Guidance on signing labor contracts with foreigners

DungTran October 28, 2021

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Posts : Guidance on signing labor contracts with foreigners In the section LSX Lawfirm

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Guidance on signing labor contracts with foreigners. Foreigners have a tourist visa to Vietnam. Then that person wants to work in Vietnam. My company signed a 3-month labor contract with that person. Appoint that person to the Head of the branch and authorize that person to sign all documents, including taxes, invoices, banking, revenue, expenditure, etc. During this time, the person does not have a work permit. So, when that person works at the company and signs the above documents, is it legal or not? Let us learn about this topic with LSX law firm as follow:

Legal grounds:

Decree 152/2020/ND-CP

Decree No. 28/2020/ND-CP

Signing labor contracts with foreigners without a work permit

Article 7 of Decree Decree No. 95/2013/ND-CP stipulating cases where foreign workers are not eligible for work permits:

In addition to the cases specified in Clauses 3, 4, 5, 6, 7, and 8 Article 154 of the Labor Code, foreign workers are not eligible for work permits:

1. Being the owner or capital contributor of a limited liability company with a VND 3 billion or more capital contribution value.

2. Also being the Chairman of the Board of Directors or a member of the Board of Directors of a joint-stock company with a VND 3 billion or more capital contribution value.

5. To be licensed by the Ministry of Foreign Affairs to operate information and press in Vietnam under law.

8. Entering Vietnam to work as a manager, executive director, expert, or technical worker with less than 30 days and no more than 3 times a year.

9. Enter Vietnam to implement international agreements signed by central and provincial agencies and organizations under law.

11. Relatives of foreign representative missions in Vietnam specified at Point 1, Clause 1, Article 2 of this Decree.

12. Also having an official passport to work for state agencies, political organizations, socio-political organizations.

13. Person responsible for establishing a commercial presence.

14. Being certified by the Ministry of Education and Training for foreign workers to enter Vietnam for teaching and research purposes.

Thus, based on the above regulations, foreigners working at your company are not in this case. Accordingly, this person will be required to apply for a work permit when working in Vietnam.

Penalties for signing labor contracts with foreigners without work permits

When your company signs a 3-month labor contract with that person, that person does not have a Work Permit during this period. This will be sanctioned according to the provisions of Article 31 of Decree 28/2020/ND-CP as follows:

Article 31. Violations against regulations on foreigners working in Vietnam

3. A fine of between VND 15,000,000 and VND 25,000,000 shall be imposed on foreign workers working in Vietnam committing one of the following acts:

a) Firstly, working without a work permit or without a written confirmation of not being eligible for a work permit as prescribed by law;

b) Secondly, using an expired work permit or written confirmation that the work permit is not eligible.

4. Fines shall be imposed on employers who use foreign workers to work in Vietnam without a work permit; or do not have a certificate confirming that they are not eligible for a work permit or employ a foreign worker whose work permit has expired; or a written confirmation that the work permit is not suitable for an expired work permit at one of the following levels:

a) From VND 30,000,000 to VND 45,000,000 for violations from 01 to 10 people;

Foreigners working in Vietnam without a work permit will be expelled from the Vietnamese territory. As for your company, when using this employee, you will be fined from 30,000,000 VND to 45,000,000 VND. And, of course, the documents that the person signs will not have any legal value.