Who Issues Work Permits for Foreigners in Industrial Zones?

1. Vietnamese Labor Laws and Regulations

Vietnam is constantly refining its labor laws and policies due to its more open investment environment, which facilitates integration with global corporate practices. 
Vietnam enacted a revised Labor Code in this regard, and it went into effect in January 2021. The International Labor Organization (ILO) has stated that the labor regulations' revision is a step in bringing Vietnam into compliance with international labor norms, especially as it becomes more integrated into the global economy.

Businesses operating in Vietnam need to make sure they abide by the Labor Code's regulations, which set forth the rights and obligations of both employers and workers with regard to, among other things, working hours, labor agreements, social insurance, overtime, strikes, and contract termination. 

Employment contracts

A labor contract must contain provisions such as the scope of work, working hours, rest breaks, wages, job location, terms of the contract, occupational safety and hygiene conditions, and social insurance.

There are two types of labor contracts in Vietnam: 

• Indefinite term: A contract in which two parties do not determine the term and the time for its termination.
• Definite term: Two parties determine the term as a period not exceeding 36 months and the time for its termination. The definite contract can only be renewed once.

Full-time and part-time labor contracts have identical obligations and rights.

Companies that employ ten or more people must have a copy of company rules or internal labor regulations registered with the provincial labor department. This includes the company policy pertaining to working and rest hours, rules and orders in the company, labor safety, hygiene in the workplace, protection of assets, business and technology confidentiality, and sanction methods.

Working hours

The working hour limit is 48 hours per week; the labor code states that normal working hours cannot exceed eight hours a day or 48 hours per week. However, if the employer and employee agree on an overtime deal, the overtime cannot exceed 12 hours a day, 40 hours a month, and 200 hours a year.

• However, according to Resolution No. 17/2022/UBTVQH15, if the employer and employee agree on an overtime deal, employers are permitted to assign their employees to work overtime for over 200 hours but not exceeding 300 hours per year, except in the following cases:
• Employees aged between 15 and under 18;
• Employees having mild disabilities with work capacity reduction of at least 51% or employees with severe disabilities or extremely severe disabilities;
• Employees doing arduous, hazardous, dangerous or extremely arduous, hazardous or dangerous work;
• Female employees in their 7th month of pregnancy onward (or the 6th month of pregnancy onward in case they work in the highlands, remote areas, bordering areas, or islands);
• Female employees nursing children aged under 12 months.

For industries such as textile and clothing, footwear, and electronics, in which seasonal orders during certain times of the year require an extensive workload, an overtime cap of 300 hours has been specified.

For employees working in heavy or hazardous conditions, the law stipulates that employers are responsible for limiting their working limit due to exposure to dangerous substances or chemicals as per the national technical regulations and relevant laws.

Minimum wages

There are two kinds of minimum wages in Vietnam. The first type is the common minimum wage of VND 2,340,000 (~US$93), which is used to calculate salaries for employees in state-owned organizations and enterprises, as well as to calculate the social contribution for all enterprises (i.e., the maximum social contribution is 20 times the common minimum wage).

The second type of minimum wage is used for employees in all non-state enterprises based on zones as defined by the government. (Please note that the exchange rate on June 26, 2024, was VND 25,250.)

2. Industrial Zone Authorities

According to Article 30 of Decree 152/2020/ND-CP, as supplemented by Article 72 of Decree 35/2022/ND-CP, management boards of industrial zones and economic zones have the following important responsibilities regarding workers in these areas:

• Issuing work permits: Issuing, renewing, extending, and revoking work permits for workers, as well as verifying for foreign workers who do not require special work permits when working in industrial zones or economic zones.
• Enforcing labor regulations: Organizing and supervising the enforcement of labor regulations, ensuring that labor regulations and provisions are implemented fairly and correctly.
• Evaluating training: Receiving and evaluating reports on the results of training activities to improve the skills of workers in industrial zones and economic zones annually.
• Overseeing overtime: Receiving notifications and monitoring overtime activities of enterprises in the zone, especially when overtime exceeds 200 to 300 hours in a year. This is to ensure that overtime is organized and implemented in accordance with regulations and to protect the rights and health of workers.

Furthermore, Clause a, Clause 6a of Article 30 of Decree 152/2020/ND-CP dated December 30, 2020, has undergone significant changes with the emergence of Decree 35/2022/ND-CP dated May 28, 2022. This contains new regulations related to the management of industrial zones and economic zones. These amendments not only affect the handling of foreign workers working in Vietnam but also delve into the recruitment and management process of Vietnamese workers working for foreign organizations and individuals in Vietnamese territory.

In Summary

From these recent policy changes and adjustments, the role of the management board of industrial zones and economic zones is becoming clearer. Specifically, the power to manage the use of foreign labor by enterprises is gradually being transferred. This means that the management board of industrial zones and economic zones will no longer be directly responsible for this. However, it does not mean that they no longer have an important role in supervising and supporting enterprises regarding labor regulations and standards, ensuring a fair and safe working environment for all workers, including foreign workers.

The management board of industrial zones will no longer be involved in issuing work permits for foreign workers working in industrial zones according to the new regulations. Instead, the new changes seem to be gradually transferring this responsibility to other agencies or organizations. However, the management board of industrial zones still plays an important role in ensuring that enterprises comply with labor regulations and a safe working environment, not only for foreign workers but also for all employees in the industrial zone.

3. Work Permit Issuance Procedures

Obtaining a work permit in Vietnam is crucial for foreign workers to legally reside and work in the country.

The process involves several steps and requires preparation from both the employer and the foreign employee. This article outlines the key stages and documents needed for a smooth application.  

Step 1: Employer Initiates Demand for Foreign Workers

The employer must kickstart the process by submitting an application for approval of hiring foreign workers at least 15 days before the expected start date of the foreign employee. This application, along with a certified copy of the business registration and a letter of attorney (if applicable), is submitted to the Department of Labor, War Invalids and Social Affairs (DOLISA) where the foreign worker will be employed. Alternatively, it can be done electronically through the National Public Service Portal.  

Step 2: Prepare Work Permit Documents

Upon receiving approval for hiring foreign workers, the employer needs to gather the following documents for the work permit application:

• Application form: Completed Vietnam work permit application form (Form No. 11/PLI)  
• Health and police checks: Original health check issued in Vietnam (or legalized if issued abroad) with a certified Vietnamese translation (valid within the last 12 months). Likewise, an original Vietnam Police Check (or legalized if issued abroad) with a certified Vietnamese translation (not older than 6 months).  
• Passport and approval letter: A certified copy of the valid passport and the approval letter obtained in Step 1.
• Photographs: Two recent passport-sized photos (4 x 6 cm) meeting the specified photo requirements.  
• Foreigner's qualifications: Legalized documents proving the foreign worker's qualifications and eligibility for the applied position, along with certified Vietnamese translations.

Step 3: Submit Work Permit Application

At least 15 days prior to the anticipated start date, the employer submits the prepared documentation electronically to either MOLISA or the relevant provincial DOLISA. Upon receiving notification of the results through the system, the applicant must present the original documents for verification and collect the official approval letter.  

Processing Timeline and Costs

The entire process, from submitting the initial application to receiving the work permit, takes about 1.5 to 2 months. This includes:

• Recruitment announcement: A 15-day period for advertising the position on the Ministry of Labor website or relevant Employment Service Center website.  
• Explanation report: A minimum 15-day waiting period for the competent authority to respond to an explanation report submitted by the employer.
• Work permit application: 15 working days for processing the work permit application after receiving all required documents.

Important Note: It's highly recommended to initiate the process well in advance (at least 1.5-2 months) before the expected start date to account for any unforeseen delays.

Work Permit Fees:

The cost of a Vietnamese work permit varies depending on the type of issuance:

• Issuance of a new work permit: VND 600,000 per license
• Re-issuance of an existing work permit: VND 450,000 per license
• Extension of an existing work permit: VND 450,000 per license

In Summary

Obtaining a work permit in Vietnam requires careful planning and adherence to specific procedures. By understanding the various steps, necessary documents, and processing times, employers can ensure a smooth and efficient experience for both themselves and their foreign employees.  

4. Specific Requirements for Industrial Zone Workers

Foreign workers seeking employment in Vietnamese industrial zones must meet certain specific requirements to obtain a work permit. These requirements may vary depending on the industry, job position, and individual circumstances.

Industry-Specific Qualifications:

• Technical Skills: Depending on the industry, foreign workers may need to possess specific technical skills or certifications. For example, engineers in manufacturing industries may require relevant engineering degrees or certifications.
• Industry Experience: Experience in the relevant industry can be a valuable asset, demonstrating the foreign worker's knowledge and capabilities.

Language Proficiency:

• Vietnamese or English: Proficiency in Vietnamese or English is often a requirement for foreign workers in Vietnamese industrial zones. This enables effective communication with colleagues, supervisors, and clients.
• Language Certifications: Foreign workers may need to provide language proficiency certificates, such as TOEFL or IELTS, to demonstrate their language skills.

Additional Documentation:

• Health Certificates: Foreign workers may need to provide a health certificate to ensure they are free from communicable diseases.
• Police Clearance Certificates: A police clearance certificate may be required to verify the worker's criminal record.
• Other Permits: Depending on the specific industry or job role, additional permits or licenses may be necessary.

It's important for foreign workers to thoroughly research the specific requirements for their desired industry and job position to ensure they have the necessary qualifications and documentation.

5. Timeline and Processing Fees

Estimated Processing Time:

The processing time for work permit applications in Vietnam can vary depending on several factors, including:

• Completeness of Documents: Ensuring that all required documents are submitted correctly and in a timely manner can expedite the process.
• Workload of Authorities: The workload of the relevant government agencies may also influence the processing time.
• Peak Seasons: During peak seasons or periods of high demand, processing times may be longer.

Generally, the estimated processing time for a work permit application is around 1-2 months. However, it's advisable to allow for a longer timeframe to account for potential delays.

Fees Associated with Work Permits:

There are associated fees for obtaining a work permit in Vietnam. These fees may vary depending on the specific requirements and the type of work permit. Some potential fees include:

• Application Fees: Fees for submitting the work permit application.
• Government Processing Fees: Fees charged by the government for processing the application.
• Health Check Fees: Fees for medical examinations required for the work permit application.

It's important to inquire about the specific fees and payment methods with the relevant government authorities or your employer.

Potential Delays and Challenges:

• Administrative Procedures: Administrative delays or inefficiencies can sometimes cause delays in the work permit process.
• Documentation Issues: Incomplete or inaccurate documentation may require additional time for verification and correction.
• Quota Restrictions: In certain industries or regions, there may be quotas or restrictions on the number of foreign workers allowed.

To minimize delays and challenges, it's recommended to submit your work permit application well in advance of your intended start date and to ensure that all required documents are complete and accurate.

6. Appeals and Grievances

Denial or Restrictions:

If a work permit application is denied or subject to restrictions, foreign workers may have the right to appeal the decision. The specific procedures for appealing a work permit decision may vary depending on the circumstances and the relevant government agency.

Labor Unions:

Labor unions can provide valuable support and assistance to foreign workers who are facing difficulties with their work permits or other labor-related issues. Unions can help workers understand their rights, file grievances, and negotiate with employers or government officials.

Legal Representation:

In some cases, foreign workers may consider seeking legal representation to navigate the appeals process or to address complex labor disputes. Legal professionals can provide guidance and advocate for the worker's rights.

Important Considerations:

• Time Limits: There may be time limits for filing appeals, so it's important to act promptly if your work permit application is denied or restricted.
• Evidence: To support your appeal, you may need to provide additional evidence or documentation to demonstrate the validity of your claim.
• Due Process: Ensure that the appeals process is fair and transparent and that your rights are being respected.

By understanding the available avenues for appeals and grievances, foreign workers can protect their rights and seek redress if they face challenges with their work permits.

7. Importance of Work Permits

Legal Status:

• Authorization to Work: A valid work permit is essential for foreign workers to have legal status in Vietnam and to work legally.
• Avoidance of Penalties: Working without a valid work permit can result in fines, deportation, or other legal consequences.

Benefits:

• Access to Services: Work permits entitle foreign workers to access certain benefits, such as healthcare, social security, and other government services.
• Labor Rights Protection: Having a work permit provides a degree of protection for foreign workers' labor rights, including the right to fair wages, working conditions, and dispute resolution mechanisms.
• Visa Extensions: Work permits may allow for extensions of your stay in Vietnam, making it easier to renew your visa and continue working.

Consequences of Working Without a Permit:

• Legal Penalties: Working without a valid work permit can result in fines, deportation, and potential legal action.
• Limited Rights: Foreign workers who work illegally may not have the same rights and protections as those with valid work permits.
• Employment Challenges: Working without a permit can make it difficult to find employment in the future and may damage your reputation.

In conclusion, obtaining a valid work permit is crucial for foreign workers in Vietnam to ensure legal status, access benefits, and protect their labor rights. By understanding the importance of work permits and complying with the relevant regulations, foreign workers can minimize risks and maximize their opportunities in the Vietnamese job market.

8. Conclusion