Hiring in Vietnam
Hiring in Vietnam in 2026 is cheaper than Singapore, more regulated than the headline rate suggests, and more administratively involved than most APAC Finance teams expect.
Hiring in Vietnam in 2026 is cheaper than Singapore, more regulated than the headline rate suggests, and more administratively involved than most APAC Finance teams expect.
The biggest surprise for foreign employers is not the social insurance rate. It is the combined employer-side statutory cost of 23.5% of contributable salary across four streams, including a 2% Trade Union Law 2012 levy that is owed whether or not a grassroots union exists in the office. That figure reshapes any APAC cost model imported from Manila, Jakarta, or Bangkok, because none of those markets carry a parallel union levy. Once social insurance, health insurance, unemployment insurance, the 2% union levy, foreign worker permit cycles, and severance under Article 46 of the Labour Code 2019 are factored in, the true cost of employing someone in Vietnam is noticeably higher than the headline rate. Vietnam still has one of the deepest engineering and contract-manufacturing talent pools in ASEAN, and the Law on Social Insurance 2024 widened the substance test on 1 July 2025 to cover part-time work and "any agreement under another name". That reduces the room foreign employers used to have to engage senior Vietnamese hires as consultants outside the social insurance net. This guide explains what hiring in Vietnam actually costs in 2026, how Vietnamese payroll and employment rules work, and when it makes sense to use an Employer of Record (EOR), set up your own IRC/ERC subsidiary, or hire contractors instead.Vietnam at a glance
Hiring an employee on a VND 50,000,000 monthly salary typically adds around VND 11,030,000 per month in mandatory employer costs, mainly through BHXH social insurance, BHYT health insurance, BHTN unemployment insurance, and the 2% trade union levy. Our Vietnam payroll and employment facts set out the BHXH, BHYT and BHTN rates, the regional minimum wages and the statutory severance allowance, each with its official source and date.
Total employer-side statutory cost is 23.5% of contributable salary across four streams, with the contribution base capped at 20 times the reference level (VND 46,800,000 per month from 1 July 2025) for BHXH and BHYT, and 20 times the regional minimum wage for BHTN.
For small teams, an EOR is usually more cost-effective than setting up your own Vietnamese subsidiary. The local entity tends to make financial sense between 20 and 50 hires, depending on the sector and whether you are targeting industrial park or high-tech zone tax incentives.
Regional minimum wages under Decree 74/2024 run from VND 4,960,000 in Region I (Hanoi, Ho Chi Minh City) down to VND 3,450,000 in Region IV, giving you a noticeable cost lever within a single country.
The biggest 2025 change was the Law on Social Insurance 2024 (effective 1 July 2025), which extended compulsory coverage to part-time work and engagements described under other names where the substance is paid employment.
Vietnam-registered EOR providers worth shortlisting
Multiplier
APAC-rooted provider with deep Vietnamese coverage. Handles Region I to IV minimum wage mapping and the BHXH contribution cap correctly by default.
Deel
Vietnamese entity with full BHXH/BHYT/BHTN handling, automated trade union levy remittance, and work permit support for foreign hires.
Remote
Owned Vietnamese entity with flat-fee pricing. Contract templates handle the Article 46 pre-2009 and post-2009 severance split cleanly.
Why do international companies hire in Vietnam?
Vietnam is not the cheapest ASEAN labour market on every line, and our editorial team has never said otherwise. It ends up on the shortlist for five specific reasons that come up again and again in what we hear from companies hiring in Vietnam.- Manufacturing-grade engineering depth. The IT and BPO workforce crossed 1.5 million in 2024 (MOLISA), and Samsung, Intel, LG, and Foxconn each run operations of several thousand people. The supply-chain shift out of mainland China since 2020 has thickened the contract-manufacturing layer noticeably.
- Salaries 30 to 40% below Singapore. A mid-level software engineer in Ho Chi Minh City costs USD 1,200 to 1,800 a month gross in 2026. The same role in Manila is USD 1,800 to 2,500, and in Singapore USD 4,400 to 6,700.
- Regional wage spread inside one country. The Region I to Region IV minimum wage map gives you a second cost lever. A customer support hire in a Region IV city costs roughly 30% less than the same role in Ho Chi Minh City before the EOR fee.
- English fluency at upper-mid level for technical roles. Written technical English for software engineering, QA, and DevOps is broadly comparable to regional peers. The gap to Filipino voice work has narrowed since 2022.
- ASEAN time-zone bridge. Hanoi and Ho Chi Minh City sit at GMT+7, covering the APAC working day and overlapping European mornings until 16:00 local time. Paired with a Latin America hub, that gives 24/5 coverage from two jurisdictions.
What are the employer costs of hiring in Vietnam?
The main employer costs in Vietnam are Social Insurance at 17.5% employer plus 8% employee, Health Insurance at 3% plus 1.5%, Unemployment Insurance at 1% plus 1%, and the 2% Trade Union Law 2012 levy that applies even where no grassroots union exists. On a VND 50,000,000 monthly salary, core employer costs typically add around VND 11,030,000 a month, or roughly 22.1% of gross at that band. Once foreign worker permit cycles and severance under Article 46 of the Labour Code 2019 are factored in, the true employment cost is higher than the headline rate suggests. The table below shows the typical cost structure for a VND 50,000,000 monthly hire in Vietnam.| Cost line | Employer rate | Employee rate | Contribution base or cap |
|---|---|---|---|
| BHXH (social insurance) | 17.5% | 8% | Capped at 20x reference level (VND 46.8M/month from 1 Jul 2025) |
| BHYT (health insurance) | 3% | 1.5% | Same 20x reference cap as BHXH |
| BHTN (unemployment insurance) | 1% | 1% | Capped at 20x regional minimum wage (Region I cap VND 99.2M) |
| Trade Union levy (Law 2012) | 2% | 0% | Same salary fund as the BHXH base |
| Severance (Article 46 Labour Code 2019) | ~Half month per year | n/a | Pre-1 Jan 2009 service only; post-2009 covered by BHTN |
| PIT (employee, employer withholds) | n/a | 5-35% progressive | Personal deduction VND 11M/month + VND 4.4M per dependant |
| 13th-month bonus (customary) | ~8.33% | n/a | Contractual rather than statutory, but enforceable after 3+ years |
| Total statutory employer cost | 23.5% | 10.5% | On contributable salary, before cap mechanics |
What changed in Vietnam for 2025 and 2026?
Six changes that affect any 2026 hiring plan for Vietnam, in order of how much they move the budget or the compliance picture.| Change | Effective date | What it does | Action for HR/Finance |
|---|---|---|---|
| Law on Social Insurance 2024 (Law 41/2024/QH15) | 1 Jul 2025 | Compulsory BHXH extended to part-time workers, non-salaried managers, and any engagement described under another name where the substance is paid employment | Review any consultant or contractor structure used to engage senior Vietnamese hires outside the BHXH net |
| Decree 219/2025/ND-CP (foreign workers) | Aug 2025 | Replaced Decree 152/2020 and Decree 70/2023; tightened the 30-day recruitment-portal attestation; revised the expert and manager categories | Build the 30-day portal posting into the offer timeline and refresh any template language that still references Decree 152/2020 |
| Decree 74/2024/ND-CP (regional minimum wage) | 1 Jul 2024 | Region I VND 4,960,000; Region II VND 4,410,000; Region III VND 3,860,000; Region IV VND 3,450,000 | Update BHTN cap calculations (20x regional minimum wage) and the offer-letter floor |
| Pension qualification threshold lowered | 1 Jul 2025 | Cut from 20 years to 15 years of contributions | Adjust retention modelling for mid-career Vietnamese hires |
| Trade Union Law amendment | 1 Jul 2025 | Carried the 2% employer levy forward and clarified the higher-level union flow where no grassroots union exists | Confirm the EOR quote shows the 2% line separately from BHXH/BHYT/BHTN |
| Personal Income Tax overhaul (draft) | 1 Jul 2026 (scheduled) | Revised bands and deductions per the Ministry of Finance draft published December 2025 | Add a tax-treatment review clause to any 2026 contract that straddles the change date |
What employment laws should you know before hiring in Vietnam?
The Labour Code 2019 (Law 45/2019/QH14) is the operative statute, sitting on top of the Law on Social Insurance 2024, the Trade Union Law 2012 as amended, and a layer of decrees that change more often than the primary law. A provider quoting a "Vietnamese standard" without naming the contract type (fixed-term or indefinite) and the renewal count is hiding the Article 20 second-renewal rule, which converts a fixed-term contract to indefinite by operation of law. Probation periods are capped by Article 25 job category, and applying the 180-day executive ceiling to a software engineer is a contract drafting error that voids the probation from day one.| Standard | Statutory minimum | Article reference | Practical note |
|---|---|---|---|
| Working week | 48 hours / 8 hours per day | Article 105 | Collective agreements and company policy may set 40 or 44; check the contract |
| Overtime cap | 40 hours/month, 200 hours/year | Article 107 | 300 hours/year is allowed for textiles, electronics, seafood, and seasonal sectors |
| Overtime premium | 150% weekday, 200% rest day, 300% holiday | Article 98 | Night work (22:00 to 06:00) adds 30% on top of the regular wage |
| Probation cap | 6/30/60/180 days by job category | Article 25 | 180 days only for narrowly defined executives under the Enterprise Law |
| Annual leave | 12 working days + 11 public holidays | Article 113 | +1 day per 5 years of service; Tet alone takes 5 public days |
| Sick leave (BHXH) | 30-70 days/year by contribution length | Law on Social Insurance 2024 | Longer for hazardous occupations; paid at 75% of the contribution-base salary |
| Maternity leave | 6 months at 100% via BHXH | Article 139 | +30 days for each additional child in multiple births |
| Paternity leave | 5 to 14 days depending on birth circumstances | Law on Social Insurance 2024 | Paid via BHXH; non-transferable; within 30 days of birth |
| Notice periods | 3 days / 30 days / 45 days | Article 36 | Under 12-month fixed / 12-36 month fixed / indefinite-term |
| Fixed-term renewal limit | One renewal, then indefinite-term | Article 20 | The second renewal converts to indefinite by operation of law, regardless of the contract text |
| Severance (Article 46) | Half month per year for pre-2009 service | Labour Code 2019 Article 46 | Post-2009 service is covered by BHTN, not the employer |
Should you use an EOR or set up an entity in Vietnam?
The numbers are more specific than the usual "30 to 50 employees" rule of thumb. The right answer depends on whether your hires are in a sector with foreign-ownership caps and whether the plan targets industrial park or high-tech zone tax incentives.| Factor | EOR | Own Vietnamese subsidiary (IRC/ERC) |
|---|---|---|
| Minimum capital | None (provider's entity) | No statutory minimum, but must fund operations to a level the licensing authority will accept |
| Setup time | 5 to 10 business days (Vietnamese nationals) | 3 to 5 months end to end (IRC + ERC + tax code + bank account) |
| First-year cost | USD 400-700/month per hire | USD 8,000-15,000 (legal and licensing) + USD 20,000-35,000 (compliance) |
| Annual run-rate from year 2 | USD 400-700/month per hire (flat) | USD 20,000-35,000 plus a retained Vietnamese chief accountant |
| Break-even headcount | Cheaper at 1 to 29 hires | Cheaper from 30+ or in a sector-restricted activity |
| Foreign-investment industry restrictions | Sidesteps WTO-commitment caps | Advertising, logistics, distribution, and e-commerce face foreign ownership caps |
| Tax incentives (industrial park, high-tech zone) | Cannot be passed through | 4 years at 0% + 9 years at 5% + 15 years at 10% in qualifying cases |
| FX repatriation | Not applicable | Requires audited statements and a General Department of Taxation clearance certificate |
| Work permit sponsorship | Yes, where the EOR is the registered employer under Decree 219/2025 | Yes, with the substance test applied to the subsidiary as the employer |
| Local payroll competence required | Low (provider-side) | High (retained chief accountant once the Accounting Law thresholds are met) |
Decision rule
Choose an EOR if:
- Your Vietnamese headcount is between 1 and 29 hires
- The sector faces foreign-ownership caps under WTO commitments
- You need a foreign-national hire live in 4 to 8 weeks (work permit under Decree 219/2025)
- You do not yet have a Vietnamese chief accountant or a DOLISA relationship
Set up your own Vietnamese subsidiary if:
- Your headcount is 30 or more, or the sector is restricted
- The plan targets industrial park or high-tech zone tax holidays
- FX repatriation rhythm is part of the operating model
- Your Vietnamese operation is permanent enough to absorb a multi-month wind-down if you ever close it
What are the biggest compliance risks when hiring in Vietnam?
Three risks, in order of how often they catch our readers out: contractor reclassification under the post-July 2025 substance test, missed trade union levy remittances, and the unilateral termination remedy applied by the Industrial Court. Contractor reclassification reaches further than most APAC frameworks. The Labour Code 2019 applies a subordination test under Article 22 covering employer direction of work methods, economic dependence, integration into the employer's organisation, and continuity of engagement. The Law on Social Insurance 2024 widened that test from 1 July 2025 to cover "any agreement under another name" where the substance reflects paid work, wages, and employer management for one month or more. Reclassification liability covers back-payment of BHXH, BHYT, and BHTN at 23.5% employer plus 10.5% employee, plus PIT under-withholding, plus the 13th-month bonus where contractually expected, plus annual leave cash conversion, plus Article 46 severance for any pre-2009 period in scope. The contract label does not protect the engagement. The trade union levy is the second compliance risk. The penalty for non-payment is 18 to 20% of the unpaid amount (capped at a statutory ceiling), plus retrospective payment of the levy itself. The Vietnam General Confederation of Labour audits actively and DOLISA enforces, particularly against foreign-invested employers. The third risk is the foreign worker permit gate. Decree 219/2025 tightened the recruitment-portal attestation: foreign hire job postings now require at least 30 days of advertisement on the centralised portal before the work permit application can be filed. Provincial DOLISA offices have rejected applications where the portal posting was missing or too recent. The work permit (RPTKA) and DKP-TKA foreign worker contribution (USD 100 a month) operate under the Decree 152/2020 framework, as superseded by Decree 70/2023 and now Decree 219/2025.Whichapp editorial view
If a provider says the trade union levy is "handled elsewhere" or "blended into BHXH", treat that as a warning sign during procurement, not a feature. The 2% line is owed under Article 26 of the Trade Union Law 2012 regardless of grassroots union status, and a provider that cannot break it out separately on the cost quote is either under-remitting (creating a BHXH audit risk) or hiding it inside a blended employer-cost figure that obscures the real rate from Finance.
Ask for the trade union levy as a separate line on the standard cost-of-employment quote, and walk through the Article 46 severance calculation for a hypothetical 15-year-tenure employee who started in 2007, with the pre-2009 employer-paid portion and the post-2009 BHTN-covered portion modelled separately.
In our view, those two questions get through every legal review and are the single most useful procurement filter on this market.
Which hiring model fits your Vietnam plans?
Here is how we think about choosing between the options, matched to the real questions People Ops leads bring to us.| If you... | Best model | Why | See also |
|---|---|---|---|
| Are hiring 1 to 5 Vietnamese nationals to test the market | EOR | No IRC/ERC liability; payroll live in 5 to 10 days; trade union levy handled automatically | Vietnam EOR providers and pricing |
| Have 6 to 29 hires on a single payroll rhythm | EOR still cheaper, but model the subsidiary cost | Break-even sits between 20 and 50; run the trade-union-broken-out cost stack before locking in | Vietnam EOR providers and pricing |
| Have 30+ hires or are targeting an industrial park tax holiday | Own IRC/ERC subsidiary + global payroll | Year-2 run-rate is lower; corporate tax holidays are accessible; direct DOLISA relationship | Vietnam global payroll providers |
| Need to hire a foreign national in Vietnam | EOR with Decree 219/2025 workflow | The 30-day portal attestation and DOLISA pre-clearance are handled inside the provider | Vietnam EOR providers and pricing |
| Engage a genuinely autonomous specialist with multiple clients | Contractor (ho kinh doanh or sole proprietorship) | The Article 22 subordination test passes only with no exclusivity, scheduling, or tooling-mediated control | Vietnam contractor management guide |
| Operate in a sector with foreign-ownership caps | EOR (sidesteps WTO-commitment limits) | Advertising, logistics, distribution, and e-commerce all face IRC review on the foreign cap | Vietnam EOR providers and pricing |
| Are running a consultant-style senior hire outside BHXH | Convert to employment before an audit | The Law on Social Insurance 2024 substance test caught this structure on 1 July 2025 | Vietnam EOR providers and pricing |
Recommended Vietnamese EOR providers
These five providers run their own Vietnamese entities, each with tax registration you can verify on the National Business Registration Portal. Anything described as "Vietnam coverage via a partner network" should be treated as an extra layer of risk, not as the same thing as the five below.| Provider | Vietnamese entity | Pricing band | Best for | View provider |
|---|---|---|---|---|
| Multiplier | Owned Vietnamese entity | ~USD 400-450/mo | APAC-rooted depth; Region I to IV map and BHXH cap correct by default | View Multiplier → |
| Deel | Owned Vietnamese entity | ~USD 599/mo | Broadest 150+ country coverage with full Vietnamese entity | View Deel → |
| Remote | Owned Vietnamese entity | ~USD 599/mo | Direct compliance chain; Article 46 severance split handled cleanly | View Remote → |
| Velocity Global / Pebl | Owned Vietnamese entity | ~USD 599-699/mo | Mid-market enterprise buyers; Decree 219/2025 workflow refreshed | View Velocity Global → |
| Papaya Global | Owned Vietnamese entity | ~USD 599-799/mo | Enterprise reporting and trade union levy automation | View Papaya → |
Before you send the Vietnamese offer letter
- Confirm the 2% trade union levy appears as a separate line on the cost-of-employment quote.
- Check that the all-in employer cost models the BHXH and BHYT cap at 20 times the reference level (VND 46,800,000 a month).
- Confirm 13th-month bonus treatment in the contract (customary, performance-linked, or excluded).
- Get the legal name and tax registration of the actual employing entity in Vietnam.
- Look that entity up on the National Business Registration Portal before signature.
- Confirm the probation period matches the Article 25 job category, rather than defaulting to the 180-day executive ceiling.
- For foreign hires, confirm the 30-day Decree 219/2025 recruitment-portal attestation workflow.
First 90 days after the Vietnamese hire starts
- Confirm BHXH, BHYT, and BHTN enrolment with the provincial social insurance office.
- Verify that the first trade union levy remittance reaches the higher-level union body (or the grassroots union if one is established).
- Brief the employee on Tet bonus timing and 13th-month cash-flow expectations.
- For foreign hires, file the Temporary Residence Card application within 30 days of the work permit being issued.
- Track contract type and renewal counter to avoid the Article 20 second-renewal-converts-to-indefinite rule.
- Review any contractor-style tools or processes against the Article 22 subordination indicators under the Law on Social Insurance 2024 substance test.
Frequently asked questions about hiring in Vietnam
What is the total employer cost of hiring in Vietnam?
Employer-side statutory cost is 23.5% of contributable salary across four streams: BHXH social insurance at 17.5% (capped at 20 times the reference level, VND 46.8M a month from 1 July 2025), BHYT health insurance at 3% (same cap), BHTN unemployment insurance at 1% (capped at 20 times the regional minimum wage), and a 2% trade union levy under the Trade Union Law 2012. For a Ho Chi Minh City software engineer on VND 50,000,000 a month gross, the monthly employer cost is around VND 11,030,000 (22.1% of gross at this band). Add an effective 8.33% 13th-month accrual where it is contractually expected, plus an EOR fee of USD 400 to 700 per employee per month for the all-in number.
Why does Vietnam have a 2% trade union levy and who pays it?
Under Article 26 of the Trade Union Law 2012 (Law 12/2012/QH13) and Decree 191/2013/ND-CP, every employer in Vietnam owes a 2% trade union fee on the same salary fund used as the BHXH base. The amended Trade Union Law in force from 1 July 2025 keeps this 2% rate in place. The levy applies whether or not the company has a grassroots trade union, whether or not any employee is a union member, and regardless of foreign or domestic ownership. Half the levy flows to the higher-level trade union body if no grassroots union exists; the full 2% flows through the union structure if one is established. There is no parallel in the Philippines, Singapore, or Thailand, which is why APAC cost models imported from those markets understate Vietnamese employer cost by 2 percentage points.
What changed in Vietnam's social insurance rules from 1 July 2025?
The Law on Social Insurance 2024 (Law 41/2024/QH15) expanded compulsory BHXH coverage to part-time workers earning above the regional minimum wage on contracts of one month or more, non-salaried company managers, cooperative executives, and any engagement described under another name where the substance reflects paid work, wages, and employer management for one month or more. The pension qualification threshold dropped from 20 years of contributions to 15 years. Voluntary participants gained four benefit categories (maternity allowance, retirement pension, survivorship allowance, occupational accident insurance). For foreign employers, the pre-2025 consultant or contractor structures used to engage senior Vietnamese hires outside the BHXH net no longer work where the substance of the engagement is employment.
How does the pre-2009 versus post-2009 severance split work in Vietnam?
Severance allowance under Article 46 of the Labour Code 2019 is half a month's wage per year of service, but the "year of service" excludes any period during which the employee was covered by unemployment insurance. Mandatory BHTN began on 1 January 2009. An employee hired after 1 January 2009 typically receives no Article 46 severance; the exit payment flows from BHTN instead. Pre-2009 hires receive Article 46 severance only for the pre-2009 portion. Flat half-month-per-year formulas across the full service period are wrong for both cohorts and create budget surprises in opposite directions.
Can an EOR sponsor a foreign worker permit in Vietnam?
Yes, where the EOR is itself the registered employer of record and the role meets the eligibility criteria under Decree 219/2025/ND-CP (effective August 2025, replacing Decree 152/2020 and Decree 70/2023). The work permit is issued for up to 2 years and is renewable once. The 30-day recruitment-portal attestation under Decree 219/2025 has to be satisfied before the permit application is filed, and provincial DOLISA offices have rejected applications where the portal posting was missing or too recent.
Confirm with the EOR who handles the attestation and how DOLISA pre-clearance fits into the offer timeline. Unlike Singapore's July 2024 MOM restriction, Vietnam does not block EOR-sponsored work permits as a category.
How long does it take to set up a company in Vietnam and what does it cost?
Investment Registration Certificate (IRC) and Enterprise Registration Certificate (ERC) registration takes 3 to 5 months end to end. IRC approval from the provincial Department of Planning and Investment takes 15 to 45 working days from a complete application; ERC follows in 3 to 5 working days; tax code registration with the General Department of Taxation adds another 2 to 3 weeks. Opening a corporate bank account for a foreign-owned entity takes 4 to 8 weeks because of enhanced beneficial-ownership due diligence.
Legal and licensing fees typically run USD 8,000 to 15,000 for a service-sector entity. Ongoing first-year compliance runs USD 20,000 to 35,000 for a small entity, including a retained Vietnamese chief accountant where required under the Accounting Law. Break-even against an EOR sits between 20 and 50 employees depending on provider tier.
What is the BHXH contribution cap and how does it apply?
BHXH and BHYT contributions are capped at 20 times the statutory reference level, currently VND 2,340,000 a month carried forward under the Law on Social Insurance 2024, giving a contribution ceiling of VND 46,800,000 a month from 1 July 2025. Above that ceiling, BHXH and BHYT contributions stop accruing. BHTN sits on a different cap: 20 times the regional minimum wage (Region I cap VND 99,200,000), which is noticeably higher than the BHXH and BHYT cap. Generic global payroll engines without Vietnam localisation get the cap mechanic wrong in the first three months by default, either over-applying it (treating the cap as a flat percentage) or under-applying it (ignoring the cap entirely). Both errors lead to BHXH audit findings.
Can I dismiss a Vietnamese employee for poor performance, and at what cost?
Yes, but the Article 36 statutory ground for underperformance requires documented performance criteria measurable against the contract or company performance regulations registered with DOLISA, repeated written warnings, and 45 days' notice for indefinite-term contracts (30 days for fixed-term contracts of 12 to 36 months, and 3 working days for fixed-term contracts under 12 months). A US-template "performance improvement plan" with a 30-day exit clause is treated as unilateral termination if the documented criteria are missing. The Industrial Court remedy is reinstatement plus back wages from dismissal to reinstatement, plus statutory damages of at least 2 months' salary. Budget at least 6 to 9 months of total compensation plus legal costs for a contested dismissal, and run the process with a Vietnamese labour-law specialist from week one.
What is the second-renewal-converts-to-indefinite contract rule?
Article 20 of the Labour Code 2019 recognises two contract types: fixed-term (up to 36 months) and indefinite-term. A fixed-term contract may be renewed once. The second renewal converts the relationship to an indefinite-term contract by operation of law, regardless of what the third contract document says.
The pattern that catches foreign HR teams: a 24-month contract renewed for another 24 months (a lawful first renewal), then a "third fixed-term contract" issued on expiry. That third contract is indefinite-term in law, so any subsequent termination falls under the Article 36 indefinite-term notice and ground requirements. The operational fix is to track contract renewals on a Vietnam-specific HRIS field, with the second renewal automatically generating an indefinite-term template.
When is the 13th-month bonus enforceable in Vietnam?
Vietnamese law does not require a statutory 13th-month bonus. Article 104 of the Labour Code 2019 defines bonus as employer-determined based on business outcomes and individual performance, with regulations published in consultation with the workplace representative organisation. In practice, the Vietnam Industrial Court and labour arbitration councils have repeatedly held that a bonus consistently paid for three or more years, or referenced in the employment contract as customary, becomes an enforceable entitlement.
Most market offers in Ho Chi Minh City and Hanoi include a 13th-month bonus as standard, paid before Tet. Cost models that exclude the 13th-month understate annual payroll by 8.33%. Models that include it but treat it as discretionary risk an Industrial Court challenge if a year is skipped after a multi-year pattern.
Shortlist these Vietnam-registered EOR providers
Multiplier
APAC-rooted provider with an owned Vietnamese entity. Best value tier; Region I to IV map and BHXH cap correct by default.
Deel
Owned Vietnamese entity, full BHXH/BHYT/BHTN handling, and automated trade union levy remittance.
Remote
Owned Vietnamese entity, flat-fee pricing, and the Article 46 severance split handled cleanly.
Our verdict for People Ops leads
If your Vietnamese headcount is 1 to 29 people, use an EOR and pick one of the five providers above with a verified Vietnamese entity. Confirm that the 2% trade union line appears separately on the cost quote before signing. If you are at 30 or more hires, or chasing industrial park tax incentives, setting up your own IRC/ERC subsidiary usually pays back within 24 months on direct cost alone. If you are leaning towards contractors, run through the Article 22 subordination test against the Law on Social Insurance 2024 substance widening before you sign anything. When DOLISA reviews a 12-month engagement, what matters is how the work is organised, not what the contract calls the relationship. The first practical step is to work out the full cost for the specific role you plan to hire, with the trade union 2% line broken out separately, rather than relying on a generic ASEAN average. That one piece of work removes about 80% of the budget surprises that show up three months later, and it is the number that holds up across every finance and legal review on the way to an offer letter.Running payroll for Vietnam employees? See our guide to payroll in Vietnam.
Running payroll for Vietnam employees? See our guide to payroll in Vietnam.