On November 20, with an approval rating of 90.06% of participated delegates, the National Assembly passed the Labor Code 2019 (‘The revised Labor Code’) with various amendments. Some updated points are as follows:
1. Provisions on labor contract (Article 20)
The revised Labor Code stipulates that a labor contract must be concluded in one of two categories: Indefinite-term labor contract or Definite-term labor contract.
Specifically:
– Indefinite-term labor contract is a contract in which the two parties do not specify the term and the time of termination of the contract’s validity.
– Definite-term labor contract is a contract in which the two parties determine the term and the time of termination of the contract but not exceeding 36 months.
The type of Seasonal labor contract is no longer prescribed in this revised Labor Code.
In addition, regarding form of labor contract, besides the written form as stipulated in the Labor Code 2012, the Revised Labor Code supplements cases where labor contract can be concluded via electronic means in the form of data messages under the provisions on electronic transactions are valid as written labor contract.
2. Provisions on probation period for management position (Article 25)
The addition of probation period for management position is a new point of the Revised Labor Code. In details, the probation period for management position which is prescribed by Enterprise Law cannot exceed 180 days. Meanwhile, the former Labor Code has no provisions regarding this.
3. Provisions on employees’s right on unilateral termination of labor contract (Article 35)
According to the Labor Code 2012, employees have the right to unilaterally terminate labor contract in one of the cases prescribed in the Code and must notify employers from 03 to 45 days in advance according to the type of Contract. However, under the Revised Labor Code 2019, employees have the right to unilaterally terminate the labor contract without reason but must notify employers in accordance with the prescribed time limit. The Revised Labor Code also stipulates 7 cases in which employee has the right to unilaterally terminate labor contract without prior notice such as: Not be assigned to the job, the working place or the working conditions are not guaranteed as agreed; Not being paid fully or on time; The employer provides dishonest information and a number of other cases as prescribed.
4. Provisions on employer’s right on unilateral termination of labor contract
The Revised Labor Code supplements cases where employer has the right to unilaterally terminate labor contract compared to the former Code such as:
– Employees of full retirement age in accordance with the law
– Employee quit his job by himself without a plausible reason for 05 or more consecutive working days (according to the former Code this is one of the cases where an employee is entitled to dismiss)
– Empoyee provides dishonest information
5. Regulations on overtime (Article 107):
Employers may require employees to work overtime if following conditions are fully met:
– Obtaining the employee’s consent; Ensuring the overtime of employees does not exceed 50% of normal working hours in 01 day; in case of applying the regulation of normal working hours per week, the total number of normal working hours and overtime hours shall not exceed 12 hours in a day; no more than 40 hours in 1 month; (The Labor Code 2012 stipulated no more than 30 hours in a month)
– Ensuring the number of overtime hours of employees does not exceed 200 hours in a year, except for the case specified in Clause 3 of this Article.
– An employer may require an employee to work overtime for no more than 300 hours in a year (the Draft Labor Code in which overtime increases to 400 hours per year has been disapproved) in the following industries, jobs, or in the following cases:
+ Producing, processing and exporting textile, garment, leather, shoes, electric and electronic products, processing agricultural, forestry, salt-producing and aquatic products;
+ Producing, supplying electricity, telecommunications, oil refining; water supply and drainage;
+ In case of handling jobs requiring employees with high professional and technical qualifications which labor market can not provide sufficient and timely;
+ In case of urgent work that cannot be delayed, due to the seasonality and timing of raw materials, products or to solve jobs arising due to unpredictable objective factors result from weather consequences, natural disasters, enemy sabotage, fire, lack of electricity, lack of raw materials and technical problems of production lines;
+ Other cases prescribed by the Government.
6. Increasing age of retirement (Article 169):
According to the Labor Code 2012, “An employee who meets the conditions on the period of payment of social insurance stipulated by the law on social insurance is entitled to a pension when reaching full 60 years of age, for males, or full 55 years of age, for females.”. The revised Labor Code 2019 has increased the age of retirement according to the following schedule: full 62 years of age for males by 2028 and full 60 years of age for females by 2035. And since 2021, the retirement age of employees under normal working conditions is full 60 years 3 months for males and 55 years 4 months for females; Thereafter, 3 months for male employees and 4 months for female employees will be increased each year.
Workers suffer from reduced working capacity; doing extremely heavy, toxic and dangerous jobs; doing heavy, hazardous and dangerous jobs; Working in regions with exceptionally difficult socio-economic conditions may retire at a younger age but not exceeding 05 years as prescribed in Clause 2 of this Article at the time of retirement, unless otherwise provided by Law.
Employees with high professional and technical qualifications and in some special cases may retire at a higher age but not later than 5 years from the time of retirement, unless otherwise provided by Law.
7. Adjustment on public holidays
National Day holiday is increased to 02 days (September 2 and 01 day preceding or afterward).
The content of compensatory leave in case public holiday and New Year holiday coincide with weekends is abolished.
8. Regulations on labor discipline
The Revised Labor Code also provides more specific provisions on the application of disciplinary measures of dismissal, such as supplementing the case of sexual harassment at the workplace as prescribed in labor regulation, clearly guides more about cases where an employee quits his job by himself in 05 consecutivedays within 30 days or 20 consecutive days within a period of 365 days from the first day of voluntarily quitting his job without plausible reason.
9. Adjustment on the term of work permit for foreign worker
The Revised Labor Code supplemented limitation on the number and time of work permit extension. Accordingly, the maximum term of work permit is 02 years. In case of extension, it can be extended only once for a maximum term of 02 years.
This Revised Labor Code includes 17 chapters and 220 articles and comes into force from January 1, 2021.
