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SALARY PAYMENT IN Vietnamese Dong (VND, ₫)
CONTRACT LANGUAGES Vietnamese / English
PAYROLL TAX 21.50%
PAYROLL CYCLE Monthly
TIME TO HIRE 24 hours
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Vietnam is an appealing option for companies looking to source talent overseas, due to its highly-skilled young workforce, low-cost of living, and large pool of remote workers. Companies looking to hire talent in Vietnam should carefully consider factors such as language capabilities, cultural differences, legal requirements and regional market dynamics before making any hiring decisions.
Here we explain the key things you need to know before hiring employees in Vietnam.
Population 98.17M (55.1M labor force) | Capital City Hanoi | Languages Spoken Vietnamese |
Currency Vietnam đồng (VND) | GDP per capita $3,694 | Ease of Doing Business 70th in the world |
Minimum Wage VND 3.45M-4.96M/month, depending on region | Average Wage 3.45M VND/month | Paid Leave 12 days (14-16 days in some hazardous occupations) |
Despite being one of the countries hit hardest by the COVID-19 pandemic, Vietnam ended 2021 with a GDP growth rate of 2.58%. This marked two consecutive years of growth since the onset of the pandemic in 2020, making it one of few global economies to experience such success. According to the latest figures from the World Bank, growth is expected to more than double in 2022 from 2.6% to 5.5%.
This growth has been actively nurtured by the Vietnamese Government which encourages foreign investment through tax incentives and significant infrastructure projects,
The economic position of Vietnam has also been solidified in recent years through various Free Trade Agreements (FTAs), as well as membership in the Association of Southeast Asian Nations (ASEAN).
Vietnam’s continued positive trajectory means it is one of the fastest growing nations in the region.
When it comes to business regulation, Vietnam’s employment regulations are the most laws for any global business to be aware of. The primary legal framework governing labor relationships in the country is the Labour Code 2019, which came into effect on 1 January 2021.
Under Vietnam’s labor laws, workers have rights to a safe working environment, maximum working hours and a minimum wage. The Labour Code permits three types of labor contracts: indefinite-term, fixed-term (12 to 36 months) and short-term or seasonal contracts (less than 12 months). Note, however, that indefinite-term contracts are not permitted for foreigners in Vietnam.
Collective bargaining agreements are also recognized. As a member of the International Labour Organization (ILO) and the World Trade Organization (WTO), Vietnam is committed to creating and maintaining safe, fair and equitable employment conditions.
Before hiring employees in Vietnam, it is important for employers to be aware of their obligations in order to ensure full compliance.
Business culture in Vietnam has some similarities with business culture in other Asian nations. Important elements include:
Recruiting in Vietnam has much in common with recruitment in other Asian nations — online applications and interviews are becoming the norm. Due to the emphasis placed on personal relationships in Vietnam business relationships, it can be quite common for new employees to be found via third parties and Vietnam recruitment agencies.
There are several job sites that you should consider using in your Vietnam talent search:
While interviewing candidates in Vietnam has much in common with interviewing elsewhere, keep in mind features of Vietnam business culture that willl play into the process:
While interviewing candidates in Vietnam has much in common with interviewing elsewhere, keep in mind features of Vietnam business culture that willl play into the process:
There is no prohibition on doing so in Vietnam.
Many candidates in Vietnam would expect a 10-20 percent increase when starting a new job. However, it depends on the industry. Those in the high-demand IT industry can often request more.
The process of onboarding new employees in Vietnam is similar to elsewhere in southeast Asia, but with a special focus on applicable aspects of Vietnam labor law. Employees need a compliant, written employment contract, and businesses should ensure that all necessary benefits are in place.
Note also, that as of January 1, 2021, Vietnam’s Labor Code was updated to include a new definition of employee: “employee” is a person who works for an employer under an agreement, and is paid, managed, and supervised by the employer.
This means that in Vietnam, someone who might have been classified as a ‘contractor’ when being onboarded, may actually be an employee. You should seek professional advice to ensure that you don’t engage in this employee misclassification.
You can read more about this issue at What is the difference between an employee and an independent contractor?
As a major location for IT professionals, tools that dominate in that industry are also popular in Vietnam.
For communication and project management, Slack, Trello, and Github are popular tools.
In addition to the standard communication tools, such as Skype and Teams that are popular elsewhere, Zalo is the most popular chat tool within the country.
| Date | Holiday name |
|---|---|
| 1 Jan Monday | International New Year’s Day |
| 2 Jan Tuesday | Day off for International New Year’s Day |
| 8 Feb-14 Feb Thursday-Wednesday | Tet Holiday |
| 9 Feb Friday | Vietnamese New Year’s Eve |
| 10 Feb Saturday | Vietnamese New Year |
| 18 Apr Thursday | Hung Kings Festival |
| 30 Apr Tuesday | Liberation Day/Reunification Day |
| 1 May Wednesday | International Labor Day |
| 2 May Thursday | Day off for Liberation Day/Reunification Day |
| 2 Sep Monday | Independence Day |
| 3 Sep Tuesday | Independence Day Holiday |
Currently, the expected salary increase is six percent annually.
Both are options, depending on the needs of your business. Do be aware, however, that Vietnam’s labor law has an expansive definition of ’employee’, that could cover some of the professionals you seek to hire as a contractor.
One option is to hire all workers in Vietnam through a Vietnam Employer of Record solution, where a third party hires all staff and processes payroll and benefits on your behalf.
Yes, it is possible to hire foreigners in Vietnam. The best cities to target for hiring foreigners in Vietnam are Hanoi and Ho Chi Minh city.
The process for opening a Vietnam subsidiary is:
1. Apply for an Investment Registration Certificate from the Ministry of Planning and Investment.
2. Apply for a Business Registration Certificate (BRC), sometimes known as a Enterprise Registration Certificate (ERC).
3. Register for tax.
4. Make your initial Capital contribution. While there is no minimum across, the board, minimums do apply in particular industries. This amount must be submitted within 90 days.
5. Apply for special licenses or permits, if applicable. Some industries requires specific licenses or permits. Check whether that applies in your industry.
There are two key options: Either set up a subsidiary in Vietnam and directly hire employees from that entity. Or, engage a Vietnam EOR solution, like Horizons, where the EOR becomes the legal employer of your Vietnam workforce and takes care of payroll, benefits and compliance on your behalf.
Setting up a subsidiary can make sense if you have broader business operations in Vietnam (e.g., if you want to enter into local business contracts with Vietnamese companies). If your focus is simply hiring staff in Vietnam, an EOR solution usually makes more sense.
Your business can easily hire employees in Vietnam without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.
Holiday Schedule in Vietnam [2024]
