Decree No. 39/2003/ND-CP dated April 18, 2003 of the Government detailing and guiding the implementation of a number of articles of the Labor Code regarding employment

DECREE

DETAILING AND GUIDING THE IMPLEMENTATION OF A NUMBER OF ARTICLES OF THE LABOR CODE REGARDING EMPLOYMENT

THE GOVERNMENT

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

Pursuant to the June 23, 1994 Labor Code and the April 2, 2002 Law amending and supplementing a number of articles of the Labor Code;

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

DECREES:

Chapter I

EMPLOYMENT PROGRAMS

Article 1.- Job-creation norms and employment support policies

1. The job-creation norms defined in Article 14 of the Labor Code are prescribed as the numbers of new laborers that need to be additionally recruited to work regularly in enterprises, organizations, agencies and for individuals of all economic sectors, that employ laborers under labor contracts, due to the demands for establishment, expansion of scale and activities or labor rearrangement.

2. Formulation and realization of job-creation norms:

a) The programs, projects and plans on socio-economic development must include job-creation norms.

b) Annually, the employing enterprises, organizations, units and individuals shall have to report the results of realization of job-creation norms to the ministries, branches and localities.

c) Annually, the ministries, branches and localities shall have to sum-up and report their job-creation norms to the Ministry of Labor, War Invalids and Social Affairs and the Ministry of Planning and Investment.

d) The Ministry of Labor, War Invalids and Social Affairs shall coordinate with the Ministry of Planning and Investment in guiding, inspecting and reporting to the Government on the results of, realization of five-year and annual job-creation norms.

3. Employment support policies:

a) The Ministry of Finance shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs and the concerned ministries and branches in submitting to the Government for promulgation, or promulgate according to its competence, policies on financial support, tax exemption and reduction, and on the application of other incentive measures for enterprises, organizations, units and individuals of all economic sectors to create jobs for many laborers.

b) Vietnam State Bank shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs in studying and submitting to the Government for promulgation, or promulgate according to its competence, policies on loan provision for laborers to work aboard for definite periods of time, create jobs for themselves and attract many laborers.

c) The Ministry of Science and Technology shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs in studying and submitting to the Government for promulgation, or promulgate according to its competence, policies to encourage the development of new technologies and techniques involving many laborers.

d) The Committee for Nationalities shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs and the concerned ministries and branches in studying and submitting to the Government for promulgation, or promulgate according to its competence, preferential employment policies so as to attract and employ laborers being ethnic minority people.

e) The Ministry of Agriculture and Rural Development shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs and the concerned ministries and branches in studying and promulgating policies to encourage job creation in rural areas.

f) The Ministry of Labor, War Invalids and Social Affairs shall have to study and submit to the Government for promulgation or promulgate according to its competence:

- Policies on support for job creation for female laborers and laborers being disabled;

- Policies on job-training and retraining for laborers.

g) The Ministry of Education and Training shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs as well as other concerned ministries and branches in studying and submitting to the Government for promulgation, or promulgate according to its competence:

- Policies to encourage the laborers to study and raise their qualifications in order to meet requirements of the development of production and new technologies;

- Policies on job creation for students and pupils having graduated from universities, colleges and intermediate vocational schools.

h) The Ministry of Defense and the Ministry of Public Security shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs as well as other concerned ministries and branches in studying, formulating and submitting to the Government for promulgation, or promulgate according to its competence, policies on job creation for armymen and policemen, who have fulfilled their duties.

Article 2.- National employment program:

1. The national employment program defined in Clause 1, Article 15 of the Labor Code, covers: objectives, norms, operation contents, time, solutions, financial sources, implementation organization and program management.

2. The Ministry of Labor, War Invalids and Social Affairs shall assume the prime responsibility and coordinate with the Ministry of Planning and Investment and the Ministry of Finance in submitting to the Government the national employment program and submitting to the Prime Minister for promulgation the mechanism for management and administration of the operation of the National Employment Fund.

3. The Ministry of Planning and Investment shall assume the prime responsibility and coordinate with the Ministry of Finance and the Ministry of Labor, War Invalids and Social Affairs in working out annual and five-year plans on financial sources for the national employment program.

Article 3.- The National Employment Fund shall be formed and used as follows:

1. The National Employment Fund shall be formed from the following sources:

a) The State budget.

b) Assistance from organizations and individuals at home and abroad.

c) Other assistance sources.

2. The National Employment Fund shall be used for the following purposes:

a) To provide loans capital under small-sized projects to create jobs for several subjects.

b) To provide loans for enterprises to help limit job losers and take on unemployed laborers.

c) To support the consolidation and development of the system of job-recommendation organizations as well as labor market development activities.

Article 4.- Local employment programs

1. Local employment programs defined in Clause 2, Article 15 of the Labor Code cover: objectives, norms, operation contents, time, solutions, financial sources, implementation organization and program management.

2. Annually, the provincial/municipal People’s Committees shall formulate the employment programs and funds of their respective localities and submit them to the People’s Councils of the same levels for decision; and organize the implementation of such decisions and report the results to the Ministry of Labor, War Invalids and Social Affairs and the Ministry of Planning and Investment.

Article 5.- Local employment funds shall be formed and used as follows:

1. Local employment funds shall be formed from the following sources:

a) The local budgets as decided by the provincial/municipal People’s Councils.

b) Assistance from organizations and individuals at home and abroad.

c) Other assistance sources.

2. The local employment funds shall be used for the right objectives of the local employment programs.

Article 6.- The Ministry of Finance shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs and the Ministry of Planning and Investment in formulating and promulgating the Regulation on financial management applicable to the National Employment Fund and the local employment funds.

Chapter II

LABOR RECRUITMENT

Article 7.- The recruitment of Vietnamese labor under the provisions in Clause 2, Article 16 and Clause 1, Article 132 of the Labor Code, is prescribed as follows:

1. Employers may recruit Vietnamese laborers directly or through job-recommending organizations according to their requirements.

2. Laborers may make direct contacts or register at job-recommending organizations in order to find jobs.

Article 8.- Procedures for labor recruitment

1. At least 7 days before receiving the dossiers of registration for recruitment examination from laborers, the employers must announce on the mass media and post up at their headquarters their demands for labor recruitment. The contents thereof cover: professions, jobs, professional qualifications, number of laborers to be recruited, terms of labor contracts, wage levels, working conditions and some other requirements if the enterprises deem them necessary.

2. A dossier of registration for recruitment examination includes:

- The written registration for recruitment examination, made according to the form prescribed by the Ministry of Labor, War Invalids and Social Affairs.

- A copy of the labor book (notarization is not required). In cases where the labor book is not yet granted, there must be a curriculum vitae made according to the form prescribed by the Ministry of Labor, War Invalids and Social Affairs.

- Copies of diplomas and certificates as required for the to be-recruited positions (notarization is not required).

- Paper on health check by competent medical agencies.

- Other papers prescribed by enterprises due to the stringency of the jobs.

3. When receiving the dossiers of registration for recruitment examination, the employers shall have to make records on monitoring books and hand over receipts thereof to the laborers, clearly stating the recruitment time. In cases when the laborers fail or do not sit in the recruitment examination, the employers shall have to return the dossiers to such laborers and take back the receipts.

4. The employers shall have to pay all expenses for labor recruitment (except for dossiers of registration for recruitment examination) and be allowed to account these expenses into their production costs or circulation charges.

5. The employers that recruit laborers through job-recommending organizations shall have to pay job-recommendation charges to these job-recommending organizations as prescribed by law.

6. The laborers, who register to find jobs through job-recommending organizations shall also have to submit to such job-recommending organizations their dossiers as prescribed in Clause 2 of this Article and if they are employed, they must pay job-recommendation charges to job-recommending organizations as prescribed by law. The laborers who register to find jobs through job-recommending organizations under the provisions in Clause 1, Article 15 of this Decree shall be exempt from job-recommendation charges. The State shall support job-recommending centers for the latter to find jobs for the laborers.

Article 9.- The granting of labor books to laborers under the provisions in Article 183 of the Labor Code is prescribed as follows:

1. Laborers working under labor contracts in all enterprises, organizations, units or for individuals shall be granted labor books.

2. Those who are aged full 15 years or older, have working capacity and have entered into labor contracts shall also be granted labor books.

3. Those who are granted labor books shall have to pay expenses for printing and distribution of labor books.

The Ministry of Labor, War Invalids and Social Affairs shall prescribe the form as well as the granting, use and management of labor books.

Article 10.- The employers, the ministries, branches and localities shall have to make periodical reports on labor recruitment and use according to the stipulations of the Ministry of Labor, War Invalids and Social Affairs.

Chapter III

JOB-LOSS ALLOWANCE

Article 11.- The following cases shall be considered restructuring or technological change as prescribed in Clause 1, Article 17 of the Labor Code:

1. Replacing all or part of machinery, equipment and technological process with advanced ones of higher labor productivity.

2. Changing products or product structures leading to the use of less laborers.

3. Changing the organizational structure: merging and/or dissolving some sections of the units.

If due to the above-stated changes, laborers lose their jobs, the employers shall have to re-train the laborers for new jobs. If the employers fail to create new jobs and let the laborers to leave their jobs, they must pay job-loss allowance according to the provisions in Clause 1, Article 17 of the Labor Code and Articles 12 and 13 of this Decree.

Article 12.- The job-loss allowance levels prescribed in Clause 1, Article 17 of the Labor Code is stipulated as follows:

1. Job-loss allowance shall be calculated on the basis of the wage levels prescribed in the Government’s Decree No. 114/2002/ND-CP of December 31, 2002 detailing and guiding the implementation of a number of articles of the Labor Code on wages and salaries.

2. The time for calculation of job-loss allowance shall be the total time the laborers have actually worked for the employers until they lose their jobs. In cases where the laborers had previously worked in the State sector but not yet received the severance allowance or job-loss allowance, such period of time shall only be calculated for receipt of severance allowance prescribed in Article 42 of the Labor Code. The severance allowance shall be paid by the job-loss allowance reserve funds of the units where the laborers subject to job loss work, together with job-loss allowance.

Particularly for laborers working in enterprises undertaking plans for reorganization and transformation in the form of assignment, purchase, contractual assignment, lease or equitization of enterprises, the labor regimes prescribed by the State for these cases shall apply.

3. The working time entitled to job-loss allowance shall be the period of time of full one year (12 months) or more, in case of odd months, the following provisions shall apply:

a) The period of less than one month shall not be calculated for job-loss allowance.

b) The period of between 1 and under 6 months shall be calculated as equal to 6 months of work for enjoyment of the job-loss allowance equal to half of one month’s salaries.

c) The period of full 6 months or more shall be calculated as equal to 1 year of work for enjoyment of the job-loss allowance equal to one month’s salaries.

4. The job-loss allowance and severance allowance shall be paid directly to laborers in lump-sum at their working places or at places most convenient for the laborers within 7 days as from the date they lose their jobs.

Article 13.- Reserve fund for job-loss allowance as defined in Clause 3, Article 17 of the Labor Code shall be prescribed as follows:

1. Enterprises shall have to set up reserve funds for job-loss allowance so as to pay allowances in time to their laborers subject to job loss.

2. The levels of deduction for job-loss allowance reserve funds shall be between 1% and 3% of the total salary funds used as basis for enterprises to pay the social insurance premiums and be accounted into their production costs or circulation charges.

3. The Ministry of Finance shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs in providing for the setting up, management and use of job-loss allowance reserve funds of enterprises.

Chapter IV

JOB-RECOMMENDING ORGANIZATIONS

Article 14.- Job-recommending organizations defined in Clause 1, Article 18 of the Labor Code include: job-recommending centers and enterprises specialized in job recommendation.

Article 15.- Operation of job-recommending organizations:

1. Job-recommending centers set up by State agencies or socio-political organizations are non-business units with revenues and part of expenses for their regular activities being covered by themselves according to the Government’s Decree No. 10/2002/ND-CP of January 16, 2002, which operate in the social domain, are assigned payroll and norms by the State or socio-political organizations, entitled to investment support from State budget source in term of equipment and facilities, material foundations, financial support, and entitled to tax exemption or reduction as prescribed by law.

2. Enterprises specialized in job-recommending activities must meet all conditions prescribed by the Prime Minister in the Regulation on job-recommending organizations and activities and be granted permits for job-recommending activities by the provincial/municipal People’s Committees.

3. The Ministry of Labor, War Invalids and Social Affairs shall summit to the Prime Minister for promulgation the Regulation on job-recommending organizations and activities.

Chapter V

IMPLEMENTATION ORGANIZATION

Article 16.- This Decree takes effect 15 days after its publication in the Official Gazette.

This Decree replaces the Government’s Decree No. 72/CP of October 31, 1995 detailing and guiding the implementation of a number of articles of the Labor Code on employment.

Article 17.- The Ministry of Labor, War Invalids and Social Affairs, the Ministry of Finance, the Ministry of Planning and Investment and concerned ministries and branches shall, within the scope of their functions, tasks and powers, have to guide the implementation of this Decree.

Article 18.- The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government and the presidents of the provincial/municipal People’s Committees shall have to implement this Decree.