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Vietnam: Code Amended to Balance Employer-Employee Interests

(June 21, 2012) Since its promulgation in 1994, the first Labor Code of Vietnam (International Labor Organization, NATLEX) has been amended three times, in 2002, 2006, and 2007. In 2012, the Code was amended again after approval by the National Assembly on June 18, 2012. (Announcement no. 20 of National Assembly XIII, session 3 [in Vietnamese], National Assembly (June 18, 2012).)

The amended Code sets forth a longer permitted period of maternity leave. Female employees may have six–months of maternity leave instead of the previous four months of leave. The six–months of leave consists of time off both before and after childbirth. However, no more than two months of the leave may be taken before childbirth. (The National Assembly to Approve the Labor Code (Amended) [in Vietnamese], Ministry of Labor, Invalid and Social Affairs (June 19, 2012); Female Employees to Have Six-Month Maternity Leave [in Vietnamese], TuoiTre (June 18, 2012); Six-Month Maternity Leave [in Vietnamese], VN Express (June 18, 2012).)

The amended Code also contains minimum wage provisions, the first such provisions ever codified in Vietnamese law. Hourly, daily, and monthly rates will be determined, and they will vary by geographic area and by industry. For geographic areas, the minimum wage will be determined by the central government. (TUOITRE, supra.). For industries, the minimum wage may be fixed in an industry-level collective labor agreement, where such agreements exist. Industry-level collective labor agreements are a new mechanism in Vietnamese labor law and are signed between the labor unions and employers in a particular industry. The minimum wage in each industry must not be lower than that designated for the geographic area. (Id.)

The Code will be effective as of May 1, 2013. The government is expected to release over 20 decrees to guide the implementation of the Code. (Id.)

Prepared by Loi Huynh, Law Library Intern, under the supervision of Sayuri Umeda, Senior Foreign Law Specialist.