January 20, 2017

New Circular Providing Guidance to the Employment of Foreign Workers

Circular No. 40/2016/TT-BLDTBXH providing guidance on implementing Decree No. 11/2016/ND-CP (regarding foreign employees in Vietnam replacing Circular No. 03/2014/TT-BLDTBXH) was published and came in force since 12 December 2016.

Decree No. 11/2016/ND-CP dated 3 February 2016 provides guidance work permit for foreigners working in Vietnam. Notable changes include:

Qualification documents for experts and specialist’s work permit require both a university decree (or higher) in related field and a 3-year work testimonial.

The work permit issuance process is basically simplified. The processing time for labour departments to issue work permit is shortened from 10 to 7 working days.

For work permit renewal, the application should be submitted up to 45 days prior to expiry of the current work permit instead of 15 days as per old regulations. The Decree 11 came into effect on 1st April 2016 replacing Decree 102/2003/ND-CP dated 5th September 2013. During 2016, the EuroCham HR and Training SC has worked with MOLISA and VCCI on drafting and proposed removal of some requirements of the Decree.  

The Circular 40/2016/TT-BLDTBXH provided detail guidelines of Decree No. 11/2016/ND-CP regarding procedures issuing work permit to foreign labors in Vietnam. The Circular took effect from 12th December 2016 replacing Circular No. 03/2014/TT-BLDTBXH dated 20th January 2014. One of the key changes in this new Circular is the transfer of authorization from The Department (DOLISA) to Ministry of Labour, Invalids and Social Affairs (MOLISA) to approve request for employment of foreign labourers of enterprises (except contractors). In regard to contractors, the competence to approve the demand for employment of foreign labourers still belongs to the DOLISA. MOLISA will be responsible for approving proposals for recruiting foreign labourers, identifying unlicensed foreign workers, reusing and revoking work licenses and deportation of unlicensed foreign labourers.

According to Clause 2 Article 18 of this Circular, if foreign labourer with a valid work permit is assigned, seconded or designated to work in another province/city to perform the same job assignment for minimum 10 consecutive days, a new work permit shall not be granted. Instead, his/her employer must inform in written to the DOLISA of that province/city working location of the foreign labourer.

EuroCham and its HR and Training Sector Committee are going to organise a workshop in February to update members on the regulation changes, implementation status and impacts.

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