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March 27, 2020

Vietnam Strengthens Regulations Protecting Workers

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On March 4, 2020, the Government of Vietnam issued Decree No. 28/2020/ND-CP Providing Regulations on Administrative Penalties in the Areas of Labor, Social Insurance, and Sending Vietnamese Workers Abroad for Working Under Contract (“Decree 28”). Decree 28 contains 57 articles geared toward protecting Vietnamese workers, including outsourced workers.

Decree 28 sets out a number of infractions which employers should be careful to avoid committing and which can result in severe penalties.

Article 4 of Decree 28 also sets out a list of 51 specific penalties that employers may be subject to. Among these, violators may be required to do the following:

  • Return personal papers of employees;
  • Turn over monies received from outsourcing employees;
  • Pay employees their full salaries;
  • Allow employees to return to their previous jobs;
  • Pay employees full severance allowance, job-loss allowance, plus interest on the unpaid amount;
  • Pay employees a sum of money corresponding to their social insurance contribution, health insurance premium, unemployment insurance premium and annual leave allowances.

Decree 28 provides for dozens of actions which could subject an employer to a penalty, including, among others:

  • Conducting outsourcing without a proper license;
  • Keeping/withholding the personal papers of an employee (such as ID card);
  • Acting as an employment agency or making false claims about a job;
  • Failing to announce results of recruitment in a timely manner;
  • Collecting money from applicants illegally;
  • Requiring workers to undergo more than one probation period for one job or undergo probation longer than permitted;
  • Having workers work overtime more than 12 hours in a day during holidays and weekends;
  • Failing to provide training in occupational safety and occupational hygiene for workers;
  • Not allowing female workers with children under 12 months of age to rest 60 minutes a day;
  • Oppressing or retaliating against workers that organize or take part in strikes;
  • Using the license for overseas manpower supply of another enterprise to send Vietnamese workers abroad;
  • Sending workers abroad without registering the manpower supply contract.

Decree No. 28 provides monetary fines that can be applicable to employers in the case of violations. Fines as high as VND 200 million (approximately USD 8,500) for organizational violators (companies) may apply for the most serious violations. In some cases, double fines may apply.

Decree 28 enters into effect on April 15, 2020, and will replace Decree No. 95 of 2013 and Decree No. 88 of 2015 on the same subject. For more details on how this may affect your company, please contact [email protected].

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