The Labor Code 2019, effective on January 1, 2021 contains many new regulations governing the labor relationship between the employee and the employer

1. Clarify more about labor contracts

Pursuant to Clause 1, Article 13 of the Labor Code 2019, a labor contract is established when having the following factors:

• There is an agreement between the employee and the employer;
• Wages and salaries paid;
• There is the management, administration and supervision of a party.

The Labor Code also clearly stipulates: Even if the contract is shown with a different name other than “Labor contract”, but has the content shown above, it is still considered a labor contract.

2. There are 2 types of labor contracts

Clause 1, Article 20 of the Labor Code 2019 annulled the labor contract for seasonal or a certain job with a term of less than 12 months, under which, the labor contract has 2 types:

• An indefinite term labor contract;
• A fixed-term labor contract, in which the time of termination of the validity of the contract is not more than 36 months from the effective time of the contract.

3. Recognition of electronic labor contracts

The Labor Code 2019 continues to affirm that the labor contract must be concluded in writing. In addition, more specific provisions on the form of signing via electronic means are also considered as documents in Clause 1, Article 14.

4. Labor contracts of less than 01 month are not applicable to probation

The Labor Code 2019 removed the seasonal labor contract, so according to Clause 3 Article 24, employee may not to be required to probation if he/she enters into a labor contract of less than 01 month.

5. Probationary period of the enterprise manager prescribed by the Law on Enterprises

Clause 1 Article 25 of the Labor Code 2019 added the probationary period for employees who are enterprise manager as follows:

No more than 180 days for the job of the enterprise manager according to the provisions of the Law on Enterprises,  the Law on management and use of state investment in enterprises.

6. The employee has the right to unilaterally terminate the labor contract without any reason

The 2012 Labor Code stipulates that employees working under fixed-term labor contracts have the right to unilaterally terminate the labor contract in certain cases, and at least 30 days in advance.

Clause 1, Article 35 of the 2019 Labor Code allows employees working under fixed-term labor contracts to unilaterally terminate their labor contracts without reasons, only requiring a prior notice period.

7. The employee has the right to unilaterally terminate the contract without prior notice

Pursuant to Clause 2, Article 35 of the 2019 Labor Code, the employee has the right to unilaterally terminate the labor contract without prior notice in the following cases:

a) Is not assigned to the correct job or working place or not provided working conditions, except for the case specified in Article 29 of this Code;

b) The employee is not paid in full or on time, except for the case in Clause 4 Article 97 of this Code;

c) The employer is mistreated, beaten, or verbally abusive, acts affecting health, dignity or honor; forced labor;

d) Being sexually harassed at the workplace;

đ) The pregnant female employee must take leave as prescribed in Clause 1 Article 138 of this Code;

e) To reach the retirement age as prescribed in Article 169 of this Code, unless otherwise agreed by the parties;

g) The employer provides dishonest information as prescribed in Clause 1 Article 16 of this Code, affecting the performance of the labor contract.

8. There are 3 additional cases in which the employer is entitled to unilaterally terminate the labor contract

Clause 1, Article 36 of the Labor Code 2019 added 3 cases where the employer is entitled to unilaterally terminate the labor contract as follows:

• The employee reaches the full retirement age as prescribed in Article 169 of this Code, unless otherwise agreed;
• Employees quit their jobs without plausible reasons for 05 or more consecutive working days;
• The employee provides untruthful information as prescribed in Clause 2, Article 16 of this Code when entering into a labor contract affecting the recruitment of employees.

9. The employer has the right to unilaterally terminate the labor contract without prior notice

Pursuant to Article 36 of the Labor Code 2019, the employer has the right to unilaterally terminate the labor contract without prior notice in the following 2 cases:

• The employee is not present at the workplace after the time limit specified in Article 31 of this Code;
• The employee voluntarily quit his job without having a plausible reason for 05 or more consecutive working days.

10. Increase the payment term of the payments upon termination of the labor contract

Labor Code 2012 stipulates that within 07 working days from the date of termination of the labor contract, the two parties are responsible for paying all amounts related to the interests of each party; In exceptional circumstances, it can be extended but not more than 30 days.

Clause 1, Article 48 of the Labor Code 2019 increased the time limit to 14 days for the parties to pay the amounts related to the benefits of each party, and clarify the specific cases that could be extended as follows:

Within 14 working days from the date of termination of the labor contract, the two parties are responsible for paying the full amount related to the interests of each party, unless the following can be extended but not for more than 30 days:

a) The employer who is not an individual terminates its operation;

b) The employer changes structure, technology or due to economic reasons;

c) Division, separation, consolidation or merger; sale, lease, and conversion of business type; transfer of ownership, right to use property of the enterprise or cooperative;

d) Due to a natural disaster, fire, enemy sabotage or dangerous epidemic