What are legal risks if expats work in Vietnam without a work permit and ways to mitigate the risks?

 Date: 24 September 2021

Writers: Huy Nguyen

Currently, there is a situation of expats coming to work permanently in Vietnam but not having work permits, or entering Vietnam with various types of visas to work and extending such visas many times. In addition, expats also moved their family and personal belongings to Vietnam and paid hundreds of fees/ costs. So, how do Vietnamese laws regulate this situation? What legal risks can expats face? Through this article, BLawyers Vietnam will help readers answer the above questions.

1. Legal risks when expats work in Vietnam without work permits

a. Firstly, the Vietnamese laws do not recognize the labor relation between parties

The Vietnamese laws clearly stipulate the following cases where expats are exempted from work permits to work in Vietnam:

  1. Being the owner or capital contributor of a limited liability company with a capital contribution value of at least VND 3 billion;
  2. Being the Chairperson or a member of the Board of Directors of a joint-stock company with a capital contribution value of at least VND 3 billion;
  3. Entering Vietnam to hold the position of a manager, executive, an expert, or a technical worker for a period of work of fewer than 30 days and up to 3 times a year; or
  4. Other cases provided by laws.

Therefore, other than the above cases, the employer and the expat are responsible for obtaining a work permit before the expat works in Vietnam.

In addition, the employer and the expat can only enter a labor contract after obtaining a work permit. Therefore, when the expat engages in a labor contract with the employer without a work permit, such a labor contract is considered illegal. At this time, as stated above, the Vietnamese laws do not recognize this labor relation. This leads rights and interests of the expat to be not protected when the employer violates provisions of the labor contract.

b. Secondly, the expat can be deported out of Vietnam

According to the laws, in addition to being imposed a fine of up to VND25,000,000, the expat can also face a supplemental fine which is deported out of Vietnam for working in Vietnam without a work permit or without written confirmations of their exemption from work permit requirements.

c. Thirdly, the expat can face disadvantages during litigation for settlement of the dispute with the employer

When there is a dispute arising from a labor contract that is not based on the work permit, the expat may receive unfavorable judgments from the Court. For example, when the employer illegally unilaterally terminates the labor contract and the expat files a lawsuit requesting the employer to pay severance allowance and performing other obligations as prescribed by laws, the Court may refuse those requests with the reason that the expat has worked in Vietnam without a work permit.

2. How to limit legal risks when the expat works in Vietnam?

The answer is that the expat before entering Vietnam to work should carefully study the Vietnamese laws. To-be-searched issues include (and you can consider our 31 FQAs about expats working in Vietnam):

  1. Is the expat subject to cases of obtaining a work permit before entering Vietnam to work? If yes, what dossiers does the expat need to prepare to get such a document? Is there any possibility that the competent authority refuses/ delays the issuance of the work permit to the expat?;
  2. What are the process and timeline for obtaining a work permit? What are the obligations of the employer and the expat in obtaining a work permit? How to handle it in the case of not being able to obtain a work permit for the expat?;
  3. Must the employer renew the work permit when it is expiry? Expats need to research the duration of the work permit and the employer’s obligations to renew the work permit when it expires. The purpose is to consider the risks related to costs of moving family and personal belongings to Vietnam; and
  4. The amounts that the expat can receive if there would be a dispute with the employer about the signed labor contract.

Should you have any questions about the above contents, please revert to BLawyers Vietnam at consult@blawyersvn.com. We are more than happy to hear from you!

Maybe you want to read:

31 FQAs about expats working in Vietnam

Updated: How is illegal one-sided termination of labor contracts by employers pursuant to the law of Vietnam?

4 notable changes to new labor laws of Vietnam

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