Understanding what must be agreed in writing within an employment contract is essential for anyone working in Vietnam, especially foreign professionals. Under the Labour Code, every labour contract must clearly state key contract terms such as job title, salary, and contract length to protect both parties.
Whether you’re entering a fixed-term or indefinite-term employment contract, this guide explains the legal framework, helping local and expatriate workers stay compliant and confident in Vietnam’s evolving labour environment.
What Is an Employment Contract?
An employment contract, also called a labour contract in Vietnam, is a legally binding agreement agreed in writing between an employer and an employee. It specifies the job role, salary, contract terms, working conditions, and mutual rights and obligations.
Under Article 13 of the Labour Code (Law No. 45/2019/QH14), an employment contract is defined as an agreement establishing a paid working relationship between both parties. In Vietnam, the contract must generally be in writing, except in temporary jobs lasting under one month where an oral agreement is allowed.
Employment contracts in Vietnam can be fixed-term or indefinite-term, depending on the contract length and nature of the work.
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Employment Contract vs. Labour Contract
In Vietnam, an employment contract (or labour contract) is legally distinct from service or independent contractor agreements. While all are agreed in writing, they differ in terms of authority, compensation, and entitlements.
Under an employment contract, the employee works under the management and supervision of the employer. By contrast, service providers or independent contractors retain autonomy over how they complete their work. Employees receive fixed wages or salaries, whereas contractors are paid by project or service fees.
A key difference also lies in benefits. Employees under a valid labour contract are entitled to social insurance, health insurance, and paid leave, as stipulated in Vietnamese law. Independent contractors, however, are responsible for managing their own contributions and benefits.
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Different Types of Employment Contracts
The Vietnam Labour Code (Law No. 45/2019/QH14) Vietnam’s Labour Code recognizes several employment contract types, each with distinct contract terms and levels of job security. All must be agreed in writing to be valid.
1. Indefinite-term Employment Contract
This labour contract has no fixed end date and offers the highest job security. It is ideal for long-term employment relationships. Termination requires at least 45 days’ written notice unless there is a contractual breach. If two consecutive fixed-term contracts are completed and both parties continue working, the third automatically becomes indefinite.
2. Fixed-term Employment Contract
A fixed-term contract lasts between 12 and 36 months for local employees and up to 24 months for expatriates. It clearly defines the contract length and renewal date. Only two fixed-term contracts are permitted consecutively — the third must convert into an indefinite-term contract. This type suits project-based or short-term roles.
3. Probationary Contract
A probationary employment contract allows both sides to evaluate suitability before committing long term. The duration varies by job type — up to 180 days for executives, 60 for skilled professionals, and as short as 6 for basic roles. During probation, employees often receive reduced pay and limited benefits.
4. Non-Traditional Contracts
Service or cooperation agreements fall outside the Labour Code and focus on project-based work. These are common among foreign language teachers, consultants, and freelancers. While flexible, they do not include standard employee benefits such as social or health insurance.
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Key Elements in an Employment Contract
According to Article 21 of the Labour Code, a standard labour contract must include:
- Full name, address, and contact details of both employer and employee
- Job title and detailed job description
- Workplace location and working hours
- Contract length (fixed-term or indefinite-term)
- Salary, payment schedule, and any allowances or bonuses
- Social insurance, health insurance, and other benefits
- Conditions for termination or renewal
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Requirements for Expatriates in Vietnam
Foreign employees who wish to sign an employment contract in Vietnam must meet several legal conditions under the Labour Code (Law No. 45/2019/QH14) and related decrees on foreign workers. These steps ensure that the labour contract is valid and compliant with Vietnamese law.
Before signing a contract, expatriates must obtain a work permit under Decree 152/2020/ND-CP, amended by Decree 70/2023/ND-CP. Exemptions apply only to certain experts, managers, or technicians who work less than 30 days per visit and no more than 180 days per year.
Key requirements include:
- Health certificate: Must be issued by an authorized medical authority in Vietnam or abroad to confirm fitness for work.
- Qualifications and experience: Diplomas, degrees, or professional certificates must match the position offered.
- Visa or residence card: A valid DN or LD visa or temporary residence card is required to stay legally in Vietnam.
- Contract alignment: The job title, position, and employer listed in the work permit must match the details in the signed labour contract. Any inconsistency can result in penalties or work permit cancellation.
- Exempt categories: Some expatriates, such as intra-corporate transferees, foreign lawyers, or those under international treaties, may be exempt from work permits but must still register according to Decree 152.
Once these requirements are fulfilled, expatriates are eligible to sign either a fixed-term or indefinite-term employment contract, depending on the nature and duration of their role.
Read Related: Temporary Residence Card (TRC) in Vietnam: Definition, Requirements, and Validity
Common Issues and Legal Disputes
Most conflicts arise from unclear contract terms or failure to comply with agreements agreed in writing.
Breach of Contract
Disputes often occur when either party fails to meet the agreed obligations. Employers may delay payments or skip benefits such as health insurance or paid leave. Employees may breach confidentiality or fail to meet performance standards. The Labour Code treats all employment contracts — fixed-term, indefinite, or probationary — as legally binding, requiring strict compliance.
Unlawful Termination
Employers must give valid reasons and written notice—typically 30 to 45 days depending on contract length. Ending an employment contract without proper documentation or due process can lead to wrongful termination claims.
Confidentiality and Non-Compete Clauses
Many labour contracts include clauses restricting employees from joining competitors. These are only enforceable if the limits on time and geography are reasonable. Poorly defined terms can trigger legal challenges.
Unpaid Wages and Social Insurance
Failure to pay wages or contribute to social insurance is a frequent issue. Employers are legally required to pay on time and contribute to health, maternity, and retirement funds. Non-compliance may result in penalties or retroactive payments.
Probation and Work Permit Issues
Probationary periods vary by role and must follow labour laws. Some employers extend them unlawfully to avoid offering permanent contracts. For foreign employees, disputes also arise when employers fail to process or renew work permits and visas—potentially leading to job loss or deportation.
Dispute Resolution
Most conflicts begin with negotiation or mediation by trade unions or labour conciliators. If unresolved, arbitration or court proceedings follow. Legal processes in Vietnam can be slow, and foreign workers may face language barriers, making early legal guidance essential.
Conclusion
Understanding Vietnam’s employment contract system is essential for both local and foreign workers. Every labour contract must be agreed in writing, clearly outlining job duties, salary, and contract terms to ensure compliance with the Labour Code. For expatriates, meeting legal requirements such as obtaining a work permit, visa, and health certificate helps maintain a secure and lawful employment status.
Whether you are signing a fixed-term or indefinite-term employment contract, knowing your rights and responsibilities protects you from legal risks and strengthens professional trust in Vietnam’s growing labour market.
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