Headlines 18/11/2020 14:26 CH

From 2021, the following contracts are defined as labor contracts

Quý Nguyễn

2019 Labor Code (in force from January 1, 2021) sets out new regulations, especially the one regarding the determination of labor contracts.

Specific regulations prescribe that, if contracts that contracting parties agree to call by other names (e.g. collaborator contracts,...) meet 02 following conditions, they will be classified as labor contracts:

(1) Each contract must contain clauses on occupations for which wages or salaries are paid.

(2) Each contract must be put under a contracting party's management, administration or supervision.

“From January 1, 2021, as for contracts called by other names, but defined as labor contracts, workers/employees and enterprises need to pay attention to observing relevant regulations, such as compulsory social insurance contributions which are binding terms and conditions of labor contracts having the term of 01 month to under 03 months”, said Mr. Bui Tuong Vu, Lawyer and Director of THU VIEN PHAP LUAT

In addition to what is stated above, the 2019 Labor Code adds several new regulations regarding labor contracts in effect from 2021, including:

- Additional regulations on the probation term

Each probation term may last for the maximum duration of 180 days with regard to employees hired to hold executive positions as provided in the Law on Enterprises, the Law on Management and Use of State Capital Invested in Enterprises.

- Additional regulations on temporary suspension from execution of labor contracts

More workers or employees falling in the following cases may be granted permission for a postponement of execution of labor contracts:

+ Workers or employees are called up for militia or self-defence services;

- Workers or employees are authorized to implement rights and responsibilities on behalf of their employers to their shares of capital invested in other enterprises.

- Workers or employees may unilaterally terminate their contracts without cause

+ Pursuant to the 2012 Labor Code, if any worker or employee entering into a fixed-term employment contract wishes to unilaterally terminate his/her labor contract, he/she must have one of the causes provided in clause 1 of Article 37 in the 2012 Labor Code, and meet requirements concerning prior notice period.

+ In the 2019 Labor Code, any worker or employee may unilaterally terminate an employment contract without cause provided that he/she meets requirements concerning prior notice period as prescribed in clause 1 of Article 35 (except in cases where prior notice is not required).

- Exemption from the probation requirement for any labor contract of which the term is less than 1 month will be granted.

According to existing regulations, only workers or employees signing seasonal labor contracts are exempted from the probation requirement by default.  From 2021, exemption from the probation requirement for any labor contract of which the term is less than 1 month will be granted.

- Labor contracts made by electronic means as data messages will be accepted.

Labor contracts concluded via electronic devices as data messages under laws on electronic transactions have the same value as written contracts.

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