Overview of foreign workers in Vietnam

Overall, the situation regarding foreign workers entering Vietnam has changed and improved a lot in the past 15 years (period 2005-2019). In 2005, the number of foreign workers in Vietnam was 12,000 people, and this number has climbed to roughly 180,000 people in 2019. 

From 2015 to 2019, there has been a major shift in the type of positions held by foreign workers. In 2019, only 12% of foreign workers held management positions, while the percentage holding expert positions rose to 56%. The decrease in the percentage of management positions is due to domestic talents taking over, while the increase in expert positions can be attributed to the future directions set by the Government.

On May 11, Deputy Prime Minister Vu Duc Dam signed Decision No. 569/QD-TTg promulgating the Strategy for Science, Technology and Innovation Development until 2030. In it, the Government specifically emphasizes the importance of attracting foreign experts and Vietnamese experts living abroad in the development of the country’s technology industries. 

One of the steps that the government has taken to make Vietnam more attractive to foreign experts is passing policies to support funding and facilitate entry/exit procedures, visas, and work permits.

Notable work permit exemption cases:

The government has taken actions to make it easier for experts to come to Vietnam through Article 7 of Decree No. 152/2020/ND-CP dated December 30, 2020 on foreign workers working in Vietnam. In it, there are 20 cases where foreign workers are exempt from work permits (full list can be found in exemption cases), notable cases include:

• The person is an intra-company transferee within 11 sectors in the plan of commitments in services between Vietnam and WTO.
• The person is sent by a foreign authority or organization to Vietnam to teach and study at an international school for a foreign diplomatic mission, the United Nations, or for a foreign facility under the authorization of Vietnam.
• The person enters Vietnam to hold the position of a manager, executive, expert or technical worker for a period of work of less than 30 days and up to 3 times a year.
• The person takes charge of establishing a commercial presence.
• The person is certified by the Ministry of Education and Training as a foreign worker entering Vietnam for teaching and research purposes.
• The person is the manager of a representative project, an international organization or a foreign non-governmental organization in Vietnam.
• The person enters Vietnam for a period of less than 03 months to do marketing for a service.
• The person enters Vietnam for a period of less than 03 months to resolve a complicated technical or technological issue which (i) affects or threatens to affect business operation and (ii) cannot be resolved by Vietnamese experts or any other foreign experts currently in Vietnam.
• The person gets married with a Vietnamese citizen and wishes to reside in Vietnam.

Permit exemption on the basis of marriage, and what companies need to know

Among the exemption cases, marriage with a Vietnamese citizen is the most different. As a result, domestic organizations and companies that hire foreign workers can be unsure on the required procedures relating to their work contracts. In these cases, companies hiring foreign workers are obligated to follow the three steps: 

Step 1: Determination of demand for foreign workers

At least 30 days before the date on which foreign workers are expected to be employed, the company shall submit dossier to determine the demand for foreign workers to the Ministry of Labor, War Invalids and Social Affairs or the Departments of Labor, War Invalids and Social Affairs where the foreign workers are expected to work.

Step 2: Apply for Certification of exemption from work permit

The company shall submit dossier to the Ministry of Labor, War Invalids and Social Affairs or the Department of Labor, War Invalids and Social Affairs of the province where the foreign worker is expected to work to certify that such foreign worker is eligible for exemption from a work permit at least 10 working days before he/she starts to work.

Step 3. Sign the labor contract with foreign workers

According to Clause 2, Article 13 of Labor Code 2019, before recruiting an employee, the company shall enter into an employment contract with such employee.

Clause 1, Article 20 of this Code, the Labor Contract must be concluded in one of the following types:

• An indefinite-term employment contract is a contract in which the two parties neither fix the term nor the time of termination of the contract;
• A fixed-term employment contract is a contract in which the two parties fix the term of the contract for a duration of up to 36 months from the date of its conclusion.

Clause 2 Article 151 of Labor Code 2019 stipulates: “The duration of a foreign employee’s employment contract must not exceed that of the work permit”. 

In this case, foreign workers who are exempted from the work permit are not constrained within this period, therefore, depending on the agreements between parties and the actual situation of the enterprise’s labor recruitment demand, enterprises can establish a labor contract with a definite or indefinite term, may sign conclusion of multiple fixed-term labor contracts.

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