The individual income tax ranges from 5% to 35%. Income tax is calculated according to progressive rates. Multiple additional factors may impact overall rates such as the household status and the number of children.

The employer's cost is 23.5% of the employee's salary.The maximum monthly salary for the calculation of the social insurance, health insurance, and control union fee is VND 36,000,000. 

The maximum monthly salary for the calculation of the unemployment insurance contribution is 20 times the monthly minimum wage of the employee’s region of residence (up to VDN 93,600,000).

• Social Insurance - 17%
• Health Insurance - 3%
• Accident Insurance - 0.5%
• Control Union Fee - 2%
• Unemployment Insurance - 1%

Standard working hours are 8 hours per day, 40 hours per week. The standard workweek is from Monday to Friday.

Overtime payment is mandatory. Hours outside of standard work hours are considered overtime. Employees can work no more than 12 hours a day, including normal and overtime hours. For overtime hours, employees are paid:

• 150% of the hourly rate on weekdays
• 200% of the hourly rate on weekly days off
• 300% of the hourly rate on public holidays

Employees who have contributed to social security for at least 3 months are entitled to 5 days of paid paternity leave. The employee will receive 100% of the salary during this period, and Social Security will be responsible for this pay.

Terminations must respect complex rules and the rules of an employee’s employment country. The off-boarding is always handled by the Employer with the primary stakeholders. It may include ad-hoc fees as well as required or recommended steps on specific termination cases.

Terminations in Vietnam can be complex. There is no at-will termination in Vietnam for employers outside the probation period and termination must be done for just cause.

Compliant terminations include:

• Voluntarily by the employee
• By mutual agreement
• Unilaterally by the employer based on:
  • probation period
  • objective grounds
  • disciplinary dismissal
  • performance due to unsuitability for the job
• By the expiration of the contract

The minimum notice period is 3 days and will be increased according to the type of contract.

• 45 days if the contract is indefinite
• 30 days if the contract is fixed term of 12 - 36 months
• 3 working days if the contact is a fixed term under 12 months

In Vietnam, all employees who have worked for over a year and are terminated are entitled to severance pay, unless they are terminated for:

• Having committed acts of theft, embezzlement, disclosure of technological and business secrets, or other acts causing severe loss to the property and interests of the enterprise.
• Having been transferred to another job as a disciplinary measure, the employee then again commits the same breach of labor discipline when the disciplinary measure is still in effect.

Severance pay is half a month of salary per year of service. There is no law capping the amount of severance that can be paid.

Vietnam celebrates 6 national holidays (11 days total) and some regional holidays based on the location of the employee. National public holidays include:

1. New Year’s Day: 1 day
2. Lunar New Year: 5 days
3. Hung King’s Festival: 1 day
4. Reunification Day: 1 day
5. Labour Day: 1 day
6. Independence Day: 2 days

Contracts can be written in English. They must be in writing and signed by both parties.

A contract must include:

• name
• start date
• length of the employment
• job description
• termination conditions

Probation periods are mandatory. The minimum probation period is 6 days and the maximum probation period is 180 days. Probation periods vary depending on the job type.

*The legal department must usually approve contracts with 180 days of the probation period before the agreement with the employee.