Employing Foreign Workers in Vietnam
Table of contents Which positions can foreign workers hold in Vietnam?What are the requirements for employing foreign workers in Vietnam?What kind of visas and permits foreign workers need?Employment taxes and tax reporting in VietnamHiring employees in Vietnam using employer of record serviceHow to recruit foreign workers in Vietnam?Most foreign companies registered in Vietnam also want […]
Table of contents
Most foreign companies registered in Vietnam also want to hire foreign nationals. In this article, we will answer the most frequently asked questions about employing foreign workers in Vietnam and explain how to find the best candidates for you.
There are no regulations that specify the ratio of foreign to local employees in companies registered in Vietnam. However, foreigners cannot hold every position.
You can recruit foreign residents only for positions which require specific skills that you cannot find locally. As the need for foreign employees has to be justified, you cannot bring the workforce from abroad for positions that can be filled by locals.
In reality, it is not difficult to prove the need for a skilled foreign employee. For example, having most of your clients from abroad would already be a sufficient reason for hiring an English-speaking foreigner.
As already mentioned, you need a reason for hiring a foreign national instead of a local employee.
Hiring foreign workers is justified if the position has some specific requirements that you cannot find in Vietnam. For example, when you need someone with:
- certain language proficiency
- skills that are not available in Vietnam (for example, in the IT field)
- international experience
The submission of a foreign labor use report and a reason for hiring are enough when you want to hire foreign employees. No extra documents are required. However, note that you need to submit the report 30 days before the expected start of employment.
Emerhub can assist you in preparing the necessary paperwork and legalizing the documents issued abroad. Contact us at [email protected].
Foreign nationals must have a business visa or resident card and a work permit to work legally in Vietnam.
Temporary Resident Card
Up to 12 months
Business partner/ Employer in Vietnam
Possession of a work permit
You don’t have to acquire a work permit if your employment in Vietnam lasts less than three months. In that case, holding a business visa is enough.
However, sponsorship or an invitation letter from a business partner in Vietnam is required. It is a convenient option for staying in Vietnam for a few months. Emerhub can issue the invitation letter.
You have to apply for a work permit if your employment in Vietnam is longer than three months. To get the work permit, you are required to have higher education and sufficient work experience in your field.
Work experience requirement for executives in a managerial position is three years. For non-managerial positions, the Master of Business Administration or some similar document would also be acceptable if the executive does not have enough work experience.
Directors are required to have one year of work experience in their field. Investors, on the other hand, do not need a work permit at all.
Often the problem is that candidates don’t have the documentation to prove their previous work experience. Your former employer must confirm your employment. A suitable document would be an employment record book or an experience letter.
Emerhub can help you draft the experience letter for the previous employer to sign and stamp.
Work permits are issued for 24 months, as stated in the Article 173 of the New Labor Code No.10/2012/QH13. After the expiration of your work permit, you can apply for the renewal.
The acquisition of a work permit allows you to apply for a temporary resident card. You can request for it after receiving the work permit, and it is valid for the same duration as the work permit.
How long does it take to get a work permit in Vietnam?
What documents are required to apply for a work permit?
To apply for a work permit in Vietnam, you need to prepare the following documents:
- Medical examination certificate
- Criminal record certificate for the past six months
- Work experience certificate
- Legalized copy of your passport
Keep in mind that you need to legalize all the required certificates in the country of issuance. Emerhub can assist you in preparing the application and collecting the documents in Vietnam.
Each foreign national you hire needs to be registered immediately. Also, you have to submit labor use reports twice a year and a foreign labor report on a quarterly basis.
For foreigners who are residents in Vietnam, the income tax is progressive and varies from 5% to 35%.
Labor taxes on foreign employees have been lower than on local workers since foreign employees only have only received health insurance. Local employees are also eligible for social and unemployment insurances.
In 2014, however, Vietnam passed the Social Insurance Law according to which employers could also begin making social insurance payments for foreign employees starting from January 2018.
In October 2018, the government released the long-awaited Decree 143/2018/ND-CP which made social insurance payments on foreign employees compulsory starting from 1 December 2018.
Therefore, the current employment taxes on foreign employees are:
Paid by the employer
Deducted from salary
3% Health Insurance
3.5% Social Insurance
2% Trade Union Fee
1.5% Health Insurance
0% Social Insurance
If you would like to know more, read our previous article about the changes in payroll management in Vietnam.
Outsourcing payroll and HR administration
Emerging markets such as Vietnam have myriads of regulations which also tend to change often. To help you focus on your core business while being sure that everything regarding compliance is under control, Emerhub can help you handle the HR administration, including:
- Preparing contracts
- Calculating salaries and making payments
- Tax reporting and compliance
Emerhub also provides an opportunity to employ staff on our payroll. Employer of record (EOR) enables you to hire employees without setting up a company in Vietnam.
It is easier to do than to recruit yourself and no legal presence in Vietnam is required. It also saves you from having to comply with the local employment regulations and from dealing with any employment matters.
The process of company registration in Vietnam usually takes 1-3 months. Using an employer of record is also a convenient way to legally enter the market before you have settled the documents and licenses of your new company.
Once your company is set up, you can either transfer the employees to your payroll or continue using our service.
Getting a driver’s license in Vietnam
Keep in mind that when you or your employees plan on driving a motorbike in Vietnam, they will also need a local driver’s license. Otherwise, private insurances will not cover any potential accidents, and the consequences can be costly.
Driver’s license in Vietnam is available only for residents, and it will be valid until the end of the temporary resident card. Emerhub can assist in obtaining it for you or your employees.
Emerhub has over seven years of experience in the business. We have developed channels through which we have recruited many skilled candidates for positions from entry to senior levels.
We can help you find a qualified workforce or hire specialists who will be on our payroll. You don’t even have to worry about selecting suitable candidates – we will shortlist the applicants for you.
Need assistance in getting a visa or a work permit, or want to find qualified employees in Vietnam? Contact us by filling in the form below, and our consultants will help you with the process.
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