Lawful Employee Termination: Legal Procedures in Vietnam

The procedures for legally dismissing employees in Vietnam are stipulated in the Labor Code 2019 and Decree 145/2020/ND-CP. The following article provides information on cases of employee termination, principles for handling disciplinary terminations, procedures for legally terminating employees and other relevant details for your reference.

What is termination?

Termination is one of the four forms of labor discipline as prescribed in Article 124 of the Labor Code 2019. It can be understood that termination is the highest form of labor discipline that the law allows employers to apply to employees who violate discipline in order to remove from the labor collective employees who have no sense of discipline and seriously violate business order.

Cases of legal termination of employees

According to Article 125 of the Labor Code 2019, termination is only applicable in the following cases:

• Employees who commit acts of theft, embezzlement, gambling, intentional injury or drug use at work.
• Employees who disclose business secrets, technological secrets, infringe upon the intellectual property rights of the employer, or commit acts that cause serious damage to the employer’s property.
• Employees who have been disciplined (prolonged salary raise or demotion) and re-offend during the period when the discipline has not been removed.
• Employees voluntarily quit their jobs for 05 cumulative days within 30 days or 20 cumulative days within 365 days without a valid reason. Cases considered valid reasons include natural disasters, fires, illness of the employee or a relative with confirmation from a competent medical facility, and other cases specified in the labor regulations.

Cases in which employees cannot be terminated

According to Articles 122, 123, and 125 of the Labor Code 2019, cases in which employees cannot be terminated include:

• Employees who are pregnant on maternity leave or raising children under 12 months old.
• Employees who are on sick leave, nursing leave or have received the employer’s consent to quit their job.
• Employees who are being detained, imprisoned or awaiting the results of an investigation by a competent authority.

Time limit for handling disciplinary termination of employees

• According to Article 123 of the Labor Code 2019, the statute of limitations for handling labor discipline is 06 months from the date of the violation; in case the violation is directly related to finance, assets, disclosure of technological secrets, business secrets of the employer, the statute of limitations for handling labor discipline is 12 months.
• When the prescribed time limit for subjects not subject to labor discipline in Clause 4, Article 122 of this Code expires, if the statute of limitations has expired or the statute of limitations is still valid but less than 60 days, the statute of limitations for handling labor discipline may be extended but not more than 60 days from the date of expiry of the above-mentioned time limit.

Principles of Disciplinary Termination

When discharging, employers must comply with the following principles:

• Must prove the employee’s fault.
• Must have the participation of the organization representing employees at the facility.
• Employees have the right to defend themselves and have a lawyer or representative organization defend them.
• Disciplinary action must be recorded in writing.

Lawful Employee Termination: Legal Procedures in Vietnam

According to Article 70 of Decree 145/2020/ND-CP, the procedure for handling labor discipline includes the following steps:

Step 1: Confirm the violation

• If the violation is discovered at the time of occurrence, the employer shall make a record of the violation and notify the employee representative organization.
• If the violation is discovered after the violation has occurred, evidence must be collected to prove the employee’s fault.

Step 2: Organize a disciplinary meeting

• The employer must notify at least 05 days in advance of the content, time, and location of the disciplinary meeting, the full name of the person being disciplined, and the violation.
• The meeting must be attended by all participants. If one of the participants is absent, the meeting can still proceed.

Step 3: Make minutes of the meeting

• The employer conducts the meeting to handle labor discipline according to the time and place announced. In case one of the members required to attend the meeting does not confirm to attend the meeting or is absent, the employer will still conduct the meeting to handle labor discipline.
• The content of the meeting must be recorded in the minutes and signed by the members attending. If someone does not sign, the reason for not signing must be clearly stated.

Step 4: Issue a decision to handle discipline

• Within the prescribed time limit, the competent person must issue a decision to handle discipline and send it to the employee and the organization representing the employee.

Step 5: Public announcement of the decision

• The decision to handle disciplinary action must be publicly announced to the relevant parties.
• If the person subject to disciplinary action is not satisfied, he/she has the right to complain to the employer, to the competent authority as prescribed by law or request the settlement of the labor dispute according to the procedures prescribed by law.

Notes when terminating employees

Termination is an important and highly legal decision in labor relations. To ensure compliance with legal regulations and avoid legal risks, businesses need to pay attention to the following issues:

• Legitimate reasons for termination are breach of contract, violation of the law, use of drugs, stimulants during working hours…
• Termination procedures must be carried out under legal regulations, specifically: notification of termination decision, disciplinary meeting, termination decision, payment of payable amounts…
• Evidence recording the violation, witness statements…
• Termination procedures must ensure fairness, transparency and respect for the rights of employees.
• Understand the rights of employees when fired including salary, allowances, compensation and social insurance.
• Should consult a lawyer to ensure compliance with the law and avoid risks.

Above is the consulting content of Viet An Law on Lawful Employee Termination: Legal Procedures in Vietnam. If clients need advice on procedures for terminating employees, please contact Viet An Law for support.