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Notice periods in Vietnam
Termination of employment in Vietnam
Post-termination restraints in Vietnam
Employment waivers in Vietnam
Employment policies during mergers and acquisitions in Vietnam
Offboarding without stress with CXC
End of employment in Vietnam
Ending an employment relationship in Vietnam requires careful adherence to local labour laws, especially when issuing an end of contract letter to an employee. Whether the employment ends due to contract expiry, company restructuring, or termination with cause, employers must follow regulated procedures to avoid disputes and ensure transparency.
Vietnamese labour law mandates that employees be given proper notice in writing when their contract is ending. This end of contract letter should outline the reason for the termination, the effective date, any entitlements such as unused leave or severance, and instructions for final handover. Providing a clear and respectful communication not only fulfils legal requirements but also helps maintain a professional employer brand.
When preparing an end of contract letter sample for employees, it is important to tailor the content according to the type of employment contract involved—fixed-term, seasonal, or indefinite. For instance, employees on fixed-term contracts that expire naturally may not be entitled to the same level of severance as those whose contracts are terminated prematurely due to a merger or redundancy.
Partnering with an Employer of Record (EoR) like CXC can help simplify this process. CXC ensures full compliance with Vietnamese labour laws, from drafting compliant letters to managing final payroll, benefits, and statutory payments during offboarding.
By handling contract endings with fairness, clear documentation, and professional support, employers can minimise legal risk and preserve workforce goodwill.
Notice periods in Vietnam
Navigating the notice period in Vietnam is a key part of managing employment contracts and ensuring smooth transitions in the workplace. Employers must be aware of the legal requirements around termination and resignation notices to maintain compliance and foster respectful employer-employee relationships.
Termination notice period in Vietnam
Under Vietnam’s labour law notice period provisions, notice of termination must be given in writing. The duration depends on the type of labour contract in place. For an indefinite labour contract, the required notice is 45 days. If the contract is definite, lasting between one and three years, a 30-day notice is necessary. For seasonal contracts, which are contracts of less than one year, the notice period is only three working days. It is important to note that no notice is mandated during the probation period, providing flexibility in initial hiring phases.
Resignation notice period in Vietnam
Employees resigning from their roles must also adhere to the specified notice periods to comply with Vietnamese labour regulations. Resignations generally follow the same notice durations as termination, depending on the contract type, and must be submitted in writing. This allows employers sufficient time to prepare for the employee’s departure and ensures a smoother handover process.
Probation period in Vietnam
The probation period in Vietnam is designed to match the job’s complexity and required skills. Typically, this ranges from 6 to 60 days for most roles, but for managerial positions, the probation can extend up to 180 days. The salary during this probation period must be agreed upon in writing and cannot be less than 85% of the salary paid for the permanent role. This ensures fair treatment of employees while allowing employers to assess suitability.
Severance pay in Vietnam
Employers are obligated to provide severance pay to employees who have worked continuously for 12 months or longer. The severance amount equals half a month’s wages for each year of service. Contributions to a severance fund are made monthly by both the employer and employee, from which the final payment is drawn upon termination.
Familiarity with Vietnam’s labour law’s mandated notice period rules helps employers handle terminations and resignations professionally and within legal boundaries, reducing risks and fostering a positive work environment.
Termination of employment in Vietnam
Managing the end of an employment relationship requires careful attention to legal requirements and best practices to avoid disputes and ensure fairness. Vietnam’s labour laws set out specific rules governing the termination of contracts, balancing employer rights with employee protections. Employers must approach termination with clear justifications and proper documentation to remain compliant.
Lawful vs unlawful termination in Vietnam
Vietnam’s labour law on termination establishes strict grounds under which an employer may legally end an employment contract. These include mutual agreement between parties, expiry of a fixed-term contract, unsatisfactory job performance, company restructuring, employee misconduct, or prolonged illness preventing work.
Termination must always be supported by written notice specifying the reasons. It is important to note that terminating an employee during paid leave is prohibited under Vietnamese regulations. Employers should carefully assess whether the cause for dismissal aligns with the permitted legal grounds, as failure to comply may lead to claims of unlawful termination in Vietnam.
Unlawful dismissal can occur if employers terminate without valid cause, fail to follow required notice procedures, or discriminate unlawfully. This can result in penalties or reinstatement orders, making it critical to adhere closely to the Labour Code provisions.
Best practices when terminating employment in Vietnam
To manage terminations effectively, employers should document performance issues or misconduct clearly and provide employees with opportunities to improve where applicable. Written warnings and performance reviews serve as important evidence supporting lawful dismissal.
Providing termination notice in writing, respecting notice periods, and ensuring the employee receives all due payments, including severance where applicable, promotes compliance. Employers should avoid terminating employees during protected periods, such as paid leave or maternity leave.
Consulting with legal experts familiar with Vietnamese labour law before proceeding with termination helps mitigate risks of disputes. Transparent communication, fair treatment, and compliance with procedural requirements support a smooth transition while protecting the company’s reputation and reducing legal exposure.
For more detailed guidance on Vietnam’s labour law on termination, employers may refer to official labour regulations or seek advice from specialised employment law practitioners.
Post-termination restraints in Vietnam
Employers often rely on post-termination restraints to safeguard their business interests after an employee leaves. These restraints typically include non-compete and non-solicitation agreements, which prevent former employees from engaging in competitive activities or soliciting clients and staff. However, in Vietnam, the legal environment around these post-employment restrictions is limited and somewhat unclear, making it important for employers to carefully design and enforce such agreements.
Non-competes in Vietnam
Vietnam’s Labour Code 2019 does not specifically regulate non-compete clauses, creating uncertainty about their enforceability once the employment relationship ends. Article 21.2 allows employers to require employees involved with business or technological secrets to sign confidentiality agreements during employment, including terms on compensation. These agreements are enforceable if breached while employed.
However, the Labour Code generally views labour contracts as governing only the employment period. Therefore, any non-compete provisions intended to apply after termination are usually considered unenforceable if included in the labour contract. Courts have not provided clear guidance on this, adding to the ambiguity.
To address this, employers typically draft separate civil contracts with employees to cover non-compete obligations after the employment ends. These civil agreements are treated under civil law, which allows post-termination covenants to be binding if reasonable in scope, duration, and compensation. Employers should ensure the non-compete agreements clearly define the geographic area, duration (often 6 to 12 months), and financial compensation to increase their chances of enforcement.
Non-solicits in Vietnam
Non-solicitation clauses, which prevent former employees from soliciting company clients or staff, are not specifically regulated under Vietnam’s Labour Code. Their enforceability remains uncertain and can be difficult to uphold without explicit legal backing.
Employers wanting to impose non-solicitation restrictions should also use separate civil contracts to set out the terms. Clearly defining who or what is protected, the duration of the restriction, and consequences of breach is critical. Without clear regulations, these agreements may be vulnerable to legal challenges, so legal advice is recommended when drafting.
In conclusion, while post-termination restraints like non-competes and non-solicits can be valuable, employers in Vietnam must navigate a complex and evolving legal landscape. Drafting clear, separate civil agreements and offering appropriate compensation are key to strengthening enforceability and protecting business interests.
Employment waivers in Vietnam
Employment agreements often include various waivers that can affect the rights and obligations of both employers and employees. However, when it comes to the waiver in contract law within Vietnam, employers must tread carefully, as the legal framework does not clearly support the waiver of statutory employee rights.
Employment waiver laws in Vietnam
Vietnamese labour law does not explicitly regulate the waiver of statutory rights by employees. In practice, any waiver laws that attempt to allow an employee to give up legally protected rights or entitlements, such as minimum wages, paid leave, or severance pay, are generally viewed as unenforceable. The government prioritises the protection of employee rights as outlined in the Labour Code and related regulations, making it difficult for employers to rely on waivers to circumvent these obligations.
Because statutory protections are designed to safeguard workers’ fundamental rights, courts in Vietnam tend to invalidate any contractual terms that attempt to waive such protections. This means that while employees can waive certain contractual rights voluntarily, waivers that conflict with mandatory labour standards will not be upheld.
Best practices when enforcing employment waivers in Vietnam
Given the limitations of waiver laws in Vietnam, employers should exercise caution when including waivers in employment contracts. To ensure any waiver provisions are legally sound and enforceable, it is advisable to:
- Clearly distinguish between waivers of statutory rights (which are unlikely to be enforceable) and waivers of other contractual rights or claims that are not protected by law.
- Use clear, unambiguous language in any waiver clauses to ensure that employees understand what rights they may be waiving.
- Avoid using waivers to override core employee protections, such as minimum wage, social insurance contributions, or paid leave.
- Obtain explicit, documented consent from employees when including any waiver clauses, ensuring transparency and fairness.
- Consult legal experts experienced in Vietnamese labour law to draft contracts that comply with local regulations while managing risk effectively.
In conclusion, while employment waivers can be a useful tool for managing contractual relationships, their enforceability in Vietnam is limited when it comes to statutory employee rights. Employers should prioritise compliance with the Labour Code and approach waivers carefully to avoid legal disputes.
Employment policies during mergers and acquisitions in Vietnam
Mergers and acquisitions (M&A) in Vietnam present unique challenges, especially regarding employee rights and employment policies. Employers involved in such corporate changes must carefully navigate Vietnam’s merger and acquisition regulations to ensure a smooth transition and compliance with local labour laws.
Vietnam’s merger controls
Vietnam’s merger control framework governs how companies can consolidate, merge, or restructure. When a transfer of assets, ownership change, division, consolidation, or company conversion impacts employees, specific obligations arise. The outgoing employer is required to prepare a detailed labour usage plan that outlines how the workforce will be managed post-transaction. Both the outgoing and successor employers are responsible for implementing this plan to maintain labour stability during the transition.
Labour authorities closely monitor such transactions to protect workers affected by these changes. Employers must ensure compliance with all procedural requirements, including timely notification and consultation with employees, to avoid legal risks.
Best transfer of undertaking practices in Vietnam
During a transfer of undertaking, it is critical to uphold employees’ rights and maintain transparent communication. Employers should:
- Prepare a comprehensive labour usage plan early in the process to clarify the impact on staff and future workforce management.
- Honour existing employment contracts, as Vietnam’s labour law does not automatically terminate contracts due to company restructuring.
- When employee contracts are terminated due to M&A-related changes, employers must pay a job-loss allowance. This severance is required for employees who have worked continuously for at least 12 months and is calculated based on half a month’s wages for each year of service.
- Collaborate closely with legal and HR professionals to ensure all employment changes comply with Vietnamese labour regulations and avoid potential disputes.
- Maintain clear communication channels with employees throughout the process to foster trust and minimise disruptions.
Understanding these practices helps businesses manage the workforce effectively during mergers and acquisitions while respecting employee rights under Vietnamese law.
Offboarding without stress with CXC
Ending an employment relationship in Vietnam is not as simple as giving notice. It involves clear legal steps and missing one can led to disputes, delays, or even legal claims.
From confirming valid reasons for offboarding to issuing final pay, severance, and proper exit documents, every detail matters. Business transfers, contract conclusions, or voluntary resignations all come with their own regulations. And if those are not followed, you are exposed.
That is where CXC steps in. We manage the offboarding process from start to finish, making sure everything is done by the book. No guesswork. No risks. Just a smooth, compliant exit for your business and your employee.
Need help managing workers from onboarding to offboarding? We can help.
FAQ's
What are the lawful ways an employment contract can end in Vietnam under Article 34 of the Labour Code 2019?
Article 34 allows employment to end in Vietnam through contract expiry, mutual agreement, lawful resignation or dismissal, retirement and several other circumstances set out in the Labour Code.
An employment contract can also end when the agreed work is completed, an employee dies, an employer ceases operating, or the employee is lawfully dismissed for disciplinary reasons. For foreign employees, expiry of a work permit is another specific ground for ending employment. Other grounds include a competent court declaring an employee missing or legally incapacitated, an employee receiving certain criminal sentences, and termination during or at the end of probation in accordance with the Labour Code.
Redundancies caused by restructuring, technology changes, economic reasons, mergers or similar business changes have separate requirements.
The important distinction is that having a reason to end employment does not automatically give an employer the right to dismiss someone immediately. Where the employer is terminating the contract unilaterally, the reason must fall within the permitted grounds and the applicable notice period in Vietnam must also be followed.
What notice period applies when ending employment in Vietnam?
The standard notice period in Vietnam is at least 45 days for an indefinite-term contract, 30 days for a fixed-term contract of 12 to 36 months, and three working days for a fixed-term contract of less than 12 months.
These periods commonly apply when an employee resigns and when an employer lawfully terminates a contract unilaterally, although there are exceptions where notice is not required or a different period applies. Certain specialised occupations also have separate notice rules.
For employers, the contract type is therefore one of the first things to check before setting a termination date. A 30-day notice period should not automatically be applied to every employee simply because they are on a fixed-term arrangement.
Employees can also resign without notice in specific circumstances permitted by the Labour Code, including certain cases involving unpaid salary, mistreatment or sexual harassment at work.
When is severance pay required in Vietnam?
Severance pay in Vietnam is generally due to eligible employees who have worked regularly for at least 12 months, at a rate of half a month’s salary for each year of qualifying service.
The key local detail is how qualifying service is calculated. Time already covered by unemployment insurance is deducted, as is any period for which the employee has already received severance or job-loss allowance. This means the employee’s total length of service and their severance-eligible service may be very different. Certain periods treated as working time by law can still count towards total service before the unemployment-insurance and previous-payment deductions are applied.
The salary used for the calculation is the employee’s average contractual salary during the six months immediately before employment ends.
Different rules apply to job-loss allowance where employment ends because of restructuring, technological or economic changes or certain business reorganisations. Eligible employees can receive one month’s salary for each qualifying year, with a statutory minimum of two months’ salary. The two-month minimum applies where the employee has worked regularly for the employer for at least 12 months.
What final payments must employers make when employment ends in Vietnam?
Final pay in Vietnam can include outstanding salary, payment for unused annual leave and any severance or job-loss allowance the employee is entitled to receive.
Unused annual leave is particularly important. Where an employee has not taken all of their accrued annual leave because employment ends, the employer must pay for the unused days.
Employers also need to complete the employee’s social insurance and unemployment insurance records and return original documents they have retained.
Amounts due following termination of employment in Vietnam generally need to be settled within 14 working days after the contract ends. The Labour Code allows this to extend to a maximum of 30 days in specified circumstances, including some cases involving business closure, restructuring or natural disasters.
Final payroll therefore needs to account for both ordinary earnings and employment-related amounts triggered by the departure.
How do fixed-term employment contracts end in Vietnam?
A fixed-term employment contract in Vietnam normally ends on its agreed expiry date, but allowing the employee to continue working can change what happens next.
If the employee keeps working after the end of contract in Vietnam, the parties have 30 days to sign a new employment contract. During those 30 days, the existing contract continues under its current terms.
If no new contract is signed within that period, the fixed-term contract generally becomes an indefinite-term contract automatically.
Where the parties sign another fixed-term contract, they can generally do this only once. If the employee continues working after the second fixed term, the next contract normally needs to be indefinite. There are exceptions, including certain contracts with foreign employees. Other exceptions include contracts with elderly employees, directors of state-invested enterprises and employees whose contracts are extended until the end of their term as executives of an employee representative organisation.
This makes the expiry date important in Vietnam. Employers should decide whether a role will end or continue before simply allowing a fixed term to roll over. A fixed-term contract may also need to be extended until the end of an employee representative’s term where the original contract would otherwise expire during that term.
What post-employment restrictions can employers use in Vietnam?
Employers in Vietnam can use confidentiality and trade-secret protections, but broad post-employment non-compete restrictions are not expressly regulated in the same way as confidentiality agreements under the Labour Code.
Article 21 specifically allows an employer to make a written agreement with an employee who has direct access to business or technology secrets. The agreement can cover what information must be protected, how long the protection applies, the employee’s rights and obligations, and compensation for a breach.
Non-compete clauses require more caution. Vietnam’s Labour Code does not provide a general statutory regime setting out when a post-employment non-compete is enforceable.
Employers looking to protect client relationships, confidential information or intellectual property should therefore avoid assuming that a broad restriction preventing someone from working for a competitor will automatically be enforceable. Confidentiality and trade-secret provisions have a more explicit basis under Vietnamese labour law.
What compensation is payable if an employer unlawfully terminates employment in Vietnam?
An employer that unlawfully terminates an employee in Vietnam can be required to reinstate the employee and pay lost salary, compulsory insurance contributions and at least two months’ contractual salary. The lost salary and insurance amounts cover the period during which the employee was prevented from working.
If the employee does not want to return, additional severance may also be payable where the employee qualifies for it. If the employer does not want to reinstate the employee and the employee agrees not to return, the parties can agree an additional payment. That additional compensation must be at least two further months of salary. If the employee’s former job no longer exists but the employee wishes to return, the parties must seek to amend the employment contract, and the employer must still make the other statutory payments.
There is also a specific consequence for getting the notice period wrong. If the employer gives less notice than required, it must compensate the employee for the salary corresponding to the missing notice days. The financial exposure from an unlawful dismissal can therefore extend well beyond ordinary severance pay in Vietnam.
What happens when a foreign employee's work permit expires in Vietnam?
A foreign employee’s employment contract can end when their Vietnamese work permit expires, unless they have another valid basis to continue working legally in Vietnam.
The Labour Code specifically recognises expiry of a foreign employee’s work permit as a ground for termination. Vietnam’s current foreign-worker requirements are governed by Decree 219/2025, which has applied since 7 August 2025.
This also affects contract planning. The duration of a foreign employee’s Vietnamese employment contract cannot extend beyond the validity of the work permit.
Employers should therefore monitor the immigration date separately from the normal employment contract expiry date. If the business wants to retain the employee, work authorisation needs to be addressed before the existing permit expires rather than treating it as an ordinary contract renewal. A work permit can generally be renewed only once, for a maximum renewal period of two years. Continued employment after that may require a new permit or another valid authorisation route. The rules are different where the foreign employee qualifies for a work-permit exemption.
How do employers manage compliant end-of-employment processes in Vietnam?
Employers in Vietnam should first identify the legal ground for the employee’s departure, because it determines the notice, compensation and documentation that apply.
This is particularly important when distinguishing ordinary severance from job-loss allowance. An employee leaving after a lawful individual termination may qualify for severance based on service not already covered by unemployment insurance. A qualifying employee losing their job through restructuring or certain economic changes can fall under the separate job-loss allowance rules, which provide one month’s salary per qualifying year and a minimum payment of two months’ salary.
Employers also need to check whether termination is restricted at that time. Vietnamese law limits an employer’s ability to terminate employees in certain protected circumstances, including some periods of illness, pregnancy and maternity-related leave. An employer generally cannot terminate unilaterally while an employee is receiving authorised treatment for an illness or occupational injury within the protected period, taking approved annual or personal leave, or pregnant, on maternity leave or caring for a child under 12 months. Statutory exceptions must be assessed carefully.
Redundancy cases may also require a labour-utilisation plan, consultation with the employee representative organisation and advance notice to the provincial authority and affected employees. Disciplinary dismissal requires its own meeting, evidence, representation and limitation-period requirements.
The final settlement then needs to match the legal ground used for the termination, rather than applying the same exit calculation to every employee.
Why should international companies trust CXC to manage end-of-employment compliance in Vietnam?
CXC gives international companies local support when an employee leaves in Vietnam, particularly where the correct notice, severance or termination route may be unfamiliar to an overseas HR team.
Vietnam has several areas where a global termination policy cannot simply be applied unchanged. Severance excludes periods covered by unemployment insurance, restructuring can trigger a different job-loss allowance, fixed-term contracts can convert if employment continues, and foreign employees have work-permit dates to consider.
Through our Employer of Record service, CXC can help businesses understand which local requirements apply before an exit decision is implemented and account for the resulting employment and payroll obligations.
With more than 30 years of workforce management experience and support across 100+ countries, CXC can also help international HR teams manage a Vietnam exit as part of a wider regional or global workforce programme.
Speak to our team to learn more about managing the end of employment in Vietnam with CXC.
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