Unilateral termination of labour contracts is the act of employers terminating labour contracts with their employees without obtaining the employees’ approval. The current regulations of Vietnam allow employers to unilaterally terminate labour contracts in cases specified in Article 36 of the Labour Code.
In order to avoid risks when unilaterally terminating labour contracts, the employers should take the following points into account.
(i) Archiving evidence proving the basis of unilateral termination of labour contract
When unilaterally terminating labour contracts, employers need to acquire specific and clear evidence proving that the basis of termination is in accordance with Article 36 of the Labour Code. The storage of such evidence is equally important to avoid potential risks should disputes arise.
As shown in practice, many enterprises unilaterally terminate labour contracts with their employees without being able to prove the basis of such termination. Therefore, their termination of labour contracts is considered violation of the law and they are forced to compensate for losses suffered by the employees.
(ii) Circumstances in which employers are not permitted to unilaterally terminate labour contracts
Employers cannot unilaterally terminate labour contracts in the following cases:
- The employee, after an illness or after suffering an injury caused by a work-related accident or an occupational disease is being treated or nursed pursuant to the direction of a competent medical consulting or treating establishment, except in the case prescribed in Article 36.1.b
- The employee is on annual leave, personal leave of absence, or any other case of leave agreed by the employer.
- The female employee is pregnant; or an employee is currently on maternity leave or is nursing a child under 12 months of age.
(iii) Ensuring the time required for advance notice to the employees
In case of unilateral termination of labour contracts, employers shall abide by the time required for advance notice to the employees as prescribed in Clause 2, Article 36 of the Labour Code as follows:
- At least 45 days in case of an indefinite term labour contract;
- At least 30 days in case of a definite term contract with a term of 12 up to 36 months;
- At least 03 working days in case of a definite term contract with a term of less than 12 months
In other cases, the period for advance notice will be longer for special employment positions such as Manager of an enterprise; crew members of a crew working on Vietnamese ships currently operating abroad; crew members who were sublet by Vietnamese enterprises working on foreign ships; Members of aircraft flight crews; aircraft maintenance technicians, aviation repairmen; flight operators and dispatchers.
(iv) Paying allowances to employees
According to Clause 2, Article 48 of the Labour Code, when terminating labour contracts, employers will have to pay: Salaries, social insurance, health insurance, unemployment insurance, job loss allowances and other benefits of the employees in accordance with collective labour agreements and labour contracts.
We hope this article has provided you with basic things to keep in mind when unilaterally terminating labour contracts. Should you have any queries, please do not hesitate to contact us.
Disclaimer: This article is for general information only and is not a substitute for legal advice. Apolat Legal is a Vietnamese law firm with experience and capacity to advise on matters related to Employment. Please click here to learn more about our services and contact our lawyers in Vietnam for advice via email firstname.lastname@example.org.