For EU and foreign companies hiring in Vietnam, the main question is not only whether an EOR can hire the employee. The real question is: which compliance obligations does your Employer of Record own, and which inputs still come from your team?
Employer of Record compliance Vietnam means the EOR acts as the legal employer in Vietnam. Your company directs the day-to-day work. The EOR handles the Vietnamese employment layer: contracts, registration, statutory reporting, work permits, and exit documentation.
For a Dutch HR Director, this matters because Vietnamese employment law does not mirror Dutch practice. Contract types, probation periods, work permit rules, and termination procedures follow local law. A clear employer of record in Vietnam setup gives your team a legal employer on the ground without turning your HR team into a Vietnam labor law department.
TL;DR
- In Vietnam, your EOR handles employment contracts, SHUI registration, monthly statutory reporting, work permit sponsorship for foreign nationals, and termination documentation.
- Your company still provides the inputs: role, salary, start date, work location, employee documents, salary changes, and termination decisions.
- A strong EOR setup makes ownership clear before the employee starts: the EOR owns legal execution; your team owns timely and accurate information.
Labor Code 2019: the legal framework your EOR works within
Vietnamese employment is governed by the Labor Code 2019. In an EOR arrangement, the EOR works inside this framework because it is the legal employer on Vietnamese records.
This is where many EU companies need the first adjustment. Your team may be used to Dutch or EU employment norms, but your Vietnam hire sits under Vietnamese rules for employment contracts, probation, termination grounds, notice, severance, and statutory registration. The EOR closes that gap.
The practical split is simple: you direct the employee’s work, priorities, and performance expectations. The EOR makes sure the employment relationship is documented and operated under Vietnamese law. For companies still comparing entry models, read on EOR vs entity setup Vietnam.
Employment contracts: bilingual, in writing, legally compliant
A Vietnam EOR contract is not a side document. It is the employment foundation. The EOR drafts and signs the labor contract as the legal employer. Your company approves the role, salary, work location, start date, and commercial terms through the EOR service agreement.
Contract types under Labor Code 2019
Under Labor Code 2019 Article 20, employment contracts are structured as indefinite-term contracts or fixed-term contracts. A fixed-term employment contract can run for up to 36 months. If the employee keeps working after a second fixed-term contract expires, the next contract generally becomes indefinite-term, except for specific statutory cases.
For most EU companies making a first or second Vietnam hire, the EOR will usually recommend a fixed-term contract aligned to the initial project, budget, or market-entry phase. If the role becomes permanent, the EOR should advise when the contract needs to move to an indefinite-term structure.
What must be in a Vietnamese labor contract
Labor Code 2019 Article 21 sets required contract contents, including employer information, employee information, job and workplace, contract duration, salary, working hours, rest periods, and insurance-related obligations.
Your EOR turns those requirements into a contract the employee can sign. Your team does not need to draft Vietnamese labor wording. It must provide the correct inputs: role title, job description, salary, work location, contract duration, start date, and any agreed allowances.
This is also where the EOR should reflect statutory entitlements without turning the contract into a benefits guide. The detailed benefits explanation belongs in statutory benefits provided through EOR.
Bilingual contracts and who signs what
For foreign companies, a bilingual Vietnamese-English contract is the safest operating standard. The Vietnamese version gives the EOR and employee a local-law employment record. The English version gives your EU team a working document they can review.
The EOR signs the labor contract as the legal employer. The employee signs as the employee. Your company is not the labor-contract counterparty; it signs a commercial service agreement with the EOR.
That separation is the point of the model. You approve the commercial and operational terms. The EOR executes the labor contract.
Probation periods: what your EOR includes
Probation in Vietnam must match the role. Labor Code 2019 Article 25 allows one probation period for a job, with maximum periods of 180 days for enterprise executive roles, 60 days for roles requiring a junior college degree or above, 30 days for technical or skilled roles requiring vocational or professional secondary qualifications, and 6 working days for other jobs.
During probation, either party can terminate the probation arrangement without prior notice or compensation obligation. Your EOR should select the probation period based on the role and seniority. Your team provides the role scope; the EOR applies the legal limit.
SHUI registration and ongoing reporting obligations
SHUI refers to Vietnam’s statutory social, health, and unemployment insurance system. This article does not cover SHUI contribution rates or payroll calculations. Those belong in how EOR handles payroll and SHUI.
Here, the compliance point is registration and reporting.
Under Vietnam’s Social Insurance Law 2024, the employer must prepare and submit the compulsory social insurance registration application within 30 days from the day the employee becomes subject to compulsory social insurance participation. The social security authority then has 5 working days to decide whether to approve or reject a satisfactory application.
In an EOR setup, the EOR handles the registration with Vietnam Social Security. Your team does not file directly with the authority. Your team must give the EOR the employee’s personal details, identification documents, contract start date, salary information, and any salary or exit changes before the payroll cut-off.
Work permits for foreign nationals: what your EOR sponsors
Most EOR hires in Vietnam are Vietnamese nationals. The work permit issue appears when your company sends a Dutch, EU, or other foreign national to work in Vietnam.
In that case, the EOR’s role becomes more than payroll. The EOR sponsors the work permit as the legal employer and tracks the application, expiry, and renewal cycle.
When a work permit is required
Foreign nationals working in Vietnam generally need a work permit unless they fall under a statutory exemption. Under Decree 219/2025, work permits and work permit exemption confirmations are issued for a period tied to the relevant employment or assignment document, but not exceeding 2 years.
Your company provides the employee documents and role justification. The EOR prepares and submits the application.
When a work permit is not required: exemptions
Exemptions exist, but they should be checked before relying on them. Decree 219/2025 lists foreign workers exempt from work permit requirements, including cases linked to Article 154 of the Labor Code and owners or capital contributors with a capital contribution value of VND 3 billion or more in a limited liability company.
For most knowledge workers hired for ongoing work, such as developers, analysts, product managers, or country operators, the safer planning assumption is that a work permit will be needed unless counsel or the EOR confirms an exemption.
Documents required and processing timeline
Work permit applications require careful document handling. Decree 219/2025 requires foreign-issued documents used in work permit and exemption applications to be consular legalized unless an exemption applies, then translated into Vietnamese and authenticated according to law.
The official authority timeline is shorter than many companies expect, but only after the file is complete. Decree 219/2025 says the employer submits the application within 60 days and no less than 10 days before the foreign worker’s expected start date. The competent authority then has 10 working days from receipt of a complete application to review and issue the work permit, or 3 working days to respond in writing if refusing the application.
The practical timeline is longer because the employee may need to collect, legalize, translate, and authenticate documents before submission. Your EOR should tell you which documents are blocking submission, not only when the authority clock starts.
Termination compliance: what the EOR handles on exit
Termination is where EOR ownership matters most. Your team may decide that the working relationship should end. The EOR must confirm whether the proposed ground and procedure are lawful before taking action.
This section is a compliance map only. The full procedure should sit in full EOR termination procedure Vietnam
Lawful grounds for termination
Labor Code 2019 Article 36 gives the employer’s grounds for unilateral termination. These include repeated failure to perform work based on established assessment criteria, prolonged sickness or accident after statutory treatment periods, absence from work without acceptable reasons for at least 5 consecutive working days, reaching retirement age unless otherwise agreed, and certain cases involving inaccurate information provided during hiring.
The EOR should not simply execute a termination instruction. It should ask for the ground, check the evidence, confirm the notice period, prepare the documents, and advise if the case does not fit the statutory route.
If termination is handled unlawfully, Article 41 requires the employer to reinstate the employee and pay salary and insurance for the period the employee was not allowed to work, plus at least 2 months’ salary under the employment contract.
Notice periods and severance overview
For employer unilateral termination under Article 36, the minimum notice period is at least 45 days for an indefinite-term contract, at least 30 days for a fixed-term contract of 12 to 36 months, and at least 3 working days for a fixed-term contract under 12 months or certain sickness-related cases.
Severance is separate from notice. Labor Code 2019 Article 46 calculates the eligible working period as the total time the employee actually worked for the employer minus the time covered by unemployment insurance and any period already paid severance or redundancy allowance. The salary base is the average salary of the last 6 months under the employment contract before termination.
Your team provides the termination decision, business ground, final salary approval, and any performance evidence. The EOR checks the legal route, prepares notice, calculates statutory amounts, and completes exit administration.
If contracts, SHUI, work permits, and termination all sit in different systems, your first Vietnam hire becomes harder to manage than it needs to be.
Sunbytes manages EOR compliance for EU and foreign companies hiring in Vietnam: bilingual Labor Code 2019 contracts, SHUI registration, work permit sponsorship, termination documentation, GDPR Article 28 DPA before engagement, and ISO 27001 certified from 2024 to present.
See how Sunbytes manages EOR compliance
Compliance ownership: what the EOR owns vs what you must provide
As the legal employer, the EOR owns every compliance obligation in this article. Your team has one job: provide accurate information on time.
That is the operating model. The EOR handles legal execution. Your company keeps control of the role, work direction, budget, and business decisions.
| Compliance task | EOR owns | Client must provide |
|---|---|---|
| Employment contract drafting (Vietnamese + EN bilingual) | Drafts, executes, and files | Salary, role title, work location, contract type, start date |
| Contract type selection (definite vs indefinite) | Advises on appropriate type; drafts accordingly | Engagement duration and renewal intent |
| SHUI registration within 30 days of hire | Registers employee with Vietnam Social Insurance | Employee personal details, passport or ID, bank account |
| Monthly SHUI reporting and remittance | Calculates, reports, and remits employer and employee shares | Salary changes or exits by cut-off date |
| Work permit application for foreign nationals | Sponsors and submits application to the competent authority | Passport, criminal check, health certificate, qualifications, legalized and translated where required |
| Work permit renewal tracking | Notifies client before expiry and manages renewal | Updated employee documents |
| Termination procedure | Confirms lawful grounds, issues notice, prepares exit documents | Termination decision and grounds; approval of final salary and severance |
| Severance calculation and payment | Calculates under Labor Code 2019 Article 46; processes payment | Service start date and any salary history adjustments |
| SHUI deregistration on exit within 24 hours | Deregisters employee from VSS under Sunbytes SLA | Confirmed exit date |
| Annual labor report, if required by local authority | Files on behalf of the employment setup where required | Any requested workforce information |
How Sunbytes supports Employer of Record compliance in Vietnam
Every obligation in this article has the same pattern: the EOR owns legal execution, but your team still needs a clear operating rhythm. Contract inputs must arrive before start date. Salary changes must reach payroll before cut-off. Work permit documents must be ready before the authority clock starts. Exit decisions must be checked before notice is issued.
Sunbytes handles that operating rhythm through Accelerate Workforce Solutions. Your Vietnam hire is employed through a compliant EOR structure, supported by bilingual Labor Code 2019 contracts, SHUI registration, work permit sponsorship, and offboarding with SHUI deregistration within 24 hours.
That workforce layer is supported by Sunbytes’ Secure and Transform capabilities. Cybersecurity Solutions protects the employee-data flow behind EOR work: GDPR Article 28 DPA before engagement, ISO 27001 certification from 2024 to present, controlled document handling, and access discipline for payroll and HR records. Digital Transform Solutions supports the workflow behind the service: clear handover points, structured onboarding steps, and communication routines that help EU teams work with Vietnam without losing control of timing.
For Dutch and EU companies, this means the employee can start under the right employment structure, the data is handled with the right controls, and the process has a clear owner from onboarding to exit. You direct the work. Sunbytes handles the employment infrastructure around it.
Talk to the Sunbytes EOR compliance team
FAQs
An EOR in Vietnam handles the legal employment layer: bilingual employment contracts under Labor Code 2019, SHUI registration and statutory reporting, work permit sponsorship for foreign nationals, termination procedure, severance calculation, and exit administration. Your company provides employee information and business instructions. The EOR handles legal execution.
Yes. The EOR is the legal employer in Vietnam, so Vietnamese labor law governs the employment relationship. Your company directs the work, but the EOR manages the employment record, contract, statutory registration, and local compliance process.
Under Labor Code 2019, the EOR uses either a fixed-term contract or an indefinite-term contract. A fixed-term contract can run for up to 36 months, and after two fixed-term contracts, the next contract generally becomes indefinite-term if the employee continues working, except for statutory exceptions.
Generally yes, unless the foreign national qualifies for a statutory exemption. The EOR sponsors the work permit as the legal employer, while your company and the employee provide the documents needed for the file. Decree 219/2025 also confirms that work permits and exemption confirmations are generally limited to the validity of the relevant document and cannot exceed 2 years.
The EOR checks whether the termination ground is lawful, confirms the notice period, prepares the notice and exit documents, calculates statutory amounts where applicable, and completes exit administration. Your company communicates the decision and grounds. The EOR confirms whether the legal route is available before executing.
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