1.Introduction
Vietnam, a country with rich culture and scenic beauty, has become an increasingly attractive destination for overseas employers seeking investment and business expansion. However, as an employer, understanding Vietnam's statutory leave system is crucial to ensure the protection of employees' rights.
According to Vietnamese labor law, employees are entitled to 12 days of paid annual leave after working for 12months. After 5 years of service, the annual leave increases to 14 days. Additionally, for every 3 years of service, employees gain an extra 2 days of annual leave, capped at 30 days. These annual leave days can be accumulated based on individual circumstances.
In addition to paid annual leave, employees have the right to other types of leave, such as marriage leave (3 days),bereavement leave (3 days), maternity leave (4 months), and paternity leave (5days), as per Vietnamese labor law.
2.Benefits in Vietnam
Apart from the leave system, Vietnamese labor law prescribes a range of benefits to ensure the basic rights of employees are protected.
Firstly, there's the social insurance system. Employers are required to contribute to social insurance for employees, covering pension, medical care, unemployment, occupational accident, and maternity insurance. Employers contribute a certain percentage of the employee's salary, with the employee's portion deducted from their wages.
Secondly, there are regulations regarding public holidays and overtime pay. According to Vietnamese labor law, employees are entitled to one day off per week, typically on Sundays. If employees work on public holidays, employers are required to pay overtime and provide compensatory time off.
Furthermore, Vietnamese labor law specifies additional benefits such as year-end bonuses, severance pay, vocational training, and occupational safety. These benefits can be negotiated between employers and employees.
3. Considerations for Overseas Employers
As overseas employers, understanding the leave and benefits system in Vietnam is crucial. Here are some recommendations for overseas employers:
3.1. Understand Vietnamese Labor Law: Before hiring Vietnamese employees, it is essential to understand Vietnamese labor law. This helps in understanding employee rights and benefits and ensures compliance with relevant laws and regulations.
3.2. Establish Reasonable Leave Policies: Based on the leave system prescribed by Vietnamese labor law, establishing company leave policies is crucial. These policies should consider individual employee circumstances and company needs while ensuring fairness and transparency.
3.3. Compliance with Social Insurance: Employers need to contribute to social insurance according to the percentages specified in Vietnamese labor law. Ensuring timely payment and deducting the employee's portion from wages is essential.
3.4. Provide Reasonable Benefits: In addition to statutory benefits, consider providing extra benefits such as year-end bonuses, training opportunities, and career development. This enhances employee satisfaction and loyalty.
4.Conclusion
Understanding the leave and benefits systemin Vietnam is vital for overseas employers. By adhering to relevant laws and providing reasonable benefits, employers can attract and retain exceptional employees, creating better opportunities for business development. This blog aims to assist overseas employers considering business expansion in Vietnam.
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