Terminating labor contracts in Vietnam

The labor relationship has a process of arising, changing or terminating when certain legal events occur. If entering into a labor contract is the first step in creating a labor relationship, then terminating the labor contract is the final legal event that helps the parties end the previously established labor relationship. So to terminate the labor contract, what procedures do the parties need to carry out? In the article below, Viet An Law will advise on procedures for terminating labor contracts in Vietnam according to the current law.

Legal basis

• Labor Code 2019;
• Decree 145/2020/ND-CP details and guides the implementation of several articles of the Labor Code on working conditions and labor relations.

Cases of terminating labor contracts in Vietnam

Cases of termination of labor contracts are specifically regulated in Article 34 of the Labor Code 2019, which can be divided into the following cases:

• Termination of the labor contract due to the will of both parties such as reaching the expiry of the labor contract, or completion of work according to the labor contract, both parties agree to terminate the labor contract.
• Termination of the labor contract due to the will of a third party such as when the employee is sentenced to imprisonment but is not entitled to a suspended sentence or is not eligible for release; Foreign workers working in Vietnam are deported according to legally effective court judgments or decisions or decisions of competent state agencies; the employer is a deceased individual; declared by the Court to have lost civil act capacity, to be missing or to have died; Work permits expire for foreign workers working in Vietnam.
• The employee unilaterally terminates the labor contract according to the provisions of Article 35 of the Labor Code 2019.
• The employer unilaterally terminates the labor contract according to the provisions of Article 36 of the Labor Code 2019.

Thus, in case of termination of a labor contract due to the will of both parties, the termination procedure is carried out according to the contract liquidation procedure as for a normal civil contract. The notable procedure is the procedure for unilateral termination of employment, which will be presented in the following article.

Procedures for employee unilateral termination of labor contract

Procedures for notification of termination of labor contracts for regular employees

According to Clause 1, Article 35 of the Labor Code 2019, employees have the right to unilaterally terminate the labor contract but must notify the employer in advance as follows:

• At least 45 days if working under an indefinite-term labor contract;
• At least 30 days if working under a fixed-term labor contract with a term from 12 months to 36 months;
• At least 03 working days if working under a fixed-term labor contract with a term of less than 12 months.

Procedures for notifying labor contract termination for some specific industries

According to Article 7 of the Decree 145/2020/ND-CP, specific industries, and professions include:

• Aircraft crew member; aircraft maintenance technicians, specialized aviation repair staff; flight dispatcher and operator;
• Enterprise managers according to the provisions of the Enterprise Law; Law on Management and Use of State Capital Invested in Production and Business at Enterprises;
• Seafarers working on Vietnamese ships operating abroad; Seafarers are leased by Vietnamese enterprises to work on foreign ships;

When an employee in this industry, profession, or job unilaterally terminates the labor contract, the notice period is as follows:

• At least 120 days for indefinite-term labor contracts or fixed-term labor contracts of 12 months or more;
• At least equal to a quarter of the term of the labor contract for labor contracts with a term of less than 12 months.

Procedures for notification of termination of labor contracts for domestic workers

According to Article 89 of Decree 145/2020/ND-CP, in-house workers have the right to unilaterally terminate the labor contract without reason but must give at least 15 days’ notice, except in the following cases where the employee unilaterally terminates the labor contract. Terminate the labor contract without prior notice according to Clause 2, Article 35 of the Labor Code.

Cases where the employee has the right to unilaterally terminate the labor contract without prior notice

• Not being arranged according to the correct job, working location or not guaranteed working conditions as agreed, except for the cases specified in Article 29 of the Labor Code;
• Not being paid in full or not paid on time, except for the cases specified in Clause 4, Article 97 of the Labor Code;
• Being mistreated, beaten, or subjected to humiliating words or actions by the employer, or acts that affect health, dignity, or honor; forced labor; being sexually harassed at work;
• Pregnant female employees must quit work according to the provisions of Clause 1, Article 138 of the Labor Code;
• Full retirement age as prescribed in Article 169 of the Labor Code unless otherwise agreed by the parties;
• The employer provides dishonest information as prescribed in Clause 1, Article 16 of the Labor Code, affecting the implementation of the labor contract.

Procedures for employer unilateral termination of the labor contract

Procedures for prior notification to employees

According to Clause 2, Article 36 of the Labor Code 2019, when unilaterally terminating the labor contract in the cases specified in Points a, b, c, dd, and g, Clause 1, Article 36, the employer must notify the employer. advance to employees as follows:

• At least 45 days for indefinite-term labor contracts;
• At least 30 days for a fixed-term labor contract with a term from 12 months to 36 months;
• At least 03 working days for fixed-term labor contracts with a term of less than 12 months and the cases specified in Point b, Clause 1, Article 36;
• For some specific industries, occupations, and jobs, the notice period is implemented according to the provisions of Article 7 of the Decree. 145/2020/ND-CP.

In addition, when unilaterally terminating the labor contract in case the employee is not present at the workplace after the prescribed time limit and the employee voluntarily quits the job without a valid reason within 05 working days. continuously or more, the employer is not required to notify the employee in advance.

Procedures for consultation with employee representative organizations

According to Article 177 of the Labor Code 2019, employees must agree in writing with the leadership of the employee representative organization at the facility when unilaterally terminating the labor contract, for employees who are members of the Board member of the representative organization.

Thus, in case the employer unilaterally terminates the labor contract with a member of the leadership board of a grassroots employee representative organization, it must reach a written agreement with the organization’s leadership board representative of workers. Consultation with the employee representative organization after the employer has established a labor use plan according to the provisions of Clause 1, Article 44 of the Labor Code.

Procedures for notifying state labor management agencies

This procedure is applied in cases where the employer terminates the labor contract with the employee according to Article 42 and Clause 3, Article 177 of the Labor Code 2019.

In case the employer terminates the labor contract due to changes in structure, technology, or economic reasons, according to Clause 6, Article 42 of the Labor Code 2019, dismissal of the employee is only allowed. Conducted after consulting with the employee representative organization at the facility for the place where there is an employee representative organization at the facility of which the employee is a member and notifying the provincial People’s Committee and workers 30 days in advance.

In case of unilateral termination of the labor contract for an employee who is a member of the management board of the employee representative organization at the grassroots level, Clause 3, Article 77 of the Labor Code stipulates, in case no agreement can be reached, both parties must report to the specialized labor agency under the Provincial People’s Committee. After 30 days from the date of notification to the specialized labor agency under the Provincial People’s Committee, the employer has the right to decide. In case of disagreement with the employer’s decision, the employee and the leadership of the employee representative organization at the facility have the right to request resolution of the labor dispute according to the order and procedures established by the employer.

Note

• Cases where the employer is not allowed to exercise the right to unilaterally terminate the labor contract include:
  • Employees who are sick or have an accident or occupational disease are receiving treatment or nursing as directed by a competent medical examination and treatment facility, except for the case specified in Point b, Clause 1, Article 36 of the Labor Code.
  • Employees are on annual leave, personal leave, and other leaves agreed to by the employer.
  • Pregnant female workers; Employees on maternity leave or raising children under 12 months old.
• Each party has the right to cancel the unilateral termination of the labor contract before the expiration of the notice period but must notify in writing and obtain the consent of the other party.
• Unilateral termination of the labor contract without following the prescribed procedures can lead to unilateral termination of the labor contract illegally. Accordingly, the employee or employer must fulfill the obligations according to Article 40 and Article 41 of the Labor Code 2019.

Termination of labor contracts services by Viet An Law

• Legal advice on labor contracts and procedures for terminating labor contracts;
• Support businesses in drafting labor contracts and related documents;
• Support employees in completing documents and procedures for terminating labor contracts;
• Representing clients to protect their rights when terminating labor contracts;
• Answering legal issues related to the process of implementing labor contracts as well as the process of implementing procedures to terminate labor contracts.

Above are legal issues related to procedures for terminating labor contracts in Vietnam. If you have questions or need legal advice on procedures for terminating labor contracts, as well as issues of labor law, please contact Viet An Law for the best support.