Tiếng Việt
中文 (中国)
日本語
(Vietnam) In the working world, there are many cases in which there is no official labor contract between the employer and the employee. This happens in many circumstances, for example, when the employee is on a part-time job, a probationary period, a freelance contract, illegal working in a foreign country, and/or in circumstances in which the employer doesn’t want to pay the employee their rightfully rights and interests. So, what are the difference between these ‘oral’ labor relations and official labor contracts in Vietnam?
First of all, the term ‘oral’ here means anything that is not strictly stipulated in a document, approved and signed by related parties, not just the basic definition of a mouth-to-ear contract.
The ‘oral’ labor relations can be, indeed, an oral contract, or some unofficial agreement by both parties such as through hand-written piece of paper, messages through Zalo, Facebook, etc.
In reality, most ‘oral’ labor relations are meaningless because they are just words spoken or unofficially written between the parties with no actual evidence that there have been such agreements.
Accordingly, when a party wants, they can deny that such agreement has ever existed and the denying party is usually the employer, striping the employee of their rights and interests.
Consequently, when entering the labor market, it is best to form and keep a copy of the labor contract within a safe location so that there are documents to verify if conflicts arise.
Nonetheless, this doesn’t mean that if there are only ‘oral’ relations or some other types of working agreements, the employees will automatically lose their rights and interests.
This is because even if the employer only makes an agreement but does not sign an employment contract, the court can still consider the agreement as an employment contract if it satisfies some requirements.
The enforcement capability of non-labor contracts
In Vietnam, the relationship between employee and employer is very complex, as they are not entirely based on concrete labor contracts.
According to Clause 1, Article 13, Labor Code 2019, in case the two parties agree with the document with a different name, it is also considered an employment contract if it contains the agreement on the paid job, salary, management, and supervision of a party.
In the current society of Vietnam, many employers will avoid signing labor contracts with employees to save a lot of costs for employers such as not having to pay social insurance, unemployment insurance, etc. This has seriously affected the legitimate interests of employees. More dangerously, it also causes loss of social security, increases the budget burden, etc. as these employees don’t directly contribute to the country but still enjoy many of its benefits.
However, with the new provisions in Clause 1, Article 13 of the Labor Code 2019, even if the labor contract is not signed but only negotiated in other forms then if a dispute occurs, the court can completely consider and decide that the agreement between parties is a labor contract if the elements of the labor contract are ensured according to the law.
Conditions of forming a labor contract in Vietnam
If in the past, two parties in the labor relationship were required to enter into a document called a labor contract, now with the provisions of Clause 1, Article 13 of the Labor Code 2019, no matter what type of contract, the following three conditions must be satisfied to be considered a labor contract, specifically:
- Agreement on employment between employer and employee;
- The content of payment of wages and salaries for jobs;
- The content of the management, administration, and supervision of one party.
In conclusion, although an oral agreement is not a labor contract, if it satisfies the required conditions, it still has the enforceability needed to solve a labor dispute between parties.
ASL LAW is the top-tier Vietnam law firm for Employment and Labor Law. If you need any advice, please contact us for further information or collaboration.
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