-minute break in every working day with full wage as stated in the labour contract.

Decree 145 adds more favorable regulations for female workers; accordingly, if the female employee does not need to rest and the employer allows her to work, she will be entitled to, in addition to the salary mentioned above, an extra salary that corresponds to the amount of work done by her during the rest period to which she is entitled.

Moreover, Decree 145 has a regulation that encourages employers to provide dedicated rooms for milking and breastmilk storage in the workplace if possible. If the employer has 1000 female employees or more, a room for milking and breast-milk storage is mandatory.