Client note – new labor code 2019

After much consultation and heated debate, Vietnam adopted a new Labor Code on 20 November 2019 (Labor Code), which will come into effect on 1 January 2021, and replace the current law which dates from 2012.

While Vietnam's labor legislation has always been seen as employee-friendly and highly regulated, a motivation for adopting the Labor Code was the need to ramp up certain employee protections in order to meet labor standards commitments given by Vietnam in recent new-generation free trade deals such as the EU-Vietnam Free Trade Agreement and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Conversely, the views of employers were canvassed during the law's public consultation process, and as a result some aspects of the Labor Code have been shaped in a more employer-friendly manner.

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