Three ways to hire in Vietnam
Foreign companies usually choose between setting up their own entity, using an Employer of Record (EOR), or engaging independent contractors. The right choice depends on headcount, timeline and how long you plan to stay.
| Option | Who is the employer? | Best for | Time to first hire |
|---|---|---|---|
| Own legal entity | Your Vietnamese subsidiary | Large, long-term teams | Several months of licensing |
| Employer of Record | The EOR (for example Nhân Kiệt) | First hires, market entry, small teams | As soon as the contract is signed |
| Independent contractor | No employer; service agreement | Defined projects, genuinely independent work | Days |
Long-term contractors who work like employees create misclassification risk. A Contractor of Record or a move to Employer of Record employment removes that risk.
Minimum wage in Vietnam (2026)
Vietnam sets monthly minimum wages by region. The rates below apply from 1 January 2026 under Decree 293/2025/ND-CP, an average increase of about 7.2% on 2025.
| Region | Typical areas | Monthly minimum wage |
|---|---|---|
| Region I | Urban districts of Hanoi and Ho Chi Minh City and other major urban areas | 5,310,000 VND |
| Region II | Other urban areas and surrounding districts | 4,730,000 VND |
| Region III | Provincial towns and their surroundings | 4,140,000 VND |
| Region IV | Remaining areas | 3,700,000 VND |
Employees in roles that require vocational training are commonly paid above the regional minimum. The exact region depends on the work location listed in the decree's annex.
Statutory contributions: social, health and unemployment insurance
Employers in Vietnam pay compulsory insurance on top of salary and withhold the employee's share. For Vietnamese employees the rates are:
| Contribution | Employer | Employee |
|---|---|---|
| Social insurance (retirement and survivorship 14%, sickness and maternity 3%, occupational accident and disease 0.5%) | 17.5% | 8% |
| Health insurance | 3% | 1.5% |
| Unemployment insurance | 1% | 1% |
| Trade union fee | 2% | None |
| Total | 23.5% | 10.5% |
- Salary cap: social and health insurance (and the trade union fee) are calculated on at most 20 times the base salary. With the base salary at 2,530,000 VND from 1 July 2026 (Decree 161/2026/ND-CP), the cap is 50,600,000 VND a month.
- Unemployment insurance cap: 20 times the regional minimum wage, which is 106,200,000 VND in Region I.
- Foreign employees with work permits are generally covered by compulsory social and health insurance, with exemptions such as intra-company transferees, but not by unemployment insurance.
Worked example: the true cost of a 30 million VND salary
A Vietnamese employee in Region I earning a gross salary of 30,000,000 VND a month:
| Gross salary | 30,000,000 VND |
|---|---|
| Employer social insurance (17.5%) | 5,250,000 VND |
| Employer health insurance (3%) | 900,000 VND |
| Employer unemployment insurance (1%) | 300,000 VND |
| Trade union fee (2%) | 600,000 VND |
| Total monthly employer cost | 37,050,000 VND |
| Employee contributions withheld (10.5%) | 3,150,000 VND |
| Take-home before personal income tax | 26,850,000 VND |
Try other salaries, regions and nationalities in our employer cost calculator. Personal income tax is withheld separately on a progressive scale after personal and dependant deductions.
Working hours, overtime, leave and public holidays
- Normal working time: up to 8 hours a day and 48 hours a week.
- Overtime: up to 40 hours a month and 200 hours a year (300 hours in certain sectors), paid at least 150% on weekdays, 200% on weekly rest days and 300% on public holidays.
- Annual leave: 12 paid days a year for normal working conditions, plus one day for every five years of service.
- Public holidays: 11 paid days a year: New Year's Day (1), Lunar New Year (5), Hung Kings' Commemoration (1), Reunification Day (1), International Labour Day (1) and National Day (2).
Employment contracts and probation
The Labour Code 2019 allows two contract types: indefinite-term contracts and definite-term contracts of up to 36 months. A definite-term contract can generally be renewed once; after that, continued employment must be on an indefinite-term contract.
| Role | Maximum probation |
|---|---|
| Enterprise manager | 180 days |
| Role requiring a college degree or higher | 60 days |
| Role requiring intermediate vocational qualifications | 30 days |
| Other jobs | 6 working days |
Probation salary must be at least 85% of the official salary, and there is no probation for contracts shorter than one month.
Ending employment: notice and severance
- Employee resignation notice: 45 days for indefinite-term contracts, 30 days for definite-term contracts of 12 to 36 months and 3 working days for contracts under 12 months.
- Severance allowance: half a month's salary for each year worked, for periods not covered by unemployment insurance.
- 13th-month salary: common practice around Lunar New Year, but only mandatory if it is in the contract or company policy.
Employer-initiated terminations are only lawful on the grounds set out in the Labour Code, with the required notice. An Employer of Record manages this process for you.
Hiring foreign nationals in Vietnam
Foreign employees need a work permit unless an exemption applies. Work permits are issued for up to two years, and holders can then apply for a temporary residence card. Processing times depend on the role and documents, so plan the start date with your provider. Nhân Kiệt supports work permit and temporary residence applications for employees hired through our Employer of Record service.
Paying independent contractors in Vietnam
Individuals paid under service agreements rather than labour contracts are generally subject to 10% personal income tax withholding on payments of 2,000,000 VND or more. Contractors who in practice work like employees can be reclassified as employees, with back-payment of insurance. See Contractor of Record and Contractor Management.
Key laws to know
- Labour Code 2019: contracts, working time, leave, discipline and termination.
- Law on Social Insurance 2024 (in force from 1 July 2025): compulsory social insurance.
- Law on Employment 2025 (in force from 1 January 2026): unemployment insurance.
- Law on Personal Data Protection (in force from 1 January 2026): handling of employee personal data.
- Decree 293/2025/ND-CP: regional minimum wages from 1 January 2026.
- Decree 161/2026/ND-CP: base salary of 2,530,000 VND from 1 July 2026.
This guide is general information, last reviewed in October 2026. It is not legal advice. Rules change, so confirm details for your situation with our team.