Decree No. 05/2015/ND-CP dated January 12, 2015 of the Government guiding the implementation of a number of the Labor Code’s contents

DECREE

Detailing and guiding a number of provisions of
the Labor Code[1]

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the June 18, 2012 Labor Code;

Based on the National Assembly Standing Committee’s opinions in Document No. 716/UBTVQH13-CVDXH of August 13, 2014, guiding the implementation of a number of articles and clauses of the Labor Code;

At the proposal of the Minister of Labor, War Invalids and Social Affairs,

The Government promulgates the Decree detailing and guiding a number of provisions of the Labor Code.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

This Decree provides rights and responsibilities of employers, employees, organizations representing labor collectives and related agencies, organizations and individuals in the implementation of a number of the Labor Code’s provisions on labor contract, collective bargaining, collective labor agreement, wage, labor discipline, material responsibility, and resolution of labor disputes.

Article 2. Subjects of application

Employees, employers, and other agencies, organizations and individuals directly related to industrial relations prescribed in Article 2 of the Labor Code.

Chapter II

LABOR CONTRACTS

Section I

ENTRY INTO LABOR CONTRACTS

Article 3. Persons entering into a labor contract

1. A person entering into a labor contract on the employer side is:

a/ The at-law representative indicated in the charter of an enterprise or a cooperative;

b/ The head of an agency, unit or organization in accordance with law;

c/ A householder; or

d/ An individual directly employing employees.

In case the person entering into a labor contract on the employer side prescribed at Points a, b and c, Clause 1 of this Article cannot personally enter into the labor contract, he/she may lawfully authorize in writing another person to enter into the labor contract according to the form set by the Ministry of Labor, War Invalids and Social Affairs.

2. A person entering into a labor contract on the employee side is:

a/ An employee who is full 18 years old or older;

b/ An employee who is between full 15 years and under 18 years old and has a written consent of his/her at-law representative;

c/ The at-law representative of an employee who is under 15 years old with his/her consent; or

d/ An employee authorized by a group of employees to enter into the labor contract.

3. A person authorized to enter into a labor contract prescribed in Clauses 1 and 2 of this Article may not authorize another person to enter into the labor contract.

Article 4. Contents of a labor contract

The major contents of a labor contract prescribed in Clause 1, Article 23 of the Labor Code are provided as follows:

1. Name and address of the employer, including the following:

a/ Name of the enterprise, agency, organization, cooperative or household that hires or employs the employee under the labor contract as shown in its enterprise or cooperative registration certificate, investment certificate or establishment decision. In case an individual hires or employs employees, his/her full name as shown in his/her identity card or passport is required;

b/ Address of the enterprise, agency, organization, cooperative, household or individual that hires or employs the employee as shown in its enterprise or cooperative registration certificate, investment certificate or establishment decision in accordance with law;

c/ Full name, date of birth, identity card or passport number, residence address or position in the enterprise, organization, cooperative or household that hires or employs the employee of the person entering into the labor contract on the employer side prescribed in Clause 1, Article 3 of this Article.

2. Identity card number or other lawful documents of the employee, including the following:

a/ Serial number of the employee’s identity card or passport granted by a competent agency;

b/ Number, date and place of issuance of a work permit granted by a competent agency to a foreign employee working in Vietnam;

c/ Written consent to entry into the labor contract of the at-law representative, for an employee who is between full 15 years and under 18 years old;

d/ Full name, date of birth, gender, residence address, identity card or passport number of the at-law representative, for an employee who is under 15 years old;

dd/ Written consent of an employee who is under 15 years old to his/her at-law representative’s entry into the labor contract.

3. Job and workplace, which are provided as follows:

a/ Job: job that the employee must perform;

b/ Workplace of the employee means scope of agreed job and place where the employee performs the job. If the employee works in different places, the main workplace of the employee shall be indicated.

4. Term of the labor contract includes the time of labor contract performance (the number of months or days), the starting or terminating time of labor contract performance (for a definite-term labor contract or a seasonal or work-specific labor contract); and the starting time of labor contract performance (for an indefinite-term labor contract).

5. Wage, wage payment form and deadline, wage allowances and other additional payments, which are provided as follows:

a/ Wage, wage allowances and other additional payments determined under Clause 1, Article 21 of this Decree;

b/ Wage payment forms prescribed in Article 94 of the Labor Code;

c/ Wage payment period as agreed by the two parties under Article 95 of the Labor Code.

6. Regimes for grade and rank promotion and wage raise: Requirements, duration, time and wage level following the rank promotion and wage raise as agreed by the two parties.

7. Working time and rest time, including the following:

a/ Daily or weekly working hours; work shifts; the starting or ending time of a working day, week or shift; the number of working days per week; overtime work and other terms and clauses related to overtime work;

b/ Duration, starting or ending time of a rest in working hours; weekly and annual paid days off, public holidays, leave for personal reasons or unpaid leave.

8. Personal protective equipment for the employee: Number, type, quality and use duration of each type of personal protective equipment as prescribed by the employer.

9. Social insurance, unemployment insurance and health insurance, including the following:

a/ Percentage of the monthly wage to be paid as social insurance, unemployment insurance and health insurance premiums by the employer and the employee in accordance with the laws on social insurance, unemployment insurance and health insurance;

b/ Method and time of payment of social insurance, unemployment insurance and health insurance premiums by the employer and the employee.

10. Training, retraining and occupational skill improvement for the employee in the course of labor contract performance: Rights and obligations of the employer and the employee to ensure time and fund for training, retraining and occupational skill improvement.

11. Other contents related to the performance of contents agreed upon by the two parties.

Article 5. Modification of validity term of labor contracts with labor contract annexes

The validity term of a labor contract can be modified only once with an annex as long as the type of labor contract entered into remains unchanged, except for the extension of the validity term of a labor contract with an elderly employee or a part-time trade union cadre prescribed in Clause 6, Article 192 of the Labor Code.

Article 6. Labor contracts with elderly employees

1. Where an employer still needs an elderly employee who is physically fit as concluded by a medical examination and treatment establishment established and operating in accordance with law, the two parties may reach an agreement on extension of the term of their labor contract or enter into a new labor contract.

2. Where an employer no long needs to employ an elderly employee or an elderly employee is no longer physically fit, the two parties shall terminate their labor contract.

Article 7. Notification of results of probation

1. Within 3 days before the expiration of the probation period for an employee performing a job subject to the probation period specified in Clauses 1 and 2, Article 27 of the Labor Code, an employer shall notify the employee results of the probation job. If the performed probation job is satisfactory, the employer shall enter into a labor contract with the employee upon the expiration of the probation period.

2. Upon the expiration of the probation period for an employee performing a job subject to the probation period specified in Clause 3, Article 27 of the Labor Code, an employer shall notify the employee of results of the probation job. If the performed probation job is satisfactory, the employer shall immediately enter into a labor contract with the employee.

Section 2

PERFORMANCE OF LABOR CONTRACTS

Article 8. Temporary assignment of employees to perform other jobs

The employer’s temporary assignment of employees to perform jobs which are not stated in labor contracts specified in Clause 1, Article 31 of the Labor Code is provided as follows:

1. An employer may temporarily assign an employee to perform a job which is not stated in the labor contract when:

a/ A natural disaster, fire or epidemic occurs;

b/ A measure to prevent or remedy a labor accident or an occupational disease is applied;

c/ An electricity or water supply incident occurs;

d/ A production or business need arises.

2. An employer shall specify in his/her enterprise’s internal regulations cases in which an employee is temporarily assigned to perform another job which is not stated in the labor contract to meet a production or business need.

3. If an employer has temporarily assigned an employee to perform a job which is not stated in the labor contract for 60 accumulated working days within one year, and has to continue doing so, the employee’s written consent is required.

4. If an employee refuses to be temporarily assigned to perform a job which is not stated in the labor contract under Clause 3 of this Article and quits his/her job, the employer shall pay a severance under Clause 1, Article 98 of the Labor Code.

Article 9. Agreements on suspension of labor contracts when employees are appointed or assigned to act as representatives for state-contributed capital

1. An employer and employee in a state-owned single-member limited liability company or a single-member limited liability company owned by a parent company being a state economic group or state corporation or a parent company in the parent company-subsidiary company model shall reach agreement on suspension of a labor contract in the following cases:

a/ The employee is appointed by a competent authority as a member of the Members’ Council or the president, controller, general director (director) or chief accountant of the company;

b/ The employee is assigned by a competent authority to act as a representative for the state capital and work in an enterprise with a state capital contribution or a parent company operating after the parent company-subsidiary company model.

2. The period of suspension of a labor contract is the time during which the employee is appointed or assigned to act as a representative of state capital and work in an enterprise with a state capital contribution or a parent company operating after the parent company-subsidiary company model.

Article 10. Reinstatement of employees upon the expiration of the period of suspension of labor contracts

The reinstatement of an employee upon the expiration of the period of suspension of a labor contract prescribed in Article 33 of the Labor Code is provided as follows:

1. Within 15 days after the expiration of the period of suspension of a labor contract, the employee shall show up at the workplace and the employer shall reinstate the employee. In case the employee cannot show up at the workplace within the prescribed time limit, he/she shall reach agreement with his/her employer on the date when he/she will show up.

2. The employer shall assign the employee to perform the job as stated in the signed labor contract; in case the employer cannot assign the job stated in the signed labor contract, the two parties shall reach agreement on a new job and modify the signed labor contract or enter into a new one.

Section 3

MODIFICATION, SUPPLEMENTATION OR TERMINATION OF LABOR CONTRACTS

Article 11. Unilateral termination of labor contracts by employees

1. An employee may unilaterally terminate a labor contract under Point c, Clause 1, Article 37 of the Labor Code if he/she is physically or verbally attacked by the employer, subject to the latter’s act offending or affecting his/her health, dignity or honor or subject to forced labor or sexual harassment at workplace.

2. An employee may unilaterally terminate the labor contract prescribed at Point d, Clause 1, Article 37 of the Labor Code in the following cases:

a/ He/she has to take care of his/her spouse, parent or parent-in-law or blood or adopted child who is ill or has an accident;

b/ He/she goes abroad to live or work;

c/ His/her family meets with difficulties due to natural disaster, fire, epidemic or change of residence, making him/her unable to continue performing the labor contract despite his/her efforts.

Article 12. Unilateral termination of labor contracts by employers

The right of an employer to unilaterally terminate a labor contract prescribed at Points a and c, Clause 1, Article 38 of the Labor Code is provided as follows:

1. An employer shall specify the criteria for assessing complete performance of jobs in the internal regulations which shall serve as bases for assessment that an employee often fails to completely perform his/her job stated in the labor contract. The employer shall promulgate the regulation on assessment of complete performance of jobs after receiving opinions of the organization representing the grassroots-level employees’ collective.

2. In the following force majeure circumstances:

a/ Enemy sabotage, epidemic;

b/ Relocation or narrowing of the production or business establishment upon request of a competent state agency.

Article 13. Structural or technological changes and economic reasons

1. Structural or technological changes specified in Clause 1, Article 44 of the Labor Code include the following:

a/ Changes in organizational structure or workforce reorganization;

b/ Changes in products or product structure;

c/ Changes in production and business processes, technologies, machines or equipment involved in production and business lines of the employer.

2. Economic reasons specified in Clause 2, Article 44 of the Labor Code include the following:

a/ Economic crisis or recession;

b/ Implementation of state policies upon the economic restructuring or realization of international commitments.

3. In case a structural or technological change or another economic reason affects the employment or poses the risk of unemployment or layoff of at least 2 employees, the employer shall perform the obligation prescribed in Article 44 of the Labor Code.

Article 14. Severance allowance and job-loss allowance

1. In case a labor contract is terminated under Clause 1, 2, 3, 5, 6, 7 or 9, Article 36 of the Labor Code, or an employer unilaterally terminates a labor contract under Article 38 of the Labor Code, the employer shall pay a severance allowance prescribed in Article 48 of the Labor Code to the employee who has worked continuously for at least full 12 months.

2. An employer shall pay a job-loss allowance under Article 49 of the Labor Code to an employee who has worked continuously for him/her/it for at least 12 months and loses the job due to a structural or technological change or an economic reason, merger, consolidation, splitting or separation of the enterprise or cooperative under Clause 10, Article 36, Articles 44 and 45 of the Labor Code.

3. The working period used for the calculation of severance allowance and job-loss allowance is the total period during which the employee actually works for the employer minus the period during which the employee benefits from unemployment insurance in accordance with law, and the working period for which the employee has received severance allowance from the employer. In which:

a/ Period during which the employee actually works for the employer includes period during which the employee works for the employer; probation period and period of apprenticeship and on-the-job training; period during which the employee is sent to refresher courses by the employer; paid leaves in accordance with the Law on Social Insurance, weekly rest days under Article 110, paid leaves under Articles 111, 112, 115 and Clause 1, Article 116 of the Labor Code; days off for trade union activities in accordance with the law on trade union; period of layoff not due to fault of the employee; period of suspension from work and period of custodial holding or temporary detention, which are followed by the employee’s return to work after a competent state agency concludes that the employee is not guilty;

b/ Period during which the employee benefits from unemployment insurance includes period during which the employer pays unemployment insurance premiums in accordance with law and period during which the employer simultaneously pays to the employee a wage and an amount equal to the unemployment insurance premium prescribed by law;

c/ The working period used for the calculation of severance allowance and job-loss allowance is calculated in years (full 12 months) plus a half for between full 1 and under 6 odd months; or one full year for over full 6 odd months.

4. Severance allowance and job-loss allowance are provided in some special cases as follows:

a/ In case the employee who has actually worked for the employer for at least full 12 months loses his/her job, but his/her working period used for the calculation of job-loss allowance is under 18 months, the employer shall pay to the employee a job-loss allowance equal to at least 2 months’ wage;

b/ After an enterprise or a cooperative is merged, consolidated, split or separated, if the employee terminates the labor contract, the employer shall pay severance allowance or job-loss allowance for the period during which the employee has worked for him/her/it or the period during which the employee has worked prior to the merger, consolidation, splitting or separation of the enterprise or cooperative.

5. Within 7 working days after the termination of the labor contract, the employer shall fully pay severance allowance or job-loss allowance to the employee. The time limit for payment may be extended but must not exceed 30 days from the date of termination of the labor contract in one of the following cases:

a/ The employer that is not an individual ceases its operation;

b/ The employer or employee encounters a natural disaster, fire, enemy sabotage or epidemic;

c/ The employer undergoes restructuring or technological change, or has another economic reason specified in Article 13 of this Decree.

6. Expenses for payment of severance allowance and job-loss allowance are accounted as production and business expenses or operation expenses of employers.

Article 15. Responsibility of employers to elaborate labor employment plans, calculate and pay severance allowance and job-loss allowance in case of transferring asset ownership or use right of enterprises

1. In case of transferring asset ownership or use right of an enterprise, the previous employer shall elaborate a labor employment plan under Article 46 of the Labor Code.

2. In case the labor contract of an employee is terminated under the labor employment plan under Clause 1 of this Article, the employer shall calculate and pay job-loss allowance under Article 49 of the Labor Code.

3. In case the employee continues to be employed or sent to a refresher course for continued employment or transferred to work on a part-time basis in the enterprise after the transfer of asset ownership or use right under the labor employment plan under Clause 1 of this Article, when his/her labor contract is terminated, the succeeding employer shall calculate and pay severance allowance under Article 48 or job-loss allowance under Article 49 of the Labor Code for the period during which the employee actually works for the employer and severance allowance for the period during which the employee actually works in enterprise before the enterprise transfers asset ownership or use right, including the period during which the employee works in the state sector where he/she has been last recruited in the transferring enterprise prior to January 1, 1995.

4. After the transfer of asset ownership or use right of the enterprise, if the employer continues transferring asset ownership or use right of part or the whole of the enterprise, he/she/it shall, before and after the transfer, comply with the provisions of Clauses 1, 2, and 3 of this Article. 

Chapter III

COLLECTIVE BARGAINING, COLLECTIVE LABOR AGREEMENTS

Article 16. Periodical collective bargaining

Periodical collective bargaining under Clause 2, Article 67 of the Labor Code shall be conducted at least once a year. Two parties shall reach an agreement on the time of conducting periodical collective bargaining.

Article 17. Responsibility of trade unions, organizations representing employers and state management agency in charge of labor to participate in collective bargaining meetings

1. When receiving a written request of either party to the collective bargaining, the Vietnam General Confederation of Labor, trade unions of provinces and centrally-run cities, intermediate superior trade unions, organizations representing employers at the central and local level, the Ministry of Labor, War Invalids and Social Affairs, and provincial-level and district-level People’s Committees shall assign their officials to participate in collective bargaining meetings.

2. Officials who are assigned by the above agencies and organizations to participate in collective bargaining meetings shall provide information related to bargaining contents and guidance on the labor law to collective bargaining participants.

Article 18. Signatories to collective labor agreements of enterprises

1. Signatories to an enterprise’s collective labor agreement under Clause 1, Article 83 of the Labor Code are provided as follows:

a/ The chairperson of the grassroots trade union or immediate superior trade union in a locality where no grassroots trade union is available, for the employee collective;

b/ The at-law representative stated in the enterprise’s or cooperative’s charter, or the leader of an agency or organization, or an individual employer stated in the labor contract, for the employer.

2. In case signatories to a collective labor agreement provided in Clause 1 of this Article do not personally sign such agreement, they may lawfully authorize in writing another person to do so. Authorized persons may not further authorize other persons to sign the collective labor agreement.

Article 19. Responsibilities of the state management agency in charge of labor to receive collective labor agreements

Responsibilities of the state management agency in charge of labor when receiving collective labor agreements are as follows:

1. To keep a collective labor agreement register made according to the form set by the Ministry of Labor, War Invalids and Social Affairs.

2. Within 15 days after receiving the collective labor agreement, if detecting any illegal content in such agreement or it is signed ultra vires, the state management agency shall request in writing a people’s court to declare the collective labor agreement invalid, and concurrently send such request to the two parties to the agreement.

In case the collective labor agreement has not taken effect, the state management agency shall request in writing the two parties to negotiate on modifying or supplementing the agreement and then send it to the state management agency under regulations.

Article 20. Petitions for declaring collective labor agreements invalid

When inspecting or settling labor-related complaints or denunciations, if detecting that the collective labor agreement falls into one of the cases specified in Article 78 of the Labor Code, the head of the inspection team or an independent labor inspector or a person in charge of specialized inspection shall make a written record of invalid collective labor agreement, and concurrently make request in writing a people’s court to declare the collective labor agreement invalid.

Chapter IV

WAGES

Article 21. Wages

Wages provided in Clauses 1 and 2, Article 90 of the Labor Code are as follows:

1. Wage stated in a labor contract between an employee and an employer for performing a job, including:

a/ Wage based on the job or title is a wage amount stated in the wage scale or table made by the employer under Article 93 of the Labor Code. Wage paid for an employee who performs the simplest job in normal working conditions and normal working time (excluding additional amounts paid for overtime or night work) must not be lower than the regional minimum wage stipulated by the Government;

b/ Wage allowance is an amount to compensate for poor working conditions, complexity of jobs, low living standards or labor attraction which are neither included  nor fully included in the wage level based on the job or title;

c/ Additional payments are those paid in addition to wage and wage allowance and related to the performance of job or title in the labor contract, excluding bonus, mid-shift meal payment, supports and allowances paid by the employer and not related to the performance of the job or title in the labor contract.

2. Wage paid to an employee must be based on the wage amount stated in the labor contract, labor productivity, and volume and quality of the job performed by the employee.

3. Wage stated in the labor contract and wage paid to the employee must be in Vietnam dong, except wage and wage allowance paid to non-residents or residents who are foreigners in accordance with the law on foreign exchange.

Article 22. Forms of wage payment 

Forms of wage payment under Clause 1, Article 94 of the Labor Code are provided as follows:

1. Wage payment based on working time is paid to an employee based on the actual working time calculated on a monthly, weekly, daily or hourly basis, specifically as follows:

a/ Monthly wage is paid for a working month on the basis of the labor contract;

b/ Weekly wage is paid for a working week determined on the basis of monthly wage multiplied by 12 months and then divided by 52 weeks;

c/ Daily wage is paid for a working day determined on the basis of monthly wage divided by the number of normal working days in a month under regulations selected by the enterprise;

d/ Hourly wage is paid for a working hour determined on the basis of daily wage divided by the number of normal working hours in a day under Article 104 of the Labor Code.

2. Product-based wage is paid on the basis of the quantitative and qualitative completion of a product according to labor norms and assigned product unit cost.

3. Piecework-based wage is paid on the basis of the volume and quality of a work and the time for completion thereof.

Article 23. Wage payment period for employees enjoying monthly wage

1. An employee enjoying a monthly wage shall be paid once a month or once a half-month.

2. Time of wage payment must be agreed by the two parties and falls on a particular day of a month.

Article 24. Principles of wage payment

1. Employees shall be paid with full wage in a direct and timely manner.

2. In special cases where due to a natural disaster, fire or force majeure circumstance an employer cannot pay wage on time to an employee as agreed upon in their labor contract despite his/her efforts to find a remedial measure, the employer may not delay the payment for more than 1 month. An additional amount that must be paid by the employer to the employee to compensate for late wage payment is provided as follows:

a/ If wage is paid late for under 15 days, the employer is not required to pay any additional amount;

b/ If wage is paid late for 15 days or more, the employer shall pay to the employee an additional amount at least equal to the late paid amount multiplied by the ceiling interest rate for one-month time deposits announced by the State Bank of Vietnam at the time of wage payment. If the State Bank of Vietnam does not provide the ceiling interest rate, such additional amount shall be calculated at the interest rate for one-month time deposits announced by the commercial bank at which the enterprise or agency opens the transaction account at the time of wage payment.

Article 25. Wage for overtime and night work

1. An employee shall be paid for overtime work under Clause 1, Article 97 of the Labor Code as follows:

a/ An employee enjoying a time-based wage shall be paid for overtime work performed beyond the normal working hours prescribed by the employer under Article 104 of the Labor Code;

b/ An employee enjoying a product-based wage shall be paid for overtime work performed beyond the normal working hours to make a product quantity or work volume in addition to the product quantity or work volume completed according to labor norms as agreed with the employer.

2. Wage for overtime work under Clause 1 of this Article shall be calculated according to the prescribed wage unit or wage actually paid for the current job as follows:

a/ On weekdays, it is at least equal to 150% of the normal wage;

b/ On weekends, it is at least equal to 200% of the normal wage;

c/ On public holidays and paid days off, it is at least equal to 300% of the normal wage, excluding the wage for public holidays and paid days off of employees who receive daily wages under the Labor Code.

3. An employee who performs night work under Clause 2, Article 97 of the Labor Code shall be paid an additional amount at least equal to 30% of the wage calculated according to the prescribed wage unit or the wage actually paid for a job of a normal workday.

4. An employee who performs overtime work at night under Clause 3, Article 97 of the Labor Code shall, in addition to wage paid under Clause 2 or 3 of this Article, be paid an additional amount equal to 20% of the wage calculated according to the prescribed wage unit or the wage actually paid for a daytime job of a normal workday, weekend or public holiday.

5. An employee who performs overtime work on a public holiday falling on a weekend under Article 110 of the Labor Code shall be paid wage for overtime work on public holidays. An employee who performs overtime work on a compensatory day off for a public holiday falling on a weekend under Clause 3, Article 115 of the Labor Code shall be paid wage for overtime work on weekends.

6. Wage paid to an employee working overtime or at night under Clause 2, 3, 4 or 5 of this Article must be calculated corresponding to the forms of wage payment specified in Article 22 of this Decree.

Article 26. Wage used as a basis for wage payment to employees during work suspension, on annual leave, public holidays and paid leaves for personal reasons, advance payment and deduction of wages

1. Wage used as a basis for wage payment to employees during work suspension under Clause 1, Article 98 of the Labor Code is that stated in the labor contract when the employee is suspended from work and shall be calculated corresponding to the forms of time-based wage payment under Clause 1, Article 22 of this Decree.

2. Wage used as a basis for wage payment to employees on annual leave under Article 111; additional days of annual leave for seniority under Article 112; public and New Year holidays under Article 115 and paid leaves for personal reasons under Clause 1, Article 116 of the Labor Code is that stated in the labor contract of the preceding month divided by the number of normal working days in the month as prescribed by the employer, and then multiplied by the number of days of the annual leave, additional days of annual leave for seniority, public and New Year holidays or paid leaves for personal reasons of the employee

3. Wage used as a basis for wage payment to employees who have not taken or fully taken their annual leave under Article 114 of the Labor Code is provided as follows:

a/ An employee who has worked for full 6 months or more shall be paid an amount equal to the average wage paid under the labor contract for 6 months before the employee quits or loses the job. An employee who, for other reasons, has not taken or fully taken the annual leave shall be paid an amount equal to the average wage paid under the labor contract for 6 months before the employer calculates and pays to the employee for untaken annual leave days;

b/ An employee who has worked for under 6 months shall be paid an amount equal to the average wage paid under the labor contract for the whole working time.

4. Wage calculated and paid to an employee for untaken annual leave days is the wage prescribed in Clause 3 of this Article divided by the number of normal working days, as prescribed by the employer, of the month preceding the date of wage calculation and payment by the employer, and then multiplied by untaken annual leave days.

5. Wage used as a basis for advance payment of a wage amount to an employee for days off which he/she takes to perform citizens’ obligations under Clause 2, Article 100 or during which he/she is suspended from work under Article 129 of the Labor Code is the wage paid under the labor contract for the month before the employee takes days off or is suspended from work, and shall be calculated corresponding to the forms of time-based wage payment under Clause 1, Article 22 of this Decree.

6. Wage used as a basis for deducting wage of an employee for compensation for tool and equipment damage under Clause 1, Article 130 of the Labor Code is the monthly wage actually received by the employee after paying compulsory social insurance, health insurance and unemployment insurance premiums and personal income tax (if any) in accordance with law.

Chapter V

LABOR DISCIPLINE, MATERIAL RESPONSIBILITY

Section 1

LABOR DISCIPLINE

Article 27. Contents of internal working regulations

The principal contents of internal working regulations prescribed in Clause 2, Article 119 of the Labor Code are specified as follows:

1. Working time and rest time: Normal working time of a day and a week, work shifts; starting time and ending time of a work shift; overtime work (if any), overtime work in special cases; short breaks in addition to mid-shift rest time; rest time between shifts; weekly days off, annual leave, leaves for personal reasons, and unpaid leaves.

2. Order at workplace: Working areas, movements during working time, behavioral culture, uniform, obedience of employers’ assignment and mobilization (except where employees clearly see risks of labor accident or occupational disease which may seriously threaten their life and health).

3. Labor safety and labor sanitation at workplace: Responsibility to thoroughly understand regulations on labor safety and sanitation and fire and exploration prevention and fighting; obedience of measures for ensuring labor safety, labor sanitation, prevention of labor accidents and occupational diseases; obedience of internal regulations, order, regulations and standards on labor safety and sanitation; use and maintenance of personal protection equipment; and cleaning, sterilization and disinfection at workplaces.

4. Protection of assets, technology and business secrets and intellectual property rights of employers: Lists of to-be-protected assets, documents, technology and business secrets and intellectual property rights falling within the scope of the assigned responsibility.

5. Acts violating labor discipline, forms of handling violations of labor discipline, and material responsibility: The lists of violations and their seriousness corresponding to forms of handling violations of labor discipline; damage levels and responsibility for damage compensation.

Article 28. Registration of and effect of internal working regulations

1. Within 10 days after issuing internal working regulations, an employer shall submit a dossier for registration of internal working regulations to the provincial-level state management agency in charge of labor of the locality where he/she/it has registered business.

2. Upon receiving a complete dossier for registration of internal working regulations, the provincial-level state management agency in charge of labor shall grant a written confirmation of receipt of the dossier to the employer.

3. Within 7 working days after receiving the dossier for registration of internal working regulations, if these internal working regulations are contrary to law, the provincial-level state management agency in charge of labor shall issue a written notice to the employer  to guide him/her/it in modifying, supplementing and re-registering the internal working regulations.

4. Upon receiving the written notice that the internal working regulations are contrary to law, the employer shall modify or supplement such regulations, and consult the organization representing the grassroots employee collective and re-register the regulations.

5. In case of modifying or supplementing the effective internal working regulations, an employer shall consult the organization representing a grassroots employee collective and re-register the internal working regulations.

6. A dossier for re-registration of internal working regulations specified in Clause 4 or 5 of this Article is the same as the dossier for registration of the internal working regulations.

7. Internal working regulations take effect 15 days after the provincial-level state management agency in charge of labor receives the registration or re-registration dossier.

8. An employer that has branches, units or production or business establishments located in different provinces and centrally run cities shall send effective internal working regulations to provincial-level state management agencies in charge of labor in localities where such branches, units and production or business establishments are based.

9. Employers that employ less than 10 employees do not need to register their internal working regulations.

Article 29.  Labor discipline for employees nursing children under 12 months of age

1. Employers may not impose labor discipline on employees who are blood parents or legally adoptive parents nursing children under 12 months of age.

2. Upon the expiration of the period of nursing a child under 12 months of age, if the statute of limitations for imposing labor discipline has expired, it may be extended for no more than 60 days from the expiration date.

Article 30. Order of imposing labor discipline

The order of imposing labor discipline prescribed in Article 123 of the Labor Code is specified as follows:

1. An employer shall send a written notice of the participation in the meeting on labor discipline to the executive committee of the grassroots trade union or the executive committee of the immediate superior trade union for a non-unionized enterprise, employees, parents or at-law representatives of under-18 employees at least 5 working days before the meeting.

2. The meeting for labor discipline shall be held when all parties invited under Clause 1 of this Article are present. In case the employer has already sent a written notice 3 times but one of the invited parties is still absent, the employer may hold the meeting, except where employees are still in the period of being subject to no labor discipline under Clause 4, Article 123 of the Labor Code.

3. The meeting for labor discipline shall be recorded in minutes which is approved by all participants before its end. Such minutes shall be signed by all participants under Clause 1 of this Article and the maker. In case one of the participants refuses to sign the minutes, the reason must be clearly stated.

4. Persons entering into labor contracts defined at Points a, b, c and d, Clause 1, Article 3 of this Decree are competent to issue decisions on labor discipline to be imposed on employees. Persons authorized to sign labor contracts are only competent to impose labor discipline in the form of reprimand.

5. A decision on labor discipline shall be issued within the statute of limitations for imposing labor discipline or the extended one under Article 124 of the Labor Code. Such decision shall be sent to participants in the meeting on labor discipline.

Article 31. Dismissal of employees absent from work without permission

1. Dismissal applied to employees absent from work without permission for a total of 5 working days accumulated within 30 days, or 20 days accumulated within 365 days, from the first day of being absent from work without plausible reasons.

2. An employee shall be regarded as absent from work with plausible reasons in the following cases:

a/ Natural disasters and fire;

b/ Illness of the employee or his/her blood parents, adoptive parents, parents in-law, spouse, blood children or legally adopted children as certified by a competent health establishment founded and operating in accordance with law.

c/ Other cases specified in internal working regulations.

Section 2

MATERIAL RESPONSIBILITY

Article 32. Compensation for damage

Compensation for damage prescribed in Article 130 of the Labor Code is specified as follows:

1. An employee shall pay a compensation equal to no more than 3 months’ wage paid under his/her labor contract for the month before the damage is caused in the form of monthly deduction from his/her wage under Clause 3, Article 101 of the Labor Code if he/she negligently causes damage to tools and equipment valued at no more than 10 months’ region-based minimum wage announced by the Government and applied at his/her workplace,.

2. The employee shall pay a compensation for the whole or part of the damage at the market price if falling in one of the following cases:

a/ Due to negligence, he/she causes damage to tools or equipment valued at more than 10 months’ region-based minimum wage announced by the Government and applied at his/her workplace;

b/ He/she loses tools, equipment or assets of the employer or other assets provided to him/her by the employer;

c/ He/she uses supplies in excess of the permitted norm.

3. In case an employee causing damage to an employer under Clause 2 of this Article enters into a contract of responsibility with such employer, the amount of compensation must comply with such contract.

4. In case the damage is caused by a natural disaster, fire, enemy sabotage, epidemic, catastrophe or another objective event which is unforeseeable and irremediable and the employer has taken every necessary measure in full ability, the employee is not required to pay compensation.

5. The order, procedures and statute of limitations for paying compensations for damage must comply with the order, procedures and time limit for imposing labor discipline.

Article 33. Complaints about labor discipline and material responsibility

1. An employee who is handled for violation of labor discipline, suspended from work, or required to pay compensation in accordance with the regime of material responsibility but not satisfied with the handling decision may file a complaint with the employer or a competent agency defined by law, or request settlement of a personal labor dispute according to the procedures prescribed in Article 201 of the Labor Code.

2. When a state agency competent to settle complaints makes a conclusion different from the employer’s decision on handling violation of labor discipline, suspension from work or payment of compensation for damage according to the regime of material responsibility, the employer shall cancel such decision or issue another decision replacing it and notify such to employee of the enterprise.

3. An employer shall restore the rights and interests of an employee infringed upon due to his/her/its decision on handling violation of labor discipline, suspension from work or payment of compensation for damage. In case of unlawful dismissal of the employee, the employer shall comply with the provisions of Clauses 1, 2, 3 and 4, Article 42 of the Labor Code.

Chapter VI

SETTLEMENT OF LABOR DISPUTES

Article 34. Labor Arbitration Council

1. The Labor Arbitration Council defined in Article 199 of the Labor Code is composed of:

a/ Its chairperson who is the head of the provincial-level state management agency in charge of labor;

b/ Its secretary;

c/ Its members who are representatives of provincial-level trade unions and organizations representing employers.

2. The chairperson and members of the Council work on a part-time basis, with a term of office of 5 years.

3. The secretary of the Council is on the payroll of the provincial-level Labor, War Invalids and Social Affairs Department, works on a full-time basis and enjoys a responsibility allowance equivalent to position-based allowance for heads of divisions of the Department.

4. The chairperson of the Council shall issue the Council’s working regulation.

Article 35. Handling of strikes that do not follow the prescribed sequence and procedures

The handling of strikes that do not follow the prescribed sequence and procedures prescribed in Article 222 of the Labor Code is provided as follows:

1. A chairperson of a provincial-level People’s Committee may declare that a strike violates the prescribed sequence and procedures according to the following provisions:

a/ When the organization and leadership of the strike do not comply with Articles 212 and 213 of the Labor Code, an employer shall promptly notify such to the chairperson of the district-level People’s Committee and the Labor Confederation of the district, town or provincial city or the trade union of the industrial park, export processing zone, economic zone or hi-tech park where the strike takes place;

b/ Right after receiving the notification of the employer, the chairperson of the district-level People’s Committee shall direct the Labor, War Invalids and Social Affairs division to coordinate with the Labor Confederation of the district, town or provincial city or the trade union of the industrial park, export processing zone, economic zone or hi-tech park where the strike takes place in inspecting the matter. Within 24 hours after receiving the direction, the Labor, War Invalids and Social Affairs division shall report the inspection results to the chairperson of the district-level People’s Committee;

c/ In case the strike does not follow the prescribed sequence and procedures, within 12 hours after receiving the Labor, War Invalids and Social Affairs division’s report, the chairperson of the district-level People’s Committee shall propose in writing the chairperson of the provincial-level People’s Committee to decide to declare that a strike violates the prescribed sequence and procedures;

d/ Within 12 hours after receiving a proposal of the chairperson of the district-level People’s Committee, the chairperson of the provincial-level People’s Committee shall issue a decision declaring that a strike violates the prescribed sequence and procedures, and notify such to the chairperson of the district-level People’s Committee.

2. Within 12 hours after receiving the decision declaring that a strike violates the prescribed sequence and procedures of the chairperson of the provincial-level People’s Committee, the chairperson of the district-level People’s Committee shall direct the Labor, War Invalid and Social Affairs division to assume the prime responsibility for, and coordinate with the Labor Confederation of the district, town or provincial city or the trade union of the industrial park, export processing zone, economic zone or hi-tech park where the strike takes place, and related agencies and organizations in, directly organizing a meeting with the employer and the executive committee of the grassroots-level trade union or immediate superior trade union for a non-unionized enterprise to listen to opinions and support both sides in solving the problems.

3. Employees participating in a strike that violates the prescribed sequence and procedures are not entitled to wage and other interests provided by law during the time they participate in the strike. Employees who do not participate in the strike but have to suspend their work due to the strike are still entitled to wage for the suspension period as prescribed in Clause 2, Article 98 of the Labor Code and other interests provided by the labor law.

Article 36. Compensation for damage caused by illegal strikes

The compensation for damage caused by illegal strikes defined in Clause 1, Article 233 of the Labor Code is specified as follows:

1. An employer shall determine the value of damage caused by an illegal strike, including:

a/ Damage of machinery, equipment, materials, fuels, semi-finished products and finished products after subtracting their value recovered through liquidation or recycling (if any);

b/ Expenses for remediation of consequences caused by the illegal strike, including expense for operation of machinery and equipment under technological requirements; repair and replacement of damaged machinery and equipment; recycling of damaged materials, fuels, semi-finished products and finished products; preservation of materials, fuels, semi-finished products and finished products during the strike; environmental sanitation; customer compensation or payment of fines for contract breaches due to the strike.

2. An employer shall request in writing the trade union leading the illegal strike to compensate for the damage. The written request must have the following principal contents:

a/ The value of damage caused by the illegal strike as prescribed in Clause 1 of this Article;

b/ The value of the requested compensation;

c/ The compensation payment time limit.

3. Based on the employer’s written request for compensation for damage, a representative of the trade union directly leading the strike shall pay compensation for damage under regulations.

In case of disagreeing with the damage value, compensation value and compensation payment time limit requested by the employer, within 5 working days after receiving the written request, the representative of the trade union directly leading the strike shall request in writing the employer to conduct a negotiation on disagreed contents.

After the negotiation, if reaching agreement, the two parties shall implement the agreed contents. If not, either party may request a court to settle the case in accordance with law.

Chapter VII

IMPLEMENTATION PROVISIONS

Article 37. Effect

1. This Decree takes effect on March 1, 2015.

2. The Government’s Decree No. 196/CP of December 31, 1994, detailing and guiding a number of articles of the Labor Code regarding collective labor agreements; Decree No. 93/2002/ND-CP of November 11, 2002, amending and supplementing a number of articles of the Government’s Decree No. 196/CP; Decree No. 41/CP of July 6, 1995, detailing and guiding a number of articles of the Labor Code regarding labor discipline and material responsibility; Decree No. 33/2003/ND-CP of April 2, 2003, amending and supplementing a number of articles of Decree No. 41/CP; Decree No. 11/2008/ND-CP of January 30, 2008, on compensation for damage caused by illegal strikes to employers; and other previous regulations which are contrary to this Decree shall cease to be effective on the effective date of this Decree.

Article 38. Transitional provisions

1. Related parties shall review, revise or carry out procedures for promulgating labor contracts, collective labor agreements, internal working regulations and other regulations which are signed or issued by employers before the effective date of this Decree.

2. Wholly stated-owned enterprises or enterprises which are equitized from state enterprises, when terminating labor contracts with employees who have worked in state agencies, organizations, units or enterprises before being transferred to work for them prior to January 1, 1995, but have not yet received any severance allowance or job-loss allowance, shall pay severance allowance or job-loss allowance for the period during which these employees work for them, and severance allowance for the period during which these employees work for such state agencies, organizations, units or enterprises.

3. The duration of labor contract suspension as prescribed in Article 9 of this Decree of an employee, who works in a state-owned single-member limited liability company and is appointed by a competent authority to act as a member of such company’s Members’ Council or president, general director (director), deputy general director (deputy director), supervisor, chief accountant or representative of the contributed capital, and works in other enterprises before the effective date of this Decree, shall be counted from the date of appointment to act a representative of the contributed capital.

Article 39. Implementation responsibility

1. The Minister of Labor, War Invalids and Social Affairs shall guide this Decree.

2. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees and related agencies, organizations, enterprises and individuals shall implement this Decree.-

On behalf of the Government
Prime Minister
NGUYEN TAN DUNG