Vietnamese laws on foreign workers in the legal context of asean economy

Vietnamese Laws on Foreign Workers
in the Legal Context of Asean Economy
Doan Thi Phuong Diep
University of Economics and Law, Vietnam National University - HCMC, Vietnam
Duong Kim The Nguyen
University of Economics Ho Chi Minh city, Vietnam

Abstract
According to the imformation from the International Labor Organization (ILO), a total
of 80,000
Vietnamese leave the country for jobs overseas each year. ILO said that approximately 400,000
Vietnamese
workers are now present in over 40 countries and territories worldwide. The annual inflows of
remittances by

labor migrant have reached about US$2 billion in recent years (ILO,2017). This reflects in part
the importance
of labor migration, in particular labor migration among countries in the ASEAN region. Labor
migration poses
legal issues in all countries in both aspects, how to receive migrant workers and how to sent
domestic workers

abroad. The development of a comprehensive legal framework will enable countries to manage
migrant
workers, which in turn can bring economic benefits to the country as well as to the region. On the
other hand,
the improvement of the legal framework of the country will also be the condition to promote the
international

cooperation in this field in the most profitable way.
Within the scope of this article, the authors only mention a legal issue in the current context

in Vietnam,
which is the issue of receiving migrant workers in Vietnam. The article contains the following
(1) situation of
migrant workers in Vietnam, (2) international law on labor migration from the Vietnamese
perspective, and
(3) Vietnamese law on migrant workers.
1. Overview of foreign workers in Vietnam today
In the context of economic integration in the region and the globe, the boundaries between
countries are exclusively legal, and limit the behavior of national rights in domestic and foreign
affairs. These limits are increasingly blurred by the demands for integration, economic
exchanges and cultural exchanges among nations. Labor migration also poses similar issues.
According to the 2015 data in the report sent to the Ministry of Labor – Invalids and Social
Affairs (MOLISA), People Committee of Ho Chi Minh City said that the current foreign workers
who have work permits and cerfify they are not eligible and valid to work permits in the city are
more than 20,300 people. Of those, more than 19,000 were licensed. The country has the
biggest number of Japanese labor working in Ho Chi Minh City, followed by Korea, USA, UK,
China, Taiwan - China. Foreign workers account for the largest number of management
positions (nearly 55%), the remaining are expert workers. There are nearly 5,500 enterprises


and organizations in the city employing foreign workers. As of June 30, 2017, The data from the
Insitute of Labor – Invalids and Social Affairs, Ho Chi Minh City show that there were 22,656
foreign workers working in 6,889 organizations and enterprises in the city (the author
retrieved).

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Meanwhile, according to MOLISA statistics (PV, 2017), as of June 2017, foreigners working in
Vietnam come from 110 countries, of which Chinese nationals make up the highest proportion with

30.9%. The report on the status of foreign workers in Vietnam shows that in just over ten years, the
number of foreign workers in Vietnam has increased from more than 12,600 in 2004 to more than
82,585 in 2016. By the time of June 2017, this figure was over 84,000 people (B.D, 2016). Licensed
workers account for more than 93% of all foreign

workers in Vietnam.
.
Also, according to statistics of Insitute of Labor – Invalids and Social Affairs, Ho Chi Minh
City, 67.38% of foreign laborers are experts, 27.29% of laborers are managers, CEOs
accounted for 0.58% and technical workers accounted for 4.72%.
The above statistics are taken from the practices of foreign workers management in the city. In
the reality, there are still unlicensed foreign workers that cannot be put in the statistics. This
number of laborers come to Vietnam in many different ways but mainly travel, then stay to work in
Vietnam without being licensed.

These figures give us a general view that the number of foreign workers coming to Viet Nam
is increasing steadily over time, especially the labor movement of ASEAN countries. This is
explained by a variety of objective and subjective reasons. However, in our opinion, the
removal of legal barriers to this movement plays a decisive role. The development of common
ASEAN visa or visa exemption among countries in the region is a good example.

2. Internation laws on labor migration having Vietnam’s participation
From an international perspective, Vietnam has ratified important international Conventions
relating to the reception of foreign workers. Specifically ILO Convention No. 122 of July 9, 1964
on Employment Policy Convention and ILO Convention No. 111 of 1958 against discrimination
in employment and occupation (Discrimination).
In particular, the Convention 122 on Employment Policy requires "With the aim of
stimulating economic growth and development, raising living standards, meeting the demand
for human resources and overcoming unemployment and underemployment, each country will
declare and pursue the primary goal, which is an active policy to fully promote freedom of

choice for employment.
The above policy aims to ensure that:

(a) employment for people having jobs or looking for jobs;
(b) the selected jobs should be most effective if possible;
(c) have the freedom of choice of employment and the fullest opportunity for each employee
to qualify and use his or her skills and competences in a job that is appropriate to him or her,
regardless of race, color, sex, religion, political perspectives, national extraction or social origin
"(Article 1 of Convention 122).
Convention No. 111 of 1958 (Vietnam has ratified), which states that “Each Member for
which this
Convention is in force undertakes to declare and pursue a national policy designed to promote,
by methods appropriate to national conditions and practice, equality of opportunity and
treatment in respect of employment and occupation, with a view to eliminating any
discrimination in respect thereof” (Article 2 of the 111th Convention)
As a member country of APEC (Asia-Pacific Economic Cooperation), Vietnam participates in the
activities of this community. One of the vital activities of APEC is human resource development. This
activity aims to help countries develop human resources for economic development. This is a crucial
activity in the common operational goals noted by APEC. APEC agreed in an effort to build a
dynamic and harmonious Asia-Pacific community by promoting trade and freedom in investment;
openly promoting regional economic integration, encouraging economic and technical cooperation,
strengthening human security, and creating a favorable and


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sustainable business environment. APEC’s initiatives turn policy objectives into concrete results
and specific agreements into tangible benefits.
In addition to participating in international conventions on labor, participating as a member

country of the APEC community, Vietnam also signed a series of other trade agreements. Doan
Xuan Truong (2017), showed that within the Asian area, “Labor issues are increasingly being
considered in trading policies, and bilateral and regional investment. This trend is evident in
Free Trade Agreements (FTAs), which include labor clauses”. One of the important agreements
is the ASEAN-Japan Comprehensive Partnership Agreement (AJCEP) in 2008, although this
agreement is prone to economic cooperation and tariffs, yet one of the key objectives in
economic cooperation of the agreement is the development of resources. The resource
development in this shared playground will also create a favorable environment for labor
mobility among member countries.
The above are just some of the international and regional cooperation agreements that
Vietnam participates in. These agreements are more or less related to labor issues and are the
basis for the fact that Vietnam has been prepared to "open" its doors to receive labor force
from other countries or vice versa. This matter also raises questions, what is the preparation
for the legal aspects from the Vietnamese side in the implementation of these international
commitments, particularly the activities of receiving and managing foreign labor? And how do
we balance the national interests in domestic labor protection with the responsibility and other
benefits of receiving international workers to come to work in Vietnam? This question will be
presented in part (3) of this article.
3. Current Vietnamese laws on foreign workers
After the August Revolution in 1945, Vietnam has changed the basic regulations of labor
twice. Firstly, with the introduction of the Labor Code 1994, this law was replaced by the
second law promulgated in 2012 with many changes in general but not much change in
management of foreign workers. There may be three following basic issues:
3.1. Recruitment of foreign workers
Recruitment rights. Recruitment of foreign workers is stipulated at the same time as the
current two documents, including the Labor Code and the Decree No. 11 / CP (2016).
Accordingly, the Labor Code recognizes the labor recruitment as a fundamental right of
employers (No.1a, Article 6, Labor Code). Besides, Decree 11 / CP clearly stipulates the right to
recruit foreign employees, including types of enterprises, representative offices, branches of
enterprises, agencies and organizations licensed by the competent authority, state bodies,

political organizations, socio-political organizations, socio-political-professional organizations,
social organizations, socio-professional organizations, foreign non-governmental organizations,
international organizations in Vietnam. In accordance with these regulations, the laws allow the
broad scope of foreign worker recruitment, including all organizations and enterprises.
However, individuals who wish to recruit foreign workers must be individuals permitted to do
business.
One point worth noting is that even though the Vietnamese labor laws have not been
mentioned, the Laws on cadres and civil servants do not permit the recruitment of foreign
employees to work as civil servants or officials at state organizations. However, Vietnamese
state organizations can do recruitment by signing labor contracts with foreign workers.
Process of recruiting foreign workers. One of the contents of the state management of
foreign workers, which has been developed to enhance the effectiveness of management, is to
establish a management process for the recruitment and employment of foreign workers in
Vietnam. Regarding the recruitment process, it is clearly seen that the law is strictly regulated
through the following steps:

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- The first step: apply for permission for recruitment. According to the provisions in Article 4,
Clause 1 of Decree No.11 / CP of 2006, "the employers have responsibilities to determine the
demands for employing foreign laborers for each job position that is not yet fulfilled by the
Vietnamese laborers, and report to the Chairman of the People's Committee of the province or
city directly under the Central Government
(abbreviated as provincial People's Committee) where the foreign workers intend to work”.
Basing on the report explaining and proposing the employment of foreign laborers, the
Chairman of the provincial People's Committee shall offer written approvals to the employers
on the employment of foreign laborers for each position".
To foreign contractors winning works in Vietnam, if they wish to employ foreign laborers,
"the contractors must declare the number, qualifications and professional capability and

experience of the foreign workers to conduct the bidding package in Vietnam, and propose to
recruit Vietnamese laborers to the tentative positions of the foreign workers (having the
certification of the employer) and the Chairman of the People's Committee of the province
where the contractors performs the bidding package".
"Chairman of People's Committee shall direct local institutions and organizations to
introduce and supply Vietnamese laborers to contractors. Within two months from the date of
receiving the proposal for recruitment of 500 or more Vietnamese laborers, and one month
from the date of receiving the proposal for recruitment of less than 500 Vietnamese laborers, if
not introducing or supplying the Vietnamese laborers to contractors, Chairman of People's
Committee shall consider and decide on the contractors' recruitment of foreign laborers to work
in the positions that cannot be filled up by Vietnamese laborers.
3. Investors shall have to supervise and request contractors to strictly comply with the
contents already declared on the employment of Vietnamese and foreign laborers; to guide,
urge and inspect contractors in implementing the regulations on recruitment and employment
of foreign laborers working for contractors according to the provisions of laws; to monitor and
manage foreign employees in fulfilling the provisions of Vietnamese laws; to quarterly report to
the Insitute of Labor – Invalids and Social Affairs on the status of recruitment, employment and
management of foreign laborers of contractors according to the regulations of the Ministry of
Labor, Invalids and Social Affairs”.
In short, by the end of the first step, enterprises will be entitled to recruit workers on the
basis of the permission of Chairman of the provincial People's Committee for foreign workers.
This permission is expressed through the decision or approval of the employment of foreign
workers. This approval must be granted within 15 days from the date of receiving the report
explaining the employers’ needs for foreign employment.
- The second step: recruitment of foreign workers. After the approval of the President of the
provincial People's Committee on the recruitment of foreign employees, enterprises should
carry out the procedures for notification of recruitment and search for foreign laborers.
- The third step: applying for a work permit. After having been approved for recruitment of
foreign workers and also found suitable workers, enterprises shall carry out the procedures for
applying for work permits. This procedure is detailed in Section 3.2 below.

- The fourth step: sign the labor contract. On the basis of the granted work permit,
enterprises shall proceed a formal labor contract with the foreign worker. Then, they will come
to Vietnam to work.
- The above is the whole process involving in the recruitment of foreign workers. It can be
seen that the provisions of Decree No. 11 / CP (2016) and Circular No. 40 / TT-BLDTBXH
relatively cover all steps in the process of recruiting foreign workers. This process allows
effective management of foreign workers working locally as well as fluctuations that may be
related to the number of foreign workers.


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3.2. Issuance of work permits to foreign laborers to work in Vietnam
Issuance of work permits is a vital part of controlling labor migration to Vietnam. In that
sense, the issuance of work permits is today considered as a step in the process of recruiting
foreign workers to work in Viet Nam, and it is also considered as a procedure to check working
conditions for foreign workers in Vietnam. Vietnamese laws currently does not set out
procedures for foreign workers moving within ASEAN and beyond ASEAN. This means that all
non-Vietnamese workers are considered as foreign workers, and if they want to come to
Vietnam to work, they need to meet the conditions required, particularly obtaining the work
permits.
Article 169 of the Labor Code 2012 of Vietnam stipulates that "Laborers who are foreign
citizens working in Vietnam must satisfy the following conditions:
Having full civil act capacity;
b) Having professional qualifications, skills and health tailored to work requirements;

c) They are not offenders or examined for penal liability according to the provisions of
Vietnamese laws and foreign laws;

d) Having work permits granted by authorised Vietnamese state insitutions, except cases
prescribed in
Article 172 of this Code”.
Meanwhile, according to Article 9 of Decree 11/CP, foreign workers need to meet certain
requirements to obtain the work permits, as follows:
- Having full civil act capacity as prescribed by laws.
- Having good health in accordance with work requirements.
- Be managers, executive directors, experts or technical workers.
- Not being a criminal offender or being prosecuted for criminal liability in accordance with
the provisions of Vietnamese laws and foreign laws.
- Having written official approvals offered by authorised state institutions on the
employment of foreign workers.
These conditions are also the types of documents that employers must prepare in the
applications for work permits. These conditions indirectly show that Vietnam currently only accepts
two groups of foreign workers, including the first group of managers or executive directors, the
second group of experts or technical workers

(Experts are defined as “foreign workers belonging to one of the following cases:

a) Having a written certification of being an expert of an institution, organization, enterprise
in a foreign country;

b) Having a university degree or higher or equivalent and having at least 03 years of working
experience in a profession trained for the positions that the foreign workers intend to work in
Vietnam; for special cases, the Prime Minister shall consider and decide.
Technical workers are "those who have been trained in technical professions or other related
majors for at least one year and have worked for that major at least three years). These
regulations mean that unskilled workers from abroad are unable to work in Vietnam. In our
views, this determination is a way of limiting foreign workers to work in Vietnam, yet, this
restriction is still complied with the international conventions that Vietnam participates in. In

particular, Article 52 (2) of the 1990 International Covention on the Protection of the Rights of
Migrant Workers and their Families provides: "For migrant workers, the country of employment
may:
a. Restrict access to certain types of jobs, occupations or activities if such restrictions are
needed in the interests of the nation and are regulated by national laws.
b. Restrict the freedom to choose paid jobs in accordance with the laws of that country for
the recognition of professional qualifications issued abroad. However, the relating member
countries shall make efforts to recognise these qualifications”.

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Accordingly, the provisions of Vietnamese laws contain restrictions related to the reception
of foreign workers to work in Vietnam. Nevertheless, the restriction is defined as "necessary for
the benefit and national laws and regulated by the countries. " It can therefore be affirmed that
the provisions of Vietnamese laws in this area are absolutely complied with the 1990
International Convention.
The work permits in Vietnam are issued according to the tentative working time of foreign
workers in Vietnam, yet, the maximum duration of the permits is not over 2 years and may be
extended or reissued. Foreign workers who are required to have work permits to work in
Vietnam, but if not having these, they will be deported (Article 171 (2) of the 2012 Labor Code).
(According to real statistics from Ho Chi Minh City and the source of the author, there are no
cases of foreign workers deported because of lack of work permits)
Cases of not requiring work permits. Besides the requirements for the issuance of work
permits as a condition for accepting foreign workers to work in Vietnam, the laws currently
provides the possibilities for foreign workers working in Vietnam without work permits.
Specifically, the cases are specified in Article 172 of the Labor Code 2012:
- Being a capital-contributing member or owner of a limited liability company

- Being a member of the Directorate Board of a joint stock company

- Being a head of a representative office or project of an international organization or a
non-profit organization in Vietnam.
- Coming to Vietnam for a period of less than 3 months to sell services.

- Coming to Vietnam for a period of less than 3 months to handle complicated technical
situations that affect or likely affect production and business that Vietnamese specialists and
foreign experts in Vietnam can not solve them.
- Being a foreign lawyer licensed to practice laws in Vietnam in accordance with the
Lawyer Laws.

- According to the provisions of treaties to which the Socialist Republic of Vietnam is a
member.

- Being a student studying in Vietnam and working in Vietnam, but the employer must
deliver notice with 7 days in advance to the provincial-level state management agency being in
charge of labor.
Decree 11 / CP adds a number of jobs that do not require work permits, such as:

b) Foreign workers who are internally transferred within an enterprise operating in the 11
service sectors in the list of Viet Nam’s commitments on services to the World Trade
Organization, including: business, communication, construction, distribution, education ,
environment, finance, healthcare, tourism, cultural entertainment and transport;

c) Foreign workers entering Viet Nam to provide advisory services and technical expertise or
perform other tasks serving research, construction, appraisal, monitoring and evaluation,
management and implementation of programs/projects funded with official development
assistance (ODA) as specified and agreed in international agreements on ODA between
competent authorities of Viet Nam and other countries;

d) Foreign workers who are issued with a license for the practice of journalism in Viet Nam by

the Ministry of Foreign Affairs in accordance with the laws;
e) Foreign workers who are teachers of foreign organizations that are sent to Viet Nam by
such organizations to teach and research in international schools under the management of
foreign diplomatic missions or international organizations in Viet Nam or permitted by the
Ministry of Education and Training to teach and research in Viet Nam’s education and training
institutions;
ad) Volunteers certified by foreign diplomatic missions or international organizations in Viet
Nam;

e) Foreign workers coming to Viet Nam to work as experts, managers, executive directors or
technical employees with a period of less than 30 days and no more than 90 cumulative days
in 01 years;

g) Foreign workers entering Viet Nam to implement international agreements to which
central and local state agencies are signatories as prescribed by the law;


h) Students studying in foreign schools and institutions having agreements on internship in
agencies, organizations and enterprises in Viet Nam;

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i) Family members of diplomatic agents of foreign diplomatic missions in Viet Nam permitted
for working by the Ministry of Foreign Affairs, except where international treaties to which the
Socialist Republic of Viet Nam is a signatory that contains provisions different from this;
k) Foreign workers who have official passports to work for state agencies, social
organizations and socio-political organizations;
l) Other cases decided by the Prime Minister at the proposal of the Ministry of Labor Invalids and Social Affairs.
It can be seen that the addition of the list of non-licensing activities from 2016 is an

important step for Vietnam in implementing its international commitments for a free and
progressive region where foreigners can come to work in effective protection and have full of
rights as a citizen of that country. Expanding the list without licensing is a visible move in
which good will and the real need to expand country relations in the field of labor, as well as
the spirit that Vietnam is already ready for an open labor market with competitive strength
prepared.
It should be noted that, even though there are a number of occupations that foreign workers
can work in Vietnam without a work permit. However, in order to perform well the management
functions, with this group of workers, Decree 11 / CP stipulates in Article 8 that for this labor
user, the employer should carry out the procedure of "certifying foreign workers that are not
licensed". This certification is also conducted by the Department of Labor, Invalids and Social
Affairs where the enterprise located.
3.3. Rights and obligations of foreign workers working in Vietnam
Clause 2 of Article 169 of the Labor Code 2012 stipulates Laborers who are foreign citizens
working in Vietnam must obey the Vietnamese labor legislation and international treaties to which
Vietnam is a member, having different regulations protected by Vietnamese laws. Therefore,
basically, the rights and obligations of foreign workers working in Vietnam are similar to Vietnamese
workers working in Vietnam as defined in Article 5 of the 2012 Labor Code. Many of the rights of
foreign workers are even higher than the rights of Vietnamese workers, such as the right to be paid,
the current practice of the same enterprise, even the same positions and the workload, the salary of
a foreigner is usually higher than that of Vietnamese.

For the first time, Social Insurance Law 2014 allows foreign employees to participate in
social insurance in Vietnam: "Employees who are foreign citizens working in Vietnam have work
permits or practice certificate or a licensed working certificate granted by authorized
Vietnamese agencies may participate in compulsory social insurance according to the
Government's regulations" (Article 2, Clause 2 of the Laws on Social Insurance, 2014). The
recognition of this right has not been effective yet (The provisions on the right to social
insurance of foreign workers in Vietnam will come into effect from 1/1/2018), but this is a new
point in asserting that the rights of foreign workers and Vietnamese citizens to work is

absolutely equal (In fact, according to the assessment of labor experts, foreign workers working
in Vietnam will not be "very happy" with this right because the current social insurance regimes
in Vietnam is low and the retirement regime is only applied for a long term when workers reside
for a long time in Vietnam. Due to these inconveniences, in the reality, the social insurance is
not the right that foreign workers care about.), also relating to the right to participate in social
insurance of foreign workers.
One of the most important rights of foreign workers working in Vietnam is the right to work,
free choice of employment, occupation, vocational training, professional development and nondiscrimination. (Article 5, Clause 1, point a of the 2012 Labor Code). This right is recognized for
all workers, yet, there is still a limit on the freedom of choice for foreign workers. In particular,
foreign workers cannot become cadres, civil servants or officials as Vietnamese citizens. This
limitation is also explained by the exceptions recognized in the 1990 Convention on the Rights
of Migrant Workers and Their Families.


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In brief, from all of the regulations on the issue of recruitment, issuance of work permits, the
reception of foreign workers to work in Vietnam, there may be two requirements that seem to
contradict each other. The first is to welcome foreign workers in a context of regional and
global economic integration, in the urge to establish international trade relations. The second is
to protect the domestic labor market by limiting the competition between foreign workers and
Vietnamese workers, reducing the unemployment rate. The Vietnamese Government has
chosen to compromise both of these requirements by responding to the first requirement,
opening up and receiving foreign workers in the spirit of respect for international commitments.
However, some exceptions are still kept to protect the domestic labor market.
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ILO (2017), Labour migration in Viet Nam , last visit on 4
June 2018. PV(2017, June 20), More than 30% of foreign workers in Vietnam are Chinese. Retrieved from
/>

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respect of foreign workers in Vietnam
Circular No. 40/TT-BLDTBXH guidance on implementation of a number of articles of decree no.11/2016/ND-CP dated
February 03, 2016 detailing a number of articles of the Labor Code in respect of foreign workers in Vietnam

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