Vietnam: 03 questions to be considered before unilaterally terminating a labor contract of an employee who regularly fails to complete assigned work?

unilaterally terminating a labor contract

During the period of using labor, an employer sometimes wishes to terminate a labor contract before the term ends with an employee for the reason that the employee has failed to complete the assigned work. However, what are the requirements set forth by Vietnamese laws for the employer to properly exercise its right?

By 03 below questions, BLawyers Vietnam will present some notes about the unilateral termination of labor contracts due to the frequent non-completion of work from employees, according to the prevailing laws of Vietnam.

1. The first question: What is the basis for the employer to terminate a labor contract with an employee with the reason that the employee has regularly failed to complete his/her work?

Pursuant to Labor Code 2019, an employer has the right to unilaterally terminate a labor contract with an employee if the employee has frequently failed to complete the work specified in a labor contract and if the employer has grounds to determine that the employee “frequently fails to complete assigned work” based on the criteria for assessing the level of work completion specified in a regulation that has been issued by the employer.

Thus, to exercise its right to unilaterally terminate a labor contract due to the frequent non-completion of work from an employee, the employer needs to consider the following questions:

(i) Has the employer issued a regulation that includes criteria for assessing the level of work completion? When issuing this regulation, did the employer consult with a grassroots-level representative organization of employees?

In addition, has the employer publicized and disseminated to its employees its regulation on assessment of work completion?

(ii) For acts of not completing an assigned work by an employee, has the employer compared such acts with the criteria set out in its regulation to determine whether the employee’s behavior is considered “frequent non-completion of work”?

(iii) Has the employer held a dialogue meeting at the workplace to discuss the unilateral termination of the labor contract due to the frequent non-completion of work from that employee?

2. The second question: What are the obligations of the employer when unilaterally terminating a labor contract for the reason that the employee has frequently failed to complete the work?

If it has enough grounds to determine that the employee has frequently failed to complete the work, the employer has the right to unilaterally terminate the labor contract but must notify the employee in advance with the following terms:

(i) At least 45 days in advance for an indefinite term labor contract;

(ii) At least 30 days in advance for a definite-term labor contract with a term of 12 to 36 months; and

(iii) At least 03 working days in advance for a definite-term labor contract with a term of less than 12 months.

If the employee is working in specific industries, occupations or jobs, the term to give notice in advance may be shorter than the terms mentioned above.

3. The third question: In which cases is the employer not allowed to exercise the right to unilaterally terminate a labor contract?

The employer needs to check whether:

(i) The employee is suffering from an illness, work accident, or occupational disease, and is being treated or nursed under the decision of a competent health institution;

(ii) The employee is on annual leave, personal leave, or any other type of leave permitted by the employer;

(iii) The employee is pregnant, on maternal leave, or raising a child under 12 months of age.

If the employer has considered and had clear answers for the three questions above, a risk of dispute is less likely to occur.

The above is not official advice from BLawyers Vietnam. If you have any questions or suggestions about the above, please contact us at consult@blawyersvn.com. We would love to hear from you.

Date: 24 August 2023

Writer: Trinh Nguyen

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