Employing Foreign Workers in Vietnam: Updated Requirements
The conditions for employing foreign workers in Vietnam have changed. This article highlights the key changes that foreign firms should be aware of.
On September 18, the Government of Vietnam issued Decree No. 70/2023/ND-CP, in which there are a number of updates to the requirements for hiring foreign workers. Previously foreign workers were regulated by Decree No. 152 /2020/ND-CP.
While this decree has sparked debates among businesses seeking to employ foreign staff, these incremental changes are certainly welcome news for streamlining the foreign worker hiring process.
Key changes to terminology
Though these changes are mostly semantic, they may impact specific documentation requirements during the work visa application process.
An expert is now a person who meets one of the following criteria:
- Graduated from university or higher or equivalent and have at least 3 years of work experience suitable to the job position that the foreign worker plans to work in Vietnam;
- Has a minimum of 5 years’ experience and has a certificate confirming as such, appropriate to the job position they intend to undertake; or
- Has been approved as a special case at the discretion of the Prime Minister at the request of the Ministry of Labor, War Invalids, and Social Affairs.
An Executive Director is now referred to as a CEO. To qualify for a work permit as a CEO, a foreign worker must meet the following criteria:
- Be the head of a branch, representative office, or the business location of the enterprise; or
- The person who leads and directly operates at least one area of an organization or enterprise and is subject to the direction and management of the head of the organization or enterprise.
A technical worker is now a person who meets one of the following criteria:
- Has professional training for at least one year and has at least three years of experience appropriate to the job position they are applying for; or
- Has at least five years of work experience suitable to the job position that they plan to undertake.
Getting approved to hire foreign workers
The approval process for hiring a foreign worker has been somewhat simplified according to the new decree.
Employing foreign workers (Section 1, Article 4.1)
Employers will now only need to report and explain to the Ministry of Labor, War Invalids, and Social Affairs that the position cannot be filled by a local worker 15 days in advance of the commencement of work of a foreign worker. Previously the ministry had to be notified 30 days in advance.
The timeframe within which the ministry must be notified if there is a change to the application has also been shortened to 15 days prior to the commencement of work of the foreign employee.
Also, from January 1, 2024, positions for which an organization wishes to employ a foreign worker will need to be advertised on the Electronic Information Portal of the Ministry of Labor, War Invalids, and Social Affairs (Department of Employment) or the Electronic Information Portal of the Employment Service Center. This must include the job position and job title, job description, quantity of positions to be filled, qualification requirements, experience needed, salary, working time, and location.
The use of foreign workers by contractors
Contractors employing foreign workers that would have in the past applied to the Chairman of the Provincial People’s Committee, must now apply to the Department of Labor, War Invalids, and Social Affairs. Likewise, the department is now responsible for assisting contractors to hire local workers where possible.
Foreign worker reports
The amended decree introduces a third component related to foreign worker reporting. It stipulates that if a foreign worker is mandated to work in multiple provinces within Vietnam, the Ministry of Labor, War Invalids, and Social Affairs, as well as the Department of Labor, War Invalids, and Social Affairs, must be notified within three days of the foreign worker commencing their work.
Foreign workers exempt from work permits
There are multiple cases whereby foreign workers may be exempt from acquiring a work permit to work in Vietnam.
This latest decree has redefined individuals teaching or conducting research at international schools affiliated with diplomatic missions (Section 2, Article 7.6). It has replaced the specific mention of the United Nations with ‘intergovernmental organizations’.
Article 7.14 further extends this provision to foreign workers approved by the Ministry of Education and Training for the following purposes:
- Teaching and research; or
- Serving as a manager, executive director, principal, or vice principal of an educational institution associated with a foreign diplomatic representative agency or intergovernmental organization.
Work permit applications
There are several noteworthy changes to the work application process detailed in the new decree. These are:
- If a foreign worker is required to work in multiple locations these must all be listed on the application.
- Documentation used to prove a foreign worker is a manager or executive director is now listed as: a company charter or the operating regulations of the enterprise; a business registration certificate or establishment certificate; and a resolution or appointment decision of an enterprise.
- Documentation used to prove a foreign worker is an expert or technical worker is now listed as: a diploma, and written confirmation from an enterprise abroad listing the number of years spent working as an expert or technical worker.
Work permit reform in Vietnam
Obtaining work permits has been a source of contention for both foreign and local firms seeking to employ foreign workers. The reform of these processes and procedures has been a priority for business groups, both domestic and international.
Although the changes via Decree No. 70/2023/ND-CP may appear modest, they represent a positive step toward enhancing clarity and, hopefully, expediting the processes involved.
For support with hiring foreign workers or human resources and payroll support more broadly in Vietnam, contact the visa experts at Dezan Shira and Associates.
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Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout the Vietnam and the Asian region. We maintain offices in Hanoi and Ho Chi Minh City, as well as throughout China, South-East Asia, India, and Russia. For assistance with investments into Vietnam please contact us at email@example.com or visit us at www.dezshira.com
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