Employment contracts in Vietnam are highly regulated, formal, and employee-protective.
For foreign companies, using the wrong contract type—or the right type incorrectly—can lead to labor disputes, penalties, or unenforceable terminations.
This 2026 guide explains how employment contracts work in Vietnam, the legal contract types, mandatory clauses, probation rules, and how foreign employers stay compliant—especially when hiring through an Employer of Record (EOR).
Are Employment Contracts Mandatory in Vietnam?
Yes. Employment contracts are mandatory.
Under Vietnamese labor law:
- All employees must have a written employment contract
- Contracts must be Vietnam-compliant
- Contracts must be in Vietnamese (or bilingual, with Vietnamese prevailing)
📌 Verbal or overseas-only contracts are not legally valid in Vietnam.
Who Can Sign Employment Contracts?
- Only a Vietnamese legal employer can sign employment contracts
- Foreign companies without a local entity cannot sign directly
- Legal alternatives:
- Hire via an Employer of Record (EOR)
- (High risk) contractor arrangements
This is one of the most common compliance misunderstandings.
Types of Employment Contracts in Vietnam (2026)
Vietnam recognizes two main contract types.
1️⃣ Indefinite-Term Employment Contract
(In Vietnamese: Hợp đồng không xác định thời hạn).
- No end date
- Provides the highest employee protection
- Harder to terminate
- Common after long-term employment
📌 This is the default contract once fixed-term limits are reached.
2️⃣ Fixed-Term Employment Contract
(In Vietnamese: Hợp đồng xác định thời hạn).
- Maximum duration: 36 months
- Can generally be renewed once
- After the second term, the contract usually becomes indefinite
📌 Employers cannot continuously renew fixed-term contracts to avoid permanence.
Probation Clauses in Employment Contracts
Probation can be included within the contract or as a separate agreement, but strict limits apply.
Maximum Probation Periods
| Job Type | Max Probation |
|---|---|
| Managers / specialists | 60 days |
| Skilled roles | 30 days |
| Other roles | 6 days |
Key Rules
- Only one probation period per role
- Probation salary must be at least 85% of official salary
- Probation must be documented
Improper probation handling is a frequent violation.
Mandatory Clauses in Vietnam Employment Contracts
Vietnam labor law requires contracts to include specific terms.
Mandatory Contract Contents
- Job title and description
- Workplace location
- Contract term
- Salary, allowances, and payment method
- Working hours and rest time
- Social insurance obligations
- Training terms (if applicable)
- Termination conditions
Missing clauses can make parts of the contract unenforceable.
Salary Structure & Contract Language
Salary Must Be:
- Stated as gross salary
- Paid in Vietnamese Dong (VND)
- Clearly broken down if allowances apply
📌 Paying “net salary” without proper gross-up calculations is a common mistake.
Working Hours & Overtime Clauses
Contracts must align with statutory limits:
- Max 8 hours/day
- Max 48 hours/week
- Overtime requires employee consent
- Overtime must be paid at premium rates
Any clause contradicting statutory rules is invalid.
Termination Clauses: What You Can (and Can’t) Include
Vietnam does not allow at-will termination.
Termination Must:
- Be based on legal grounds
- Follow notice periods
- Comply with procedure
Clauses that allow unilateral termination “at discretion” are not enforceable, even if signed.
Common Contract Mistakes Foreign Companies Make
❌ Using overseas employment templates
❌ Drafting contracts only in English
❌ Unlimited fixed-term renewals
❌ Incorrect probation periods
❌ Missing termination procedures
❌ Net salary clauses without tax clarity
These mistakes often surface only when a dispute occurs.
Employment Contracts When Hiring via Employer of Record (EOR)
When using an EOR:
- The EOR signs the employment contract
- Contracts are drafted fully compliant with Vietnamese law
- Probation, salary, insurance, and termination are aligned legally
- You control the role and performance—not the legal contract risk
This is the safest approach for foreign companies without a Vietnam entity.
When Contracts Should Be Updated or Amended
Contracts must be amended when:
- Salary changes
- Role or responsibilities change
- Working location changes
- Contract term changes
Amendments must be written and signed—informal changes are not valid.
2026 Employment Contract Compliance Checklist
✔ Correct contract type
✔ Vietnamese-compliant language
✔ Proper probation terms
✔ Gross salary clarity
✔ Insurance obligations stated
✔ Lawful termination clauses
✔ Signed before employment starts
How BusinessPartner.vn Helps You Stay Contract-Compliant
BusinessPartner.vn supports foreign employers with:
- Vietnam-compliant employment contracts
- Employer of Record hiring solutions
- Payroll and labor law alignment
- Risk-managed probation and termination
- Seamless transition from EOR to entity
👉 Speak with our Vietnam hiring experts to review or structure your employment contracts.
Employer of Record (EOR) in Vietnam: Complete Guide
How to Hire Employees in Vietnam Without an Entity
EOR vs Company Setup in Vietnam
Cost of Hiring Employees in Vietnam
