Embark on a transformative journey in workforce management with this insightful guide on hiring remote workers. Tailored for businesses embracing the trend of remote jobs, we explore the global dynamics of remote careers. Dive into the nuances of online jobs and the opportunities they present in the evolving landscape of the global workforce. Specifically focused on Vietnam, this article serves as a beacon for organizations keen on unlocking the potential of remote careers in this dynamic market, blending innovative strategies with the demands of the modern workforce.

The Landscape of Remote Work in Vietnam

Responding to the transformative shifts in the workforce, Q&Me Vietnam Market Research emphasizes a notable change in the professional landscape of Vietnam. The appeal of working from home is driven by factors like improved working flexibility, a more laid-back ambiance, and the independence of self-management. This indicates a growing inclination towards embracing the advantages of remote work. Interestingly, a substantial 80% of respondents express the wish to continue some form of remote work post-pandemic, with 20% aspiring for a fully remote work arrangement. The motivations behind this preference include the elimination of commuting hassles and the paramount importance of flexibility, both in terms of time and work style. These statistics highlight a profound transformation in the work environment, with the adoption of remote careers becoming a pivotal aspect of the modern professional landscape in Vietnam.

Guide to Hiring Remote Workers in Vietnam

Legal Insights: A Guide to the Legality of Hiring Remote Workers in Vietnam

Navigating the landscape of hiring remote workers in Vietnam requires a thorough understanding of the legal aspects. The country's legal framework is adapting to the growing trend of remote work, and employers must comprehend the regulations to ensure compliance and avoid legal complications. Key considerations include taxation, labor laws, and data protection regulations. Seeking legal counsel or partnering with expert consulting firms can provide invaluable insights to navigate the legal intricacies and foster a smooth remote hiring process.

Sourcing Talent: Tips for Remote Careers in the Vietnamese Market

As the demand for remote talent grows, effectively sourcing the right candidates becomes a crucial aspect of the hiring process. Understanding the Vietnamese market and its pool of remote professionals is essential. Leverage local job platforms, professional networks, and collaborate with recruitment agencies familiar with the nuances of remote hiring. Highlighting the benefits of remote work, such as flexible schedules and a results-driven approach, can attract top-tier talent.

Employment Contracts: Ensuring Compliance and Best Practices for Remote Jobs

Crafting comprehensive employment contracts is instrumental in fostering successful remote work arrangements. Clearly outlining expectations, responsibilities, and communication protocols helps establish a foundation for effective collaboration. Additionally, addressing compliance with local labor laws, intellectual property rights, and data security in the employment contract is crucial. Employers should ensure that the contract reflects the specifics of remote work, covering aspects like working hours, communication tools, and performance metrics. Guidance from legal experts can enhance the credibility and sustainability of remote jobs, providing businesses with the framework for successful and compliant remote work engagements.

Contracting Remote Workers: Best Practices

Crafting Agreements: Best Practices for Hiring Remote Workers

Crafting robust agreements is a cornerstone of successful remote work engagements. Article 20 of the Labor Code 2021 has introduced significant changes by eliminating seasonal labor contracts and those with a term of less than 12 months. Now, employers primarily have two contract options: indefinite term and fixed term labor contracts. An indefinite term contract involves parties without specifying the contract's duration or termination time, while a fixed term contract allows parties to determine the term and termination time within a maximum period of 36 months from the contract's effective date.

Key Elements in Remote Jobs Agreements: A Comprehensive Overview

Remote job agreements are multifaceted, requiring a comprehensive approach for success. The Labor Code 2019, in alignment with technological advancements, introduces the option of entering into labor contracts through electronic means. According to Clause 1, Article 14, a labor contract entered into via electronic means, such as a data message, is legally valid and holds equal weight to traditional labor contracts. This innovation facilitates the remote hiring process, streamlining administrative tasks and enhancing efficiency.

When delving into the contents of employment contracts, employers must ensure clarity and completeness. The major contents include the employer's details, the contracting person's information, job specifics, contract duration, salary details, promotion and pay raise policies, working hours, rest periods, provisions for personal protective equipment, and crucial considerations like social insurance, health insurance, and unemployment insurance. The emphasis on basic and advanced training underscores the importance of continuous skill development for remote workers.

Addressing Challenges: Solutions for Seamless Remote Work Contracting

Navigating challenges in remote work contracting is integral to ensuring a seamless and productive collaboration. The legal framework, as per the Labor Code, provides a foundation for structuring contracts effectively. Employers should adapt to the revised contract types, understanding the nuances of indefinite and fixed-term contracts to align with business needs.

Incorporating electronic convenience into the contracting process, as endorsed by the Labor Code 2019, enables expeditious contract execution. Employers should leverage electronic means judiciously, ensuring compliance with legal requirements for data messages. With a focus on contract clarity and completeness, employers can foster a positive remote work environment, addressing challenges through proactive measures and reinforcing a robust foundation for remote work engagements.

Notes for Recruiters Engaging Remote Talent in Vietnam

Management Guidelines: Effectively Hiring Remote Workers

Effectively engaging remote talent involves navigating various regulations and establishing robust management guidelines. Recruiters must provide clear instructions on acceptable work locations, emphasizing that an employee's private home is the designated place for implementing the online working model. Should an employee choose to work from an alternative location, the employer is absolved of legal responsibilities regarding labor safety and occupational accidents during working hours.

Building Culture: Tips for Fostering a Positive Remote Work Environment

The management of remote teams extends to regulations on working time, providing flexibility for employees while ensuring efficiency. Employers can adopt a goal-oriented approach, allowing employees to manage their time based on completion deadlines rather than strict hours. This not only promotes a healthier work-life balance for employees but also exempts employers from mandatory overtime payments, provided tasks are accomplished promptly and effectively.

Challenges and Solutions: Ensuring a Smooth Experience in Remote Jobs

Ensuring the protection of business secrets and technological confidentiality holds utmost significance in the realm of online jobs. Employers should provide guidance to their workforce on information security protocols, emphasizing the utilization of company-provided equipment and tools instead of personal devices. Furthermore, establishing explicit regulations for addressing and compensating damages resulting from non-compliance with confidentiality instructions becomes a critical necessity. This pertains to situations where employees compromise business secrets or technological information, reflecting the repercussions akin to the disclosure of such confidential data.

In summary, meticulous adherence to regulations concerning work locations, innovative strategies for time management, and a steadfast commitment to securing business secrets form essential components of effectively involving remote talent in Vietnam. By following these directives, recruiters actively contribute to cultivating a positive and legally compliant environment for remote jobs.

Final Thoughts

In conclusion, this comprehensive guide sheds light on the intricacies of hiring remote workers in Vietnam. As we navigate the evolving landscape of remote jobs, it's essential to embrace the future of work and unlock the vast potential in Vietnam. Viettonkin stands as your partner, offering expertise in remote careers management. Connect with us to explore tailored solutions, strategize successful hiring of remote workers, and elevate your business in the dynamic realm of remote jobs.

In the midst of Vietnam's expanding economy, foreign businesses face challenges when it comes to the employment process and effectively utilizing local human resources (HR). The Employer of Record (EOR) emerges as a strategic solution for employers navigating the dynamic landscape of this Southeast Asian gem. Viettonkin, in this analysis, delves into the challenges faced by companies aiming for prosperity in Vietnam. From the intricacies of the HR landscape to streamlining the employment journey, we highlight the crucial role of EOR in overcoming barriers and ensuring seamless operations for global enterprises.

Difficulties facing foreign businesses entering Vietnam’s market

Navigating Vietnam's dynamic talent landscape poses a multifaceted challenge for businesses:

• The global and local competition for skilled individuals is fierce, demanding a strategic approach. Beyond the initial attraction of top talents, the true obstacle lies in securing employees that align with the company culture, fostering a harmonious work environment.
• Employee management and training, paramount for operational efficiency and risk mitigation, morph into intricate, time-consuming processes, particularly daunting for foreign companies venturing into Vietnam. The delicate balance between the urgency for swift success and the constraints of limited time and resources creates a persistent dilemma.
• The nuances of labor contracts and HR documents pose substantial risks, with non-compliance potentially resulting in fines, reputational harm, and unforeseen costs for foreign employers navigating Vietnam's dynamic regulatory landscape.

EOR – a game-changing solution for foreign businesses

For foreign businesses grappling with the intricate challenges of recruitment and management in Vietnam, the emergence of Employer of Record (EOR) introduces a transformative paradigm. Instead of independently maneuvering through the complexities of the local labor landscape, companies can opt for the strategic support of EOR services. EOR assumes a crucial role by overseeing the entire spectrum of recruitment, training, and employee management, bringing specialized expertise to bear on aspects such as contracts, tax compliance, and regulatory updates. Acting as the legal employer, EOR navigates the intricacies of taxes and labor laws, affording foreign companies the freedom to retain control over day-to-day operations and employee relationships. This streamlined and collaborative approach not only significantly reduces the intricacies of HR processes but also serves as a catalyst for enhanced market access and simplified international payroll procedures. In essence, EOR stands as a comprehensive solution, empowering employers in Vietnam with a strategic framework for seamless operations and sustained success.

Foreign businesses gain substantial benefits from EOR

Employer of Record (EOR) services go beyond the conventional hiring process, offering a multifaceted suite of advantages crucial for foreign businesses venturing into new markets, especially in Vietnam.

• Visa and Work Permits: In navigating the intricate landscape of immigration, EOR takes charge of securing essential visas and work permits, streamlining the process for expatriates joining your workforce.
• Compliance: EOR ensures that the acquisition of young talents aligns seamlessly with the intricate tapestry of Vietnamese laws and regulations, safeguarding your operations from legal pitfalls.
• Legal Procedures: From the intricacies of labor contracts and payroll to insurance, personal income tax, benefits, and treaties, EOR meticulously manages the entire spectrum of legal procedures. This includes staying abreast of the latest labor laws, ensuring your business remains in compliance.
• Dispute Resolution: EOR plays a pivotal role in expertly handling and resolving disputes among employees, allowing for a harmonious work environment and mitigating potential disruptions.

By proactively assuming the recruitment responsibilities, EOR alleviates concerns related to company registration and foreign labor applications, enabling foreign companies to swiftly initiate operations in Vietnam. Leveraging a profound understanding of the local market and labor force, EOR efficiently shortlists qualified candidates, saving substantial time and effort. Moreover, EOR facilitates market entry by conducting cost-effective market research, identifying potential distributors, and establishing relationships with clients or partners. As a comprehensive solution, EOR remains vigilant in ensuring that foreign companies adhere to local regulations, shielding them from potential sanctions arising from evolving employment policies. With EOR, foreign businesses not only streamline their entry into the Vietnamese market but also fortify their foundation for long-term success.

Where to find high-quality EOR service in Vietnam?

Backed by a decade of industry leadership in Vietnam, Viettonkin stands as the foremost consulting firm dedicated to fast-tracking the triumph of foreign enterprises and investors in the vibrant Vietnamese market. Acknowledging the time-sensitive intricacies that accompany venturing into a new country, we provide an all-encompassing array of solutions meticulously crafted to streamline the complexities inherent in employment and related matters. Armed with profound insights into Vietnam's labor market, coupled with extensive proficiency in payroll, taxes, and legislative dynamics, Viettonkin emerges as your unwavering partner for unparalleled Employer of Record (EOR) services. Our commitment goes beyond comprehension of your unique requirements; we specialize in delivering tailor-made solutions with utmost efficiency.

Strategically engineered to prioritize both speed and quality, our EOR service at Viettonkin acts as a catalyst in expediting your talent acquisition process. This approach empowers you to swiftly establish a strong foothold in Vietnam's dynamic market, enabling the initiation of business operations within a matter of days. Additionally, our dedication extends to the swift resolution of any disputes that may arise from employees we recruit on your behalf. Moreover, we guarantee a seamless market withdrawal, alleviating concerns related to labor contracts and regulatory intricacies. Choose Viettonkin as your strategic ally to navigate the intricate landscape of the Vietnamese business environment, where our comprehensive expertise ensures not only swift market entry but also a secure foundation for sustained success.

Final thought

Select Viettonkin as your committed ally in navigating Vietnam's business complexities. With our unmatched expertise and dedication to excellence, we expedite your market entry, offering a steadfast framework for enduring success. Connect with us today, initiating a journey where your business flourishes seamlessly in the dynamic Vietnamese market. With our tailored solutions and deep understanding of the local landscape, Viettonkin ensures your venture is positioned for triumph in every aspect of human resource and employment processes through the support of our Employer of Record services.

Navigating Vietnam's labor market in Q3 of 2023 requires a profound understanding of the intricacies that define this dynamic landscape. In this article, we'll delve into the key trends, challenges, and opportunities within Vietnam's labor market for this quarter, shedding light on crucial insights, particularly concerning employment rates. As the workforce landscape continuously evolves, it's essential for businesses, job seekers, and policymakers to remain informed about the ever-changing dynamics in the labor market in Vietnam.

Key Trends and Insights in Vietnam's Labor Market

Labor Force and Skills Development in Vietnam

In the third quarter of 2023, Vietnam's labor force aged 15 and older continued to expand, reaching an estimated 52.4 million individuals. This figure marks an increase of 92.6 thousand people compared to the previous quarter, demonstrating the ongoing dynamism of the labor market in Vietnam. Moreover, there's a remarkable growth of 546 thousand people compared to the same period last year. The labor force participation rate remained robust at 68.9%, the same as the previous quarter, but up by 0.2 percentage points compared to the same period last year. Of significance, the proportion of trained workers holding degrees and certificates witnessed an increase, rising by 0.5 percentage points from the last quarter, and an overall increase of 1 percentage point.

Employment in Vietnam was a cornerstone in the third quarter of 2023, with an estimated 51.3 million people being employed. This represents an increase of 87.4 thousand people compared to the previous quarter, indicating a growing Vietnamese labor market. Over the same period last year, there was a substantial increase of 523.6 thousand employed persons, showcasing the sector's resilience and expansion.

Unemployment and Underemployment in Vietnamese Labor Market

As reported by the General Statistics Office (GSO), during the third quarter of 2023, the unemployment rate in Vietnam's labor market among the working-age population remained 2.3%, with no change compared to the previous quarter. However, there was a slight increase of 0.02 percentage points from the same period the previous year. Zooming out to a broader perspective, the unemployment rate for the initial 9 months of 2023 was 2.28%, reflecting a decrease of 0.07 percentage points compared to the same period in the previous year. This change is particularly notable, with urban areas registering a 2.73% unemployment rate, while rural areas reported a slightly lower rate of 2%.

Concurrently, the underemployment rate for the working-age population in the third quarter of 2023 stood at 2.06%, showing stability when compared to the preceding quarter but exhibiting a rise of 0.14 percentage points when measured against the same period last year. Over the course of the first 9 months of 2023, the underemployment rate reached 2.02%, marking a decline of 0.27 percentage points compared to the same period the previous year. These underemployment statistics shed light on the nuances and shifts within Vietnam's labor market.

Income Developments in Vietnam's Labor Market

In accordance with the "Socio-Economic Situation In The Third Quarter And Nine Months Of 2023" report, the labor market in Vietnam witnessed income advancements in the third quarter of 2023. During this period, the average income of workers reached 7.1 million VND per month, showcasing a significant increase of 146 thousand VND compared to the second quarter of 2023. These rising income trends signify positive economic shifts. When analyzed in the broader context of the first 9 months of 2023, the average income of workers amounted to 7 million VND/month, a growth of 6.8% and an equivalent of 451 thousand VND compared to the same period the previous year. These positive income dynamics reflect the economic vitality and opportunities within Vietnam's labor market.

Challenges and Opportunities in Vietnam's Labor Market

The integration of Vietnam into the ASEAN Economic Community (AEC) and various Free Trade Agreements (FTAs) has ushered in both prospects and challenges for job seekers.

Opportunities for Job Seekers in Vietnamese Labor Market

The International Labor Organization (ILO) and Asian Development Bank (ADB) conducted a study revealing that AEC's influence on Vietnam's GDP is projected to lead to a 14.5 percent growth by 2025, accompanied by a 10.5 percent increase in the number of jobs. Furthermore, with the European Union-Vietnam Free Trade Agreement (EVFTA) in effect, job demand for skilled workers is estimated to surge by 28 percent, while low-skilled workers will see a 23 percent increase, and highly skilled workers will experience a 13 percent rise. These developments signify a golden opportunity to enhance the livelihoods of millions.

The Institute of Labor Science and Social Affairs anticipates that, thanks to EVFTA, Vietnam is poised to witness the creation of 18,000 to 19,000 additional jobs annually between 2021 and 2030, primarily within the production and service sector. The demand for workers will be most prominent in four key industries: electronics and IT, mechanical engineering, chemicals-plastics-rubber, and food and foodstuff processing, together constituting 21 percent of the job market. Meanwhile, the remaining 79 percent of demand will be distributed across nine other business and service fields, covering a wide spectrum of opportunities.

Challenges Faced by Job Seekers in Vietnamese Labor Market

While opportunities abound, job seekers must navigate certain challenges in Vietnam's dynamic labor market. The advent of Industry 4.0 implies that businesses must adapt to new, high-tech production processes, necessitating workers with professional and technical qualifications, alongside a diverse skill set.

The AEC and EVFTA have fostered an 'open labor market' that enables workers to explore job prospects across member countries. Eight specific occupations, including accountants, architects, medical practitioners, nurses, dentists, technical consultants, surveyors, and those in the travel industry, enjoy the freedom of movement within ASEAN, facilitated by mutual recognition agreements. However, with the increased labor mobility, market competitiveness becomes a paramount concern. Vietnamese workers find themselves competing with international professionals in their own homeland, underscoring the significance of continuous skill development and adaptation.

Preparing for the Future of Vietnam's Labor Market

Predicting Future Trends in Vietnamese Labor Market

The landscape of Vietnam's labor market is ever-evolving, and anticipating future trends is crucial for both job seekers and employers. The continued integration into the global economy and the digital age is set to drive significant shifts. The growth of Industry 4.0 and the demand for professionals with digital and technological skills will remain at the forefront. Furthermore, the expansion of e-commerce, financial technology will create numerous opportunities. Environmental sustainability and clean energy industries will also play a pivotal role, emphasizing the significance of eco-friendly and green job skills. Thus, understanding these trends is the first step in preparing for the labor market's future.

Strategies for Upskilling and Reskilling

To remain competitive in Vietnam's labor market, upskilling and reskilling are essential strategies. Both job seekers and employers must acknowledge the importance of continuous learning and development. For job seekers, enhancing digital literacy, learning new languages, acquiring technical competencies, and mastering soft skills are crucial steps. Employers, on the other hand, should invest in employee training programs to bridge skills gaps. Collaborations with educational institutions and vocational training centers can facilitate upskilling initiatives.

The government, too, has a role to play. It can provide incentives and policies that encourage lifelong learning and foster a culture of adaptation. Financial and non-financial support to educational and training institutions will be fundamental in preparing the workforce for the dynamic labor market. In conclusion, as Vietnam's labor market embraces change and innovation, the ability to forecast trends and adapt through upskilling and reskilling will be the linchpin to future success.

Final Thoughts

In summary, Q3 of 2023 has yielded key insights into Vietnam's labor market, showcasing a dynamic landscape marked by opportunities and challenges alike. With the influence of international agreements and the growing labor force, it's essential for job seekers and employers to adapt to the changing terrain. To excel in Vietnam's labor market amidst intensifying employment rates, individuals and businesses must prioritize upskilling and reskilling. Viettonkin, with its deep understanding of the labor market in Vietnam, serves as a trusted partner to guide you through these intricacies. For expert advice and to harness the full potential of Vietnam's labor market, connect with Viettonkin, your gateway to a prosperous future.

With low wages, high accident risks, and the algorithmic demands of the employer, running around the rain-soaked streets of Ho Chi Minh City (Vietnam) has quickly worn out 35-year-old Linh Nguyen. She is part of an overworked delivery workforce that is interconnected in the seasonal economy across Southeast Asia.

Linh said, there have been blessed days when work flows consistently to her phone, and kind customers have uplifted her spirits. But on bad days, her body aches from continuous driving for 10 hours, and the monthly income is only a meager 240-280 USD. This amount is not sufficient to cover the risks on the road and compete for customers.

Linh, a ShopeeFood driver, stated, “With the earnings I make, I can only cover my rent and monthly expenses. I cannot support my parents”. After six months, she is currently seeking new employment.

Driven by Asia's online ordering trend,  which has seen significant growth during the pandemic, major companies from Grab and Shopee in Singapore to Gojek in Indonesia and Line in Japan have transformed consumer habits by connecting, moving, delivering, and creating millions of new jobs.

From the congested traffic streets of Bangkok to the bustling roads of Jakarta and the narrow lanes of Ho Chi Minh City, now all stand out day and night with the distinctive jackets of delivery service companies, handling food, shopping, parcels, and even people throughout the city.

This field has provided employment opportunities for women seeking flexible part-time jobs, a second job for students, and new opportunities for low-skilled workers who may be willing to leave their jobs at factories.

However, critics argue that it is also creating a race to the bottom, creating a culture of less responsibility from employers, poor working conditions, excessively high platform fees, and a work environment in which too many people are competing with each other for too few orders. However, companies with delivery applications are becoming increasingly wealthy. They charge fees from delivery drivers, as well as the stores and restaurants that they serve.

According to the Modor Intelligence Report, in Vietnam alone, the ride-hailing sector is predicted to generate around 1 billion USD this year and is expected to rise to 2.61 billion USD by 2028. The research indicates that Thailand's ride-hailing market is valued at 2.26 billion USD and is projected to reach 4.6 billion USD within the same timeframe, while Indonesia's market is valued at 2.67 billion USD and is anticipated to exceed 4.66 billion USD.

However, many contracted shippers are becoming increasingly dissatisfied with their work as freelancers without labor protections, having to bear the risks of navigating through hazardous roads.

“For many drivers nowadays, it's really difficult to earn a decent income,” said 26-year-old Gojek driver Khang Nguyen from Ho Chi Minh City, speaking to This Week In Asia.

Khang left his job at a factory three months ago to embrace the flexibility of the gig economy, but he's ready to quit after receiving only 5 million VND (205 USD) per month for the strenuous work of 11 hours a day. Furthermore, he mentioned, "At night, there are some really frightening deserted roads".

A 2023 survey by the global salary comparison website Sala Explorer reveals that drivers using ride-hailing apps in Vietnam, working on a standard 48-hour week, earn an average of 4.91 million VND per month after deducting expenses. This figure is slightly higher than the minimum wage of 4.68 million VND.

However, this minimum wage, which has gradually increased to its current level from 4.4 million VND in 2020, still does not apply to independent freelancers in Vietnam, classified as independent contractors and therefore they are obligated to work longer hours.

In addition to low income, those participating in this gig economy report that they do not receive many benefits afforded to regular employees, such as employer contributions to social security, maternity and paternity leave, annual leave, or overtime pay – along with other benefits like food and transportation allowances.

There is no comprehensive data on workers in the delivery model (shipper) in Vietnam, but it is estimated to be around 600,000 people, according to estimates by the Investment newspaper sponsored by Vietnam's Ministry of Planning and Investment.

In Vietnam, drivers using applications often only receive accident insurance. Meanwhile, according to a report from the Vietnam General Confederation of Labor, access to social welfare programs and health insurance remains low for young drivers.

In summary, this could lead to serious consequences.

An Ha, an IT student at a public university in Hanoi, works as a part-time Grab driver to financially support his parents in the countryside. He says, “The traffic here operates on the principle of being fast and nimble. Even when I don't make mistakes, accidents can still happen”. Ha has purchased his own health insurance and pays extra for the months when he works more.

Responding to questions about protective measures for shippers, Grab stated in a statement that they provide "a comprehensive insurance package" of welfare programs, including "free job-related insurance for our partners".

Foodpanda also stated that they provide personal accident insurance for all shippers.

Singapore, the hub of major platforms like Grab and Shopee, has shown a willingness to address some of the issues that have arisen among platform workers. One approach is to allow representative agencies – similar to labor unions – to operate so that shippers can have better conditions.

Similarly, five shippers died on Singapore's roads within 18 months. Last year, the Singapore's government sought to enhance labor protection by establishing a program for workers' injury compensation. Ultimately, it will reimburse 75% of the mandatory contributions for workers under 30 years old, known as the Central Provident Fund, in their first year of employment.

While welcomed, shippers note that the downward trajectory of income post-pandemic is making this gig economy unsustainable in one of the world's most expensive cities.

Alvin Tan, 36 years old, recently decided to work part-time after activating the app at 10 a.m. and having to wait nearly 12 hours before receiving his first order.

“There are a lot of new shippers. The supply and demand are mismatch", he said. "Recently, I only completed a few orders each day, perhaps a maximum of five orders”.

In Thailand, where the cost of living is lower but competition is fierce like in Singapore, tech-based drivers are routinely attacked by angry taxi drivers for picking up passengers too close to their gathering locations.

But the apps are also a lifesaver for many residents who are glued to the internet and feel traffic is too congested to venture out.

Former taxi driver - Paisit Jetkranboonchoo, who earned the title of "Hero" by running 300 trips in a month, said that Grab has revolutionized how he works by actively seeking customers, with rewards for extra effort and overtime.

“They even reward you when you drive in the city during peak hours,” he told This Week in Asia.

While he pays for his own insurance, Paisit said that the freelance job suits him well and comes with "very good perks," including discounts for coffee, gasoline, and etc.“You can installments through Grab to get a new phone.  I'm thinking I'll get an iPhone soon ... the installment amount is only 100 baht (2.70 USD) per day.”
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Source: SCMP.

In the fast-paced and dynamic business environment of Vietnam, having an efficient and well-structured HR system is more critical than ever. As companies expand their operations and compete for top talent in this thriving market, the need to set up a human resource system in Vietnam that aligns with local regulations and international standards has become paramount.

Vietnam's business landscape is evolving, with increased globalization, a younger and tech-savvy workforce, and changing labor laws. Navigating this complexity while ensuring compliance and optimizing HR processes can be challenging. That's where the expertise of HR system setup comes into play.

Understanding the Challenges and Solutions for HR System Setup in Vietnam

Vietnam's thriving business environment presents numerous opportunities for growth and expansion. However, it also brings forth several challenges that necessitate a robust HR system. Here, we explore the significance of setting up a human resource system in Vietnam and the challenges that businesses encounter in this context.

Regulatory and Compliance Challenges

Navigating Vietnam's intricate labor laws and compliance requirements can be daunting for both local and foreign businesses. The country's legal framework is constantly evolving, and staying updated is crucial to avoid legal complications. Establishing an HR system that ensures compliance with local regulations while adhering to international standards is imperative for long-term success.

Vietnam's labor laws encompass a wide range of aspects, including employment contracts, working hours, minimum wages, social insurance, and taxation. Staying compliant with these regulations is essential to avoid penalties and disputes that can negatively impact business operations.

Talent Acquisition and Retention in Vietnam

Vietnam boasts a young and dynamic workforce, but the competition for top talent is fierce. Effective talent acquisition and retention strategies are vital for businesses aiming to secure the best professionals. An adept HR system can streamline recruitment processes, identify suitable candidates, and implement employee retention programs to keep valuable talent within the organization.

In a highly competitive job market, companies need to differentiate themselves to attract and retain skilled employees. Offering competitive salary packages, professional development opportunities, and a positive workplace culture are essential components of a successful talent retention strategy.

Adapting to Cultural Differences

Vietnam's rich cultural diversity is a hallmark of its society, and this extends to the workplace. Businesses must be sensitive to cultural nuances and adapt their HR practices accordingly. An HR system that integrates cultural awareness and inclusivity fosters a harmonious work environment and enhances employee morale and productivity.

Understanding Vietnamese cultural norms, communication styles, and social hierarchies is crucial for effective HR management. Moreover, recognizing and celebrating cultural festivals and holidays can contribute to a more cohesive and engaged workforce.

Key Components of an HR System in Vietnam

To establish an efficient HR system in Vietnam, businesses need to focus on key components that contribute to effective human resource management.

Recruitment and Onboarding

Recruitment and onboarding are pivotal processes for businesses in Vietnam, where the competition for top talent is fierce. In a dynamic job market, attracting the right candidates requires a well-structured approach. HR system setup services play a vital role in this phase by providing the technological infrastructure needed for efficient recruitment.

These services assist in posting job vacancies on various platforms, including online job boards and social media. They also offer Applicant Tracking Systems (ATS) that help businesses manage candidate applications, schedule interviews, and perform background checks. Moreover, they can provide data-driven insights into the most effective recruitment channels and strategies, helping companies optimize their hiring processes.

Once candidates are selected, a seamless onboarding process is essential. HR systems offer tools to streamline the onboarding experience, including digital document management for contracts and employee handbooks. This ensures that new hires receive all necessary information and complete essential forms promptly.

Payroll and Benefits Management

Payroll and benefits management require precision and compliance with Vietnamese labor regulations. The Vietnamese government has established a number of labor regulations that govern minimum wage requirements, working hours, and benefits for workers in Vietnam. These regulations are designed to protect the rights of workers and to ensure that they are treated fairly. 

Minimum wage requirements, working hours, and benefits are all important factors that should be included in company regulations which are the rules and procedures that govern the workplace. They are typically set by the employer and are designed to ensure that the workplace is safe and productive.

By including these factors in company regulations, employers can ensure that they are complying with the law and that they are providing their employees with the benefits they are entitled to.

Minimum wage requirements

The minimum wage in Vietnam is set by the government and varies by region. The following are the minimum wage requirements from July 01, 2022:

• Ho Chi Minh City and Hanoi: 4,68 million dong (around $192) per month
• Da Nang: 4.16 million dong (around $170) per month
• Other regions: 3.25-3.64million dong (around $133-$150) per month

The minimum wage is reviewed and adjusted on an annual basis.

Working hours

The standard working hours in Vietnam are 8 hours per day and 48 hours per week. 

Article 109 of the Labor Code 2019 outlines provisions for rest breaks during working hours in the following manner:

• An employee engaged in at least 6 hours of work per day, as stipulated in Article 105 of the Labor Code 2019, is entitled to a rest break lasting a minimum of 30 consecutive minutes. 
• For night work, this rest break extends to a minimum of 45 consecutive minutes. If a shift spans at least 6 consecutive hours, the rest break is considered part of the total working hours.
• Beyond the rest break detailed in Section 1 of Article 109 of the Labor Code 2019, employers are required to identify additional short breaks and specify them in the internal labor regulations.

Overtime pay

Overtime is permitted, but the number of overtime working hours of the employee does not exceed 50% of the normal working hours in 01 day. 

In case of weekly work, the total normal working hours plus overtime working hours shall not exceed 12 hours in 01 day, and 40 hours in 01 month.

The total overtime working hours do not exceed 200 hours in 01 year and 200 hours in 01 year in the specific fields, works, jobs as manufacture, processing of textile, garment, footwear, electric, electronic products, processing of agricultural, forestry, aquaculture products, salt production; generation and supply of electricity, telecommunications, refinery operation; water supply and drainage and some special cases regulated.

On June 23, 2015, the Ministry of Labor, War Invalids and Social Affairs issued Circular No. 23/2015/TT-BLĐTBXH on guidelines for some Articles on salaries of Decree No. 05/2015/NĐ-CP.  

Overtime pay equals (=) actual pay per hour or per product of a normal working day multiplied by (x) at least 150% or 200% or 300% multiplied by (x) number of additional hours or additional products.

The rates of 150%, 200%, and 300% are specified in Article 98 of the Labor Code 2019. In particular, an employee who works overtime will be paid an amount based on the piece rate or actual salary as follows:

• On normal days: at least 150%;
• On weekly days off: at least 200%;
• During public holidays, paid leave, at least 300%, not including the daily salary during the public holidays or paid leave for employees receiving daily salaries.

Benefits

In addition to the minimum wage, employees in Vietnam are entitled to a number of benefits, including:

• Social, Health & Unemployment Insurance (SHUI)

• Health insurance: The rate of health insurance is 4.5% of the employee's monthly salary. The employer is responsible for paying 3% of the employee's salary, and the employee is responsible for paying 1.5% of their salary.
• Unemployment insurance: The rate of unemployment insurance is 2% of the worker's monthly salary. The employer is responsible for paying 1% of the worker's salary, and the worker is responsible for paying 1% of their salary.
• Compulsory Social insurance: The employer is responsible for paying 17.5% of the employee's salary, and the employee is responsible for paying 8% of their salary.

The total contribution rate of SHUI is 32% of the employee's monthly salary. The employer is responsible for paying 21.5% of the employee's salary, and the employee is responsible for paying 10.5% of their salary.

Please note that these rates are subject to change. The most recent rates were announced in July 2023.

• Paid sick leave: Employeesare entitled to 30-60 days of paid sick leave per year  which depends on each situation. This leave can be used for any type of illness, including both short-term and long-term illnesses.
• Paid maternity leave: Female employees are entitled to 6 months of paid maternity leave. This leave can be taken before or after the birth of the child.
• Paid paternity leave: Male employees are entitled to a maximum of 14 days of paid maternity leave depending on each situation.. This leave can be taken to care for the newborn child.

Performance Evaluation and Management

Performance evaluation and management are essential components of HR system setup. An effective system provides tools for setting performance goals, conducting regular assessments, and facilitating constructive feedback.

HR systems enable managers to create performance appraisal processes tailored to their organization's needs. They offer templates for defining key performance indicators (KPIs) and competencies relevant to each role. This data-driven approach ensures that performance evaluations are objective and aligned with the company's goals.

Performance management features within HR systems allow managers to track employee progress, provide feedback, and set development goals. This continuous feedback loop fosters employee growth and identifies high-potential individuals who can contribute significantly to the organization's success.

Training and Development

Investing in employee training and development is crucial for building a skilled and adaptable workforce. HR systems support these initiatives by streamlining the planning, tracking, and evaluation of training programs.

HR systems can help businesses identify skills gaps within their workforce, enabling them to tailor training programs to address specific needs. This ensures that training efforts are targeted and result in a more competent workforce.

Additionally, HR systems can automate training registration, track attendance, and manage training records. They also facilitate e-learning and online course management, allowing employees to access training materials conveniently. A well-structured training and development strategy, supported by HR systems, enhances employee engagement and reduces turnover.

Labor Relations and Compliance

Maintaining positive employee relations and ensuring compliance with labor laws are essential for long-term success in Vietnam's competitive labor market. HR systems provide tools to foster effective communication, manage employee grievances, and ensure legal compliance.

Effective communication is crucial for resolving workplace issues and promoting a healthy work environment. HR systems often include features such as employee self-service portals, where employees can access information, submit leave requests, and communicate with HR departments. This transparency and accessibility improve employee satisfaction and engagement.

Additionally, HR systems facilitate grievance management by allowing employees to report issues and track their resolution. These systems maintain a record of grievances and resolutions, which can be invaluable for preventing similar issues in the future and demonstrating compliance with labor regulations.

Moreover, HR systems help companies adhere to labor regulations through automated compliance checks and alerts. They can generate reports to ensure that employment contracts/agreements, working hours, and other labor-related matters comply with Vietnamese law. This reduces the risk of legal issues and penalties, safeguarding a company's reputation and financial stability.

Final Thoughts

In the rapidly evolving business landscape of Vietnam, establishing a robust human resource system is not just a necessity; it's a competitive advantage. Overcoming challenges in compliance, talent acquisition, cultural adaptation, and more is essential for success.

Viettonkin specializes in helping businesses set up comprehensive HR systems in Vietnam. With our expertise and experience, we empower organizations to navigate the complexities, ensuring seamless operations and compliance with local regulations.

Are you ready to elevate your company's HR in Vietnam? Contact Viettonkin today, and let's embark on a journey of efficiency, compliance, and growth together.

In the dynamic landscape of Vietnamese business, effective talent management services have become paramount. With its burgeoning economy, Vietnam is a hotspot for growth, making talent management a critical component for sustained success. At Viettonkin, we understand the unique challenges and opportunities within this vibrant market.

As a leading authority on talent management services in Vietnam, we have honed our expertise to provide holistic talent solutions tailored to the Vietnamese context. In this article, we delve into the intricacies of talent management, exploring strategies that empower businesses to thrive. Join us on this journey to unlock the full potential of talent in the heart of Southeast Asia.

Viettonkin’s Expertise in Talent Management

Viettonkin stands at the forefront of delivering top-notch talent management services in Vietnam. Our commitment to providing comprehensive solutions sets us apart in the industry.

At the heart of our approach lies a holistic view of talent management. We understand that effective talent management encompasses not only recruitment but also development and retention. Our services cover the entire talent lifecycle, ensuring that you have the right people in the right roles at all times.

What truly differentiates Viettonkin is our ability to blend local insights with global talent management excellence. We recognize that the Vietnamese market is unique, and our strategies are tailored accordingly. Yet, we don't stop there. Drawing from international best practices, we infuse a global perspective into our services.

Our success is rooted in our unwavering commitment to Talent Acquisition Strategies, Talent Development Programs, and Talent Retention Strategies. Through a combination of local expertise and a global mindset, we provide you with the tools to navigate the intricate talent landscape in Vietnam.

As a result, our clients not only excel in talent management but also gain a competitive edge in the Vietnamese business arena. We measure our success by the growth and prosperity of the businesses we partner with.

Navigating Challenges in Talent Management

The Vietnamese business landscape is a dynamic arena filled with opportunities and challenges. To excel, it's crucial to employ effective strategies and practices that can give your organization a competitive edge in Vietnam.

Effective Talent Acquisition Strategies

Leveraging Local Expertise

Many foreign companies operating in Vietnam opt for local expertise through work contracting or project-based hiring. This offers flexibility and cost-effectiveness during market exploration or product development phases. For this purpose, companies often rely on the services of a third party, such as Viettonkin Consulting, which provides comprehensive Staff Augmentation services, including Professional Employment Organization (PEO), Employees of Record (EOR), and Payroll Administration.

Building Strong Employer Branding

Employer branding is pivotal for multinational enterprises in Vietnam. Given the intense competition for top talents, establishing a robust employer presence is essential. Strategies include harnessing social media, partnering with universities for talent fairs and internships, and targeted advertising campaigns. In this competitive landscape, foreign companies must position themselves as appealing destinations for Vietnam's highly qualified, globally-ready young professionals.

Timing Matters

Understanding Vietnam's recruitment calendar is critical. Key milestones, such as university graduations in May and September, significantly impact recruitment success. Strategic planning that aligns with these timelines is essential for optimizing recruitment outcomes.

Performance-based Hiring

Performance-based hiring, which extends beyond skill-based methods, represents a paradigm shift in the recruitment process. While skill-based hiring focuses on evaluating candidates based on their mastery of specific skills, typically assessed through proven track records, live demonstrations, or placement tests, performance-based hiring centers on assessing  candidates' achievements and career progress. 

We believe that attracting exceptional candidates involves creating a compelling Employee Value Proposition (EVP) that positions the role as a stepping stone in one's career. This shift requires a comprehensive evaluation process, emphasizing "doing" and "becoming" over transactional considerations.

Our method focuses on role-specific performance objectives, fostering conversations that align candidate career growth with success. This approach widens the candidate pool, considering diverse individuals and high performers.

In essence, Performance-Based Hiring flips the hiring process by emphasizing "doing" and "becoming," minimizing the focus on "having" and "getting." We start by defining what a candidate must do to succeed at their job, not just the skills they should possess. This approach broadens the talent pool, ensuring a match between candidates' career progression and company success.

Talent Development Programs for Growth

Leading FDI firms and MNCs in Vietnam excel in crafting prestigious talent programs, notably flagship Management Trainee Programs. These multi-year initiatives set clear development milestones and robust career paths, attracting top-tier applicants from Vietnamese universities.

Graduate Recruitment Programs

These programs target recent graduates, offering them entry-level positions and structured training programs. MNCs often hire graduates from top universities in Vietnam. For example, PwC Vietnam, EY or Deloitte have an annual graduate recruitment program called “Fresh Graduate Recruitment Programme”, targeting recent graduates for entry-level positions and provide comprehensive training.

Internship Programs

Internship programs provide students and recent graduates with hands-on experience in a specific industry or role. MNCs use internships as a pipeline for future full-time hires. At IBM Vietnam, internship programs for students and recent graduates are open. These programs allow interns to gain practical experience in areas like technology and consulting. In addition, Internship Programs in Viettonkin aim to recruit and train talents for new projects, enhance Viettonkin's employer branding, and prepare interns as Reserve Human Resources.

Leadership Development Programs

Designed for high-potential individuals, leadership development programs groom future leaders within the organization. Participants undergo specialized training and mentoring to prepare them for leadership roles. VinaMilk is a Vietnamese leading dairy corporation with a widespread presence globally. The corporation has the Management Trainee Program for 18 months, targeting potential future leaders. This program attracted over 1,500 top talents from universities nationwide in 2020.  

At Viettonkin, we also have a 2-year Management Trainee Program, offering certified training, engaging job rotations, and a clear trajectory towards senior management positions.

Talent Development and Training Programs

These programs focus on upskilling and developing existing employees. MNCs invest in continuous learning opportunities to ensure their workforce remains competitive and aligned with industry trends. A notable example is ABB Vietnam with its annual “Apprenticeship Program” to attract, train and retain talents from engineering majors. 

Mentorship Programs

Mentorship programs pair experienced employees with newer recruits. Big MNCs like Unilever, Nestles, Microsoft Vietnam have formal mentorship programs to facilitate knowledge transfer and professional development among its employees.

Furthermore, “Succession Planning Programs'' in Viettonkin are designed to develop current managers and high-contributing individuals into future leaders and C-level executives. These programs establish comprehensive, long-term Learning & Development initiatives.

Technology-Driven Recruitment

Leveraging advanced technologies, such as artificial intelligence and data analytics, MNCs optimize their recruitment processes. Applicant tracking systems, online assessments, and video interviews are common components. FPT Corporation is a leading technology company in Vietnam that uses advanced technologies in its recruitment process - the SIS (Smart Interview System). With this technology, the corporation can filter approximately 25,000 out of 42,2000 applicants with suitable profiles, constituting a 59% success rate. Hence, this streamlines the screening process, significantly saving time, resources, and costs associated with applicant assessment and interviews.

Ensuring Talent Retention with Strategies in Vietnam

Talent Retention Essentials

Talent retention is as crucial as acquisition and development. In Vietnam's competitive job market, keeping your top talents is paramount. Successful strategies involve fostering a work environment that encourages growth, engagement, and loyalty.

Tailored Career Progression Plans

Developing clear and individualized career progression plans for your employees is essential. Vietnamese talents, like professionals worldwide, seek advancement opportunities. Offering a well-structured career path within your organization can significantly enhance retention rates.

Competitive Compensation Packages

Competitive salaries and benefits packages are essential retention tools. MNCs operating in Vietnam recognize this and often tailor their compensation to attract and retain top talents.

Employee Engagement Initiatives

Engaged employees are more likely to stay. Strategies such as regular feedback, mentoring programs, and involving employees in decision-making processes contribute to higher job satisfaction.

Professional Development Opportunities

Investing in ongoing professional development not only enhances employee skills but also demonstrates your commitment to their growth. Offering training and educational opportunities can be a powerful retention strategy.

Work-Life Balance

Maintaining a healthy work-life balance is increasingly important for employees. Ensuring reasonable working hours and providing support for employees' well-being can enhance retention.

Final thoughts

In shaping effective talent management strategies in Vietnam, talent management services play a pivotal role. These services, including Talent Acquisition, Development, and Retention, are essential in navigating the dynamic Vietnamese job market.

At Viettonkin, we excel in providing talent management services tailored to your specific needs. With our deep understanding of the local landscape and global best practices, we bridge the gap between talent and success.

Explore how Viettonkin can elevate your talent management efforts and drive sustainable growth. Contact us today for personalized solutions that empower your business to thrive in Vietnam and beyond.

In the ever-evolving landscape of modern business, Human Resource (“HR”) compliance stands as a foundational pillar of success. Ensuring that your organization adheres to the intricate web of regulations and guidelines in Vietnam is paramount. 

As businesses continue to expand globally, the need for meticulous HR compliance setup becomes increasingly apparent. The Vietnamese market, in particular, presents unique challenges and opportunities that necessitate a deep understanding of local regulations and labor laws. 

Understanding HR Compliance

HR compliance is a multifaceted concept encompassing various aspects crucial for businesses operating in Vietnam. 

Definition of HR compliance

The law does not specifically define the meaning of HR compliance. At its core, HR compliance refers to the adherence to the legal regulations and ethical standards governing human resources matters within an organization. It entails comprehensive policies and practices that ensure the treatment of employees aligns with requirements in compliance with local regulations and policy of the Company. For companies in Vietnam, understanding and implementing HR compliance is vital to navigate the complex labor landscape effectively and avoid arising labor disputes.

Importance of HR compliance in Vietnam

HR compliance holds importance in Vietnam because the Vietnamese government has a number of labor laws that employers must comply with. These laws cover a wide range of topics, including minimum wage, working hours, benefits, and discrimination.

Failing to comply with HR regulations can have severe repercussions. It may lead to legal disputes, financial penalties, and damage to a company's reputation. Real-world examples illustrate how companies, both small and large, have faced substantial legal issues and financial losses due to non-compliance. These instances emphasize the urgency of establishing a robust HR compliance system in Vietnam to safeguard your organization from potential pitfalls.

Building Systems for HR compliance

There are a number of systems that can be used to ensure HR compliance in Vietnam. These systems include:

Employee Handbooks

One effective method to establish and communicate HR compliance in Vietnam is through well-structured employee handbooks. These handbooks serve as essential tools to educate and inform employees about HR policies and procedures. They should meet the following criteria:

• Clarity: Employee handbooks must be clear, concise, and easily understandable by all employees. Clarity ensures that everyone comprehends the organization's HR policies.
• Content: An ideal handbook should cover crucial topics, including minimum wage standards, working hours, employee benefits, anti-discrimination measures, and grievance procedures.

Training Programs

Ensuring HR compliance also involves comprehensive training programs designed to educate employees continually. These programs should be regularly updated to reflect any changes in HR policies and procedures. Topics to include in training are:

• Organization's Policies: Employees should receive training on the organization's HR policies and procedures, ensuring they understand and adhere to them.
• Vietnamese Labor Laws: To comply fully, employees should also be educated about relevant Vietnamese labor laws.
• Grievance Handling: Training should include instructions on how to file grievances, creating a transparent process for dispute resolution.

Regular Audits

To confirm HR practices align with legal requirements, regular audits are crucial. Independent parties can conduct these audits to ensure objectivity. Audits should cover various areas, including:

• Payroll Records: Auditing payroll records helps verify that salary and compensation align with legal standards.
• Timekeeping Records: This aspect ensures accurate tracking of working hours, essential for compliance with labor laws.
• Discrimination Complaints: Audits should investigate any discrimination complaints to ensure fair and equal treatment of employees.
• Grievances: Reviewing grievance procedures and their outcomes ensures that employees' concerns are adequately addressed, contributing to a compliant HR system.

A successful case of setting up HR compliance system in Vietnam

During our time growing the HR Intelligence practice of Viettonkin, we have had the chance to support a large Fortune Global 500 corporation in their efforts to set up a comprehensive HR system for their Vietnamese entity. The strategic and fundamental HR strategy adopted by this corporation shed light on crucial elements of HR management that foreign investors can draw inspiration from. 

The corporation is dedicated to taking a proactive approach with detailed legal research under our support and guidance, which underscores the significance of localized HR strategies. Upon this research, the corporation decided to work with our local HR consultants to draft a comprehensive set of Company Regulations, pursuant to local relevant authorities, as well as spending 2-3 months working on crucial employment contract templates that captured the nuances of the local regulations. Ensuring compliance with the Vietnamese Labor Code was crucial, but at the same time, the corporation also had to balance that with its global practices and business goals. The corporation emphasized the creation of employment contracts in both Vietnamese and English, accommodating cultural and legal requirements of the locality. They provided a comprehensive framework for structuring roles, compensation, and benefits while also addressing topics such as work hours, leave policies, and probation periods.

Having exerted efforts to craft a strong strategy, in the later implementation phases, the corporation opted for retaining our local services of payroll administration and management to reduce their in-house admin burdens, and focused internal resources on the business growth in the Vietnam market.

Viettonkin's Expertise in HR Compliance

Viettonkin offers dedicated HR compliance services that empower businesses to navigate the intricacies of Vietnamese labor laws and regulations. With our expertise, we help organizations:

• Stay Informed: We stay at the forefront of regulatory changes, ensuring that our clients are always aligned with the latest legal requirements.
• Risk Mitigation: Partnering with us helps mitigate compliance risks, reducing the likelihood of costly legal disputes and penalties arising from non-compliance.
• Custom Solutions: Viettonkin tailors compliance strategies to the unique needs of each client, providing personalized solutions for diverse industries.
• Focus on Core Operations: By entrusting compliance tasks to us, businesses can shift their focus back to core operations, improving overall efficiency and productivity.
• Scalability: As businesses grow and evolve, HR compliance requirements may change. Viettonkin can readily adapt to these shifts, ensuring ongoing compliance.
• Proven Success: With a track record of assisting numerous businesses in achieving and maintaining HR compliance, Viettonkin is a trusted partner in the field.

Final Thoughts

In the dynamic landscape of Vietnam's business environment, maintaining HR compliance is an indispensable facet of sustainable operations. As explored throughout this article, the intricacies and significance of HR compliance cannot be underestimated. From defining compliance to understanding its impact, developing strategies, and the pivotal role of HR compliance services, businesses must prioritize adherence to regulations.

Viettonkin stands as a steadfast partner, providing tailored solutions to establish and maintain HR compliance. With our extensive expertise, we assist businesses in navigating the complexities of Vietnamese labor laws, ensuring that compliance becomes a seamless and strategic asset.Don't leave HR compliance to chance. Contact Viettonkin today to set up a robust HR compliance system in Vietnam, safeguarding your business and fostering sustainable growth.

Leaders of the renowned Huawei Group recently expressed their keen interest in fostering a digital ecosystem within Vietnam in addition to their desire to build digital infrastructure and accelerate industry digitalization and smart digital transformation in this country. During a meeting with Prime Minister Pham Minh Chinh on September 16, Huawei's representatives -  including the President of the Asia-Pacific Region Simon Lin, the Chairman of China Transportation Construction Group Vuong Dong Tru and the Deputy General Director of China Energy Construction Group Ngo Van - discussed their ambitious plans to contribute to Vietnam's digital transformation and infrastructure development. Huawei's Vision for Vietnam's Digital Future.

Prime Minister Pham Minh Chinh highly appreciated the global business investment activities of these corporations and affirmed that the Vietnamese Government will continue to provide favorable conditions for foreign businesses to operate effectively, successfully and sustainably in Vietnam.

Huawei’s vision for Vietnam’s digital future

Mr. Simon Lin, President of the Asia Pacific Region of Huawei Technology Group, outlined Huawei's vision, which encompassed several key facets: building digital infrastructure, accelerating industry digitalization, reducing carbon emissions and boosting intelligent digital transformation in Vietnam. Most importantly, he expressed the desire to develop a digital talent ecosystem in the country. 

Referring to the approval of the National Digital Transformation program until 2025, with a vision to 2030 of the Prime Minister, Mr. Simon Lin highlighted the efforts and strategies for digital transformation, building a digital government, society and economy in Vietnam.

Vietnam's support and incentives

Prime Minister Pham Minh Chinh warmly welcomed Huawei's proposals and expressed his support for the group's investment activities in Vietnam. He emphasized that the field of digital transformation presents immense opportunities for collaboration and growth. The Prime Minister also highlighted the importance of stability and cooperation in an era of constant technological advancement and fierce global competition. This includes investment and R&D activities, and improving modern management capacity. He asked Huawei Group to proactively coordinate with ministries, sectors and localities to seek new projects and investment opportunities. 

Huawei's impact in Vietnam so far

Huawei's contributions to Vietnam's technology landscape have already been substantial. The company has collaborated with local telecommunications carriers to build and upgrade networks, including 2G, 3G, and 4G. Through these endeavors, Huawei has created thousands of jobs in the information and communications technology (ICT) sector and has trained over 18,000 Vietnamese digital professionals.

Interest in developing infrastructure in vietnam

Apart from Huawei, other Chinese corporations also showcased their commitment to Vietnam's development, considering this one of the most important markets. The China Transport Construction Group, led by Chairman Vuong Dong Tru, expressed interest in high-speed railway projects and various infrastructure initiatives within Vietnam. Notably, the group has already successfully executed over 20 projects, including bridges, roads, ports, and energy ventures across key cities and provinces.

Prime Minister Chinh welcomed the group's enthusiasm and encouraged foreign businesses, particularly Chinese enterprises, to expand their activities in Vietnam's transport and energy infrastructure sectors. This encompasses the construction of high-speed railways, expressways, airports, and seaports, signaling a promising era of growth and collaboration.

Energy China's green ambitions

Leaders from the China Energy Construction Group (Energy China) also presented their plans for business expansion in Vietnam. Their focus lies in the development of wind power projects in multiple provinces, including Ha Tinh, Ninh Thuan, and Quang Tri. Prime Minister Chinh expressed his appreciation for these proposals and urged Energy China to prioritize digital transformation, green initiatives, and infrastructure development in Vietnam. He emphasized that “investors’ success is also the country’s success” and promoted the spirit of “harmonious benefits, shared risks”. 

Final thoughts

The recent discussions between Vietnamese leaders and Chinese corporations signify a crucial step toward enhancing Vietnam's digital landscape and infrastructure. These partnerships hold the potential to accelerate the nation's growth, stimulate the economy, and provide valuable opportunities for its workforce. As these initiatives unfold, Vietnam stands poised to embrace a promising era of technological innovation and sustainable development.  Contact Viettonkin today if you are ready for your investment journey as a tech provider. Our team of experts will provide you with local intelligence and guide you through the process of investing into the dynamic market of Vietnam and other ASEAN countries.

Source: vietnamnet

Professional Employer Organizations (PEOs) are growing in popularity as a form of partnership between a client (often a foreign-invested enterprise in a new market or a mid-sized business) and a professional service provider to handle all matters related to human resources management in a flexible and cost-efficient arrangement. 

Definition

PEO stands for Professional Employer Organization, which refers to a service providing firm that enters into employment relationships with employees on behalf of their clients. These employees work for the client, but are legally employed by the PEO, which enables the PEO to provide a one-stop HR solution for the client. 

In other words, the PEO functions in replacement of an HR department, performing a comprehensive HR-related scope of work, including but not limited to: payroll administration, compensation and benefits (C&B), SHUI management, HR compliance, and recruitment and training. This is why it is common to see PEO services also being referred to as co-employment, HR outsourcing, or personnel outsourcing services. 

Even though the employees are recorded under the PEO for tax and legal purposes, the clients retain full authority over their workforce and do not delegate any business decision-making to the partnering PEO.

Services within a PEO arrangement

A standard PEO engagement with Viettonkin Consulting consist of several or all of the following solutions:

• Payroll Administration & PIT Filing
• Local SHUI Consulting & Management
• Labor Market Research
• Compensation & Benefits (C&B)
• Talent Recruitment, Management & Development
• HR Compliance & Contracting
• Data Analytics & Reporting
• Ad-hoc HR Support

Why should foreign investors work with PEOs?

PEOs offer great flexibility for foreign investors starting a business in a new market, who are often in the early stages of market expansion and lack a full range of HR capabilities as well as knowledge of the local labor market and its prevailing practices. With PEOs, clients shall sign a service contract with the service provider, which proceeds to sign direct employment contracts with the employees and thus are legally liable for them. As clients are not directly employing such employees, they are also not required to establish a local entity and are able to opt for signing a service contract with the local PEO using their global entities. This reduces time, costs, and resources for many foreign investors who are exploring or researching new markets. 

Further, co-employment partnerships relieve foreign investors from the burden of building an in-house HR team and committing to formal employment relationships with a new local team that could change as fast as their business strategy in unfamiliar territories. Attempting to apply a DIY approach to HR matters in a new geography could also be highly costly, as a result of a lack of understanding regarding local labor regulations, taxes, social contributions, and other related issues - which can eventually amount to penalties and a damaged employer brand in this market.

As a result, the client can focus 100% of their efforts on their business development and other core activities, while entrusting most, if not all, HR matters to the designated PEO. At Viettonkin, our local HR experts are able to synergize and align with global HR teams of our multinational clients, enabling more optimal business decisions with well-informed inputs from the local market.

Why is Viettonkin your trusted PEO partner for SEA markets?

Viettonkin Consulting is a leading FDI-focused consulting firm based in Southeast Asia, providing a one-stop solution hub for foreign investors around the world. Our team of HR experts and consultants have 10 years of experience helping Fortune Global 500 and other major multinational corporations with their HR-related matters upon entering the new global markets. Our clients include corporations from the United States, Canada, South Korea, Europe, Singapore, Hong Kong, and other developed markets looking to enter Vietnam, Indonesia, Thailand, and other emerging Southeast Asian destinations. Schedule a free 15-min call with us today to discuss your business and human resources expansion plans.

Managing a  company’s payroll internally can be quite daunting, especially in an emerging market like Indonesia where laws and regulations are often changing. Even the slightest mistakes in accounting can eventually cost a lot of money. This is where payroll outsourcing services from consulting firms such as Viettonkin come in handy.

Why You Need Payroll Outsourcing Services in Indonesia

Despite payroll being a non-core activity, this time consuming task is still very crucial to your company’s sustainability. For foreign business owners, administering payrolls can become more challenging because of Indonesia’s different and complex payroll rules, diverse language requirements, and distinctive in-country support.

Some investors may believe that handling payroll in-house is more cost-effective. However, in many cases and over time, getting payroll outsourcing services is actually more convenient and cost-effective. In order to maintain in-house payroll administration, businesses need to invest a lot of resources and time to not only hire and train payroll employees but also acquire an effective and secure payroll software. 

By hiring a reliable agency that specializes in these kinds of services, you have a much higher chance of maintaining good results at a lower cost, not having to deal with legal problems personally, and keeping the salaries confidential to employees in your company. Furthermore, the time you save by outsourcing payroll services can be better spent on developing strategies, increasing sales, and expanding the business. 

How Can Viettonkin Assist You in Payroll Administration

Viettonkin's payroll outsourcing services are flexible and comprehensive, allowing you to ensure that salaries, Jamsostek (the private sector's social insurance fund), and relevant taxes are calculated in accordance with applicable legislation and paid and remitted on time.

Our payroll services are as follows:

• Take-home pay calculation and transfer based on data provided;
• Monthly employee income tax preparation, payment, and submission, as well as monthly BP Jamsostek;
• Salary slips preparation and distribution;
• Social security contribution
• Preparation of withholding tax summaries and certificates of withholding tax;
• Annual income tax preparation, payment, and submission for employees, including the preparation of tax forms for each employee (1721-A1);
• Administering employee leave, loans, pensions, and other benefits.

Contact Viettonkin for Fast and Reliable Payroll Services in Indonesia Today

It is not easy to achieve consistent in-house payroll administration results in Indonesia. Therefore, when it comes to smooth payroll processing, having a trusted partner can be critically important.

At Viettonkin, we have a dedicated team of experts who can provide the best payroll system for your business. Rest assured that your accounting records for payroll and employee taxes are always up to date and in compliance with applicable local regulations.

Manage your business easily with the help of fast and reliable payroll services from Viettonkin. Contact us today.