Work Permit Disputes in Vietnam: A Foreign Employee's Guide

The principal source of work-permit law for foreign employees is Decree 152/2020/ND-CP (and amending Decree 70/2023/ND-CP), regulating foreign workers in Vietnam. The Decree implements provisions of the Labour Code 2019 and is supplemented by guidance from the Ministry of Labour, Invalids and Social Affairs (MOLISA).

Who needs a work permit: foreign nationals working for a Vietnamese employer for more than 30 cumulative days in a year, or carrying out specified categories of activity that require permit irrespective of duration (managerial roles, technical experts, etc.). The categories of permitted foreign employee are defined: experts, executives, managers, and technical workers. Each category has specific qualification requirements (years of relevant experience, educational qualifications, employer justification of the need for a foreign rather than Vietnamese employee).

The application process: the employer initiates the application (with the foreign employee's document package), MOLISA or the relevant provincial Department of Labour approves the position-and-employee combination, and a permit issues for a maximum two-year term, renewable. Renewal applications follow similar procedures and are typically filed in advance of expiry.

Documentation: the foreign employee provides educational certificates, work-experience evidence, criminal-record check (Vietnamese and home-country), health certificate, and identity documents — all typically apostilled or legalised and translated. The employer provides justification of the position and employment terms. The full document package is prepared with care; defects in documentation are the most common cause of application delay or refusal.

Some foreign workers are exempt from the work-permit requirement under Article 7 of Decree 152/2020. Common exempt categories include: managers or owners of capital contributors of an LLC or JSC; the chief representative of a foreign organisation in Vietnam; foreigners married to Vietnamese citizens and residing in Vietnam (in some cases); intra-company transfers within the eleven service sectors specified under WTO commitments (subject to conditions); foreign lawyers practising in foreign-law-firm representative offices; and several other narrowly defined categories.

Confirmation procedures: even exempt workers typically need formal confirmation of exemption from MOLISA before commencing work, on application by the employer. The confirmation is not a permit but functionally similar — it must be obtained before work starts, it ties to the specific position, and it must be renewed or amended on changes.

Strategic implications: the exemption categories matter for two reasons. First, they can simplify the path for senior foreign employees and capital contributors who would otherwise face the full work-permit process. Second, they affect what happens if the underlying basis changes — an exempt manager who ceases to be a manager loses the exemption and must obtain a work permit (or leave). Foreign workers should know which category they fall into and what triggers a category change.

Common errors I see: foreign capital contributors assuming their visa-free entry rights cover work — they do not, work always requires either a permit or a confirmed exemption; foreign spouses of Vietnamese citizens assuming the marriage automatically permits work — it does not in all cases; representative-office staff assuming they can shift to LLC roles without a new permit — they cannot.

A Vietnamese work permit is tied to a specific employer, specific position, and (in many cases) specific work location. The permit does not authorise the holder to work generally — it authorises a defined work relationship. Changes in any of these elements typically require permit amendment or, in some cases, a new permit application.

Implications for the employee: if the employment ends, the work permit's purpose ceases. The permit itself remains technically issued for the original term, but the right to work under it ends with the employment relationship. The Decree requires the employer to notify MOLISA of permit revocation, and immigration authorities are alerted.

Implications for changing employers: moving from one Vietnamese employer to another is not a simple administrative change. The new employer initiates a new work-permit application for the new position, with the same documentation and approval process as the original. This can take 30-60 days. During the gap between the old and new permits, the foreign worker is technically not authorised to work — and depending on visa status, may not be authorised to remain.

Implications for promotion or role change within the same employer: changes in title, scope, or responsibility may require permit amendment. Moving from a technical role to a managerial role, or from an executive role to a different function, are typical triggers. Employers and employees should consult before making changes that affect the position description on the permit.

Termination of employment — whether by resignation, dismissal, mutual agreement, or expiry of fixed-term contract — has cascading consequences for foreign employees that often surprise those who have not faced the situation before.

The work permit: ceases to authorise work on termination of the underlying employment. The employer is required to return the permit to the issuing authority within a specified period (typically 15 days under current rules) and notify MOLISA of the termination. The employee retains the physical permit document until that point but cannot lawfully work under it.

The temporary residence card (TRC): if the foreign employee held a TRC linked to employment, the TRC's basis ends with the employment. Practical consequence: the TRC may be cancelled, or its expiry brought forward, requiring the foreign worker to either obtain a new basis (new employer's permit, new investment, marriage to Vietnamese citizen, etc.) or depart.

Severance and statutory protections: Vietnamese labour law provides protections for foreign employees similar to (though not identical to) Vietnamese employees. Unilateral termination by the employer must be on grounds permitted under the Labour Code, with required notice or payment in lieu. Severance allowance applies in defined cases. Where dismissal is alleged to be unlawful (without proper grounds, without proper procedure, or in breach of contract), the foreign employee has standing to challenge through the dispute paths discussed below — though the procedural realities (immigration status, ability to remain in Vietnam during the dispute) need careful planning.

Final settlements: at termination, foreign employees are entitled to: payment of all earned wages and unused annual leave; severance allowance if applicable (typically half a month's wages per year of service); refund of social-insurance contributions in some cases (with home-country tax considerations); return of personal belongings; references and confirmation of employment in the form required by the home country. Disputes commonly arise about the calculation of these elements; documenting the terms in the employment contract is the best protection.

The practical immigration cascade is what most foreign employees underestimate. The sequence is typically: termination of employment → revocation or expiry of work-permit basis → cancellation or expiry of TRC → loss of legal residence basis → required departure or change of basis.

The available timeframes are short. Once the work permit's basis has ended, the TRC may be cancelled within weeks. There is no statutory grace period in the law for foreign employees to remain in Vietnam to seek new employment — though in practice, regularised exit-permit procedures or short-term tourist-visa conversions can buy time. Foreign workers facing termination should plan immigration steps simultaneously with employment-dispute steps, not sequentially.

Alternative bases for remaining: include securing new employment (new employer's work-permit application, with bridging arrangements); investment-based residence (capital contribution to a Vietnamese company); marriage to a Vietnamese citizen with appropriate documentation; long-term tourist or business visa renewals (limited and not a long-term solution). Each has its own timeline and documentation requirements.

Penalties for unauthorised work or overstay: working without a permit attracts administrative penalties (fines for both employer and employee) and possible deportation. Overstaying visa or TRC validity attracts fines and can compromise re-entry. These consequences are administrative rather than criminal in most cases, but the deportation and re-entry consequences can be lasting.

Foreign employees who consider their termination unlawful, or who have substantial unpaid claims (wages, severance, bonus), have several dispute paths under Vietnamese law.

Administrative complaint to MOLISA or the provincial Department of Labour. Where the dispute concerns work-permit issues, employment law violations, or social-insurance compliance, the labour authorities have inspection and mediation jurisdiction. This path is relatively informal, fast (days to weeks), and can resolve clear-cut violations without litigation. It is well-suited to disputes about unpaid wages, missing work-permit obligations, and administrative compliance.

Labour conciliation. Article 188 of the Labour Code 2019 provides for labour conciliation through provincial labour mediators as an initial step for individual labour disputes. Conciliation is generally a precondition to court action for individual disputes (with limited exceptions for unilateral termination disputes). The conciliation process is brief — typically 5 working days from referral — and aims at settlement; if conciliation fails, the dispute can move to the People's Court.

Civil court. The District People's Court (or Provincial People's Court for matters with foreign elements) has jurisdiction over individual employment disputes. Standard timelines: 4-6 months at first instance, longer for complex matters. The court applies the Labour Code and the parties' employment contract. Foreign-element matters allocate to the Provincial People's Court and follow the procedures of the Civil Procedure Code 2015. Court fees are modest by international standards.

Arbitration. Some employment contracts (typically senior or expatriate contracts) provide for arbitration of disputes. Arbitration is permissible for individual labour disputes under specified conditions and is sometimes faster and more confidential than court. VIAC handles employment-related arbitration with experienced panellists.

Practical sequencing: for most foreign-employee disputes, the practical sequence is to file an administrative complaint and conciliation simultaneously, attempt settlement, and proceed to court only if settlement is not achievable. Most cases settle before trial when both sides are well-advised; a small minority require full proceedings.

The worst-case scenario for a foreign employee is termination combined with a short timeline to depart, unpaid claims, and limited leverage. Planning for this — even briefly, before it happens — substantially reduces the risk and improves outcomes.

Documentation discipline. Keep clear copies of: signed employment contract; work permit and any amendments; TRC; pay slips and bonus-payment records; tax-payment records; social-insurance contribution records; appraisals and disciplinary records (if any); all written communications with the employer that bear on terms or performance. Keep these in a location accessible from outside the workplace (cloud storage, home).

Emergency contacts and counsel. Maintain the contact details of an employment lawyer who can act on short notice. The first 24-48 hours after a sudden termination are when key procedural steps (objection to dismissal procedure, preservation of immigration status, documentation requests) need to happen.

Financial cushion. Maintain savings sufficient for at least 3-6 months of living expenses outside the immediate paycheck, particularly if you are sponsoring a TRC and dependents. The financial pressure of a sudden termination can force decisions (accept inadequate severance, depart prematurely) that are not in the long-term interest.

Negotiation leverage. The strongest negotiating position is created by being right on the law and being prepared to enforce. Where unilateral termination is not properly grounded, where notice is inadequate, where severance is short, or where unpaid claims are clear, well-prepared assertion through counsel often produces meaningful improvement in the settlement before any formal dispute filing. Employers prefer to resolve clean disputes; they fight ones that are unclear or where counsel is uninformed.

Departure on agreed terms vs. deportation. Where remaining in Vietnam is not feasible, departure on regularised terms (resignation accepted, exit permits issued, no unpaid administrative penalties) preserves re-entry options. Departure under deportation order, or with unresolved administrative penalties, can create lasting consequences. Where the underlying dispute is not fully resolvable in the available timeframe, structured departure with claims preserved (under arbitration agreement or otherwise) is often the right answer.