VIETNAM Law and Practice Contributed by: Thang Nguyen, Minh Nguyen and Nguyet Le, ACSV Legal
binding, and both the employers and employ - ees, whether starting work prior to or as from the binding date, must implement it, and comply with it, when it has been signed by legal repre - sentatives of the employer and the labour col - lective. The collective labour agreement shall prevail over labour contracts and other rules of the employer if it stipulates greater rights, obliga - tions and interests for the parties. In Vietnam, sector-specific agreements, known as industry collective labour agreements, exist. An industry collective labour agreement may also apply to a non-member enterprise if it has a scope of appli - cation covering more than 75% of employees or enterprises in the same industry in the industrial zone, economic zone, export processing zone or high-tech zone as decided by the competent authority. Trade Unions Enterprise-level trade unions are the most com - mon in Vietnam and are formed voluntarily as grassroots units of the national union. They work alongside state bodies to protect employees’ rights and may monitor company operations. Employers must recognise and facilitate trade union activities and contribute 2% of their sal - ary fund (used for social insurance) to the trade union fund, regardless of whether a union exists. From 1 July 2025, expatriates with labour con - tracts of 12 months or more will be eligible to join grassroots trade unions – an important change under the new Law on Trade Unions. Workers’ Union In addition to trade unions, employees may form or join a workers’ union under the 2019 Labour Code, subject to registration with the competent authority. Workers’ unions have equal rights and
obligations as trade unions but cannot include both ordinary employees and those involved in HR decisions. A minimum number of employee members is required at registration, as pre - scribed by the government. 4.5 Employee Representations Other than the powers and rights given to trade unions, it is not mandatory for employees to be represented, informed or consulted by manage - ment in Vietnam. For the sake of clarification, under the 2019 Labour Code, while a representative organisa - tion of employees at the grassroots level (ROE), including a grassroots trade union or workers’ union at an enterprise, is voluntarily estab - lished by employees to protect their legitimate rights and interests in labour relations with their employer, the involvement of the ROE is required in certain circumstances, specifically: • circulation of the performance improvement plan; • retrenchment; • termination with multiple employees due to a change of control; • establishment of pay scales, payrolls and labour productivity norms; • circulation of bonus regulations; • issuance or amendment of internal labour regulations; and • application of disciplinary measures. If an ROE is not established within the compa - ny, the employer may be required to seek the involvement of a trade union at a higher level. However, this process can be time-consuming and may prolong the overall process of address - ing the matters that require ROE participation.
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