# Hiring in Vietnam

> Machine-readable page from Hire with Columbus (https://hirewithcolumbus.com/), a flat-fee employer of record (EOR) service.
> Canonical page: https://hirewithcolumbus.com/hiring-guides/vietnam/
> Pricing: from $179/month per employee, one transparent flat fee with no percentage-of-salary markups and no setup fees (https://hirewithcolumbus.com/pricing/).
> To hire: tell us where you want to hire at https://hirewithcolumbus.com/get-started/ and onboard your first employee in 2-3 days.
> Last updated: 2026-08-28

## Overview

Vietnam's employment law leans hard toward protecting the employee. Get the termination process wrong and you could be on the hook for severance worth up to 8.7 weeks of pay, on top of a notice period that averages 6.4 weeks. Get the employment contract wrong from the start, and you might not have a legally enforceable agreement at all.

That's the risk side. The good news is you don't have to solve it alone, and you don't have to build a legal entity just to hire one person in Ho Chi Minh City or Hanoi.

### Your three options

**Option 1: Set up your own entity**

- Cost: significant upfront legal, registration, and compliance spend, plus ongoing annual maintenance costs
- Timeline: 3-6 months minimum
- Complexity: full tax registration, payroll infrastructure, statutory HR processes, and ongoing local compliance
- Makes sense when: you're hiring 20+ people and planning a permanent, long-term presence in Vietnam

**Option 2: Hire contractors**

- Cost: none upfront, but limited control over how the person works
- Timeline: immediate
- Risks: misclassification penalties, back taxes, and potential labor disputes if the relationship looks like employment
- Makes sense when: you need a short-term project (under 6 months) or specialized skills, not an ongoing team member
- Note: Hire with Columbus also handles compliant contractor agreements and payments if that's the route you choose

**Option 3: Use an employer of record (recommended for most)**

- Cost: starting from $179/month per employee
- Timeline: 2-3 days to hire
- Complexity: none, we handle the contract, payroll, taxes, and compliance
- Makes sense when: you're hiring 1-50 people, testing the Vietnamese market, or building a team across several countries at once

### Why an EOR usually wins

If you're hiring one to ten people in Vietnam, entity setup will almost certainly cost more than several years of EOR fees combined, once you factor in legal fees, registration, and the salary of someone to manage local compliance. At $179/month per employee, hiring three people through Hire with Columbus runs about $537/month, no entity, no local bank account, no six-month wait.

If you're also hiring in other countries, the math gets worse fast with the entity route, since you'd need a separate legal setup in each one. An EOR lets you skip that entirely: one contract, one point of contact, compliant payroll and contributions handled for you, and the ability to scale up or down without unwinding a legal entity later.

Hire with Columbus employs the person locally on your behalf, so you get to manage the work while we manage the paperwork, the payroll cycle, the social contributions, and the compliance updates that come with Vietnamese labor law.

Ready to hire in Vietnam without setting up an entity or gambling on contractor status? Get started with Hire with Columbus.

## Employment Types

Before you draft an employment contract in Vietnam, you need to decide: entity, contractor, or EOR. That choice shapes everything else, from how fast you can hire to how much legal exposure you're carrying.

### How can you hire in Vietnam?

Here's how the three paths stack up against each other.

| Approach | Upfront cost | Timeline | Best for | Who's the legal employer |
|---|---|---|---|---|
| Set up your own entity | Incorporation, legal, and registration fees, plus ongoing accounting and compliance costs | Months, not weeks | 20+ employees, long-term market presence | Your new local entity |
| Hire contractors | Minimal, can start almost immediately | Days | Short projects under 6 months, specialized one-off skills | The contractor (in theory) |
| Use an EOR like Hire with Columbus | From $179/month per employee | 2-3 days | 1-50 employees, market testing, multi-country teams | Hire with Columbus |

**Setting up your own entity** makes sense once you've committed to Vietnam for the long haul. You'll need full tax registration, a local payroll system, legal compliance infrastructure, and HR staff to run it all. That's a real investment of time and money before you've hired a single person, and the ongoing accounting and compliance bill doesn't stop once the entity is live.

**Hiring contractors** feels like the fast, cheap option, and for a genuinely short-term project it can be. The risk is misclassification: if a "contractor" is working set hours, using your equipment, and taking direction like an employee, Vietnamese authorities can reclassify that relationship and hand you back taxes and legal disputes to sort out. Contractors also can't be managed like employees, so you lose control over how the work gets done. Hire with Columbus handles compliant contractor agreements and payment processing if that's genuinely the right fit for the role.

**Using an EOR** puts Hire with Columbus on record as the legal employer in Vietnam while you keep running day-to-day work and performance. We handle the employment contract, payroll, tax filings, benefits, and every compliance requirement in between. Five employees runs from $895/month with no incorporation costs and no waiting months for an entity to clear registration. For most companies testing Vietnam or hiring under 50 people, this is the path that gets someone working this week instead of next quarter.

### Employment contract types in Vietnam

Once you've picked your hiring approach, you still need the right contract type. Vietnam's Labor Code recognizes two main forms: indefinite-term and fixed-term contracts, plus part-time arrangements that sit under either.

**Indefinite-term (permanent) contracts** are the default for core, ongoing roles. Most companies hiring in Vietnam use this type for anyone they expect to keep long-term, since it signals stability and is what most candidates expect for a real job offer rather than a project gig.

**Fixed-term contracts** work for defined projects or temporary coverage. Vietnamese labor law caps how long a fixed-term arrangement can run and limits how many times it can be renewed before it must convert to indefinite status, so these aren't a way to keep someone on rolling short contracts indefinitely. If you're unsure whether a role should be fixed-term, that's usually a sign it should be permanent.

**Part-time employees** are entitled to the same core protections as full-time staff, on a pro-rated basis, including leave and social insurance contributions tied to hours worked.

| Contract type | Typical use | Conversion rule |
|---|---|---|
| Indefinite-term | Core, ongoing roles | N/A, this is the standard endpoint |
| Fixed-term | Defined projects, temporary coverage | Capped duration and renewal count set by statute |
| Part-time | Reduced-hours roles | Same protections as full-time, pro-rated |

Whichever type fits the role, Hire with Columbus drafts the contract to match Vietnamese labor law, handles the paperwork, and keeps track of any conversion triggers so a fixed-term hire doesn't accidentally become a compliance headache down the line.

## Payroll & Taxes

Your VND 20,000,000/month employee actually costs about VND 24,700,000 a month once employer contributions land on top. Here's the breakdown.

### Minimum and average wages

The minimum wage in Vietnam sits at VND 4,960,000 per month. The average monthly wage across the workforce runs closer to VND 8,580,000. Use these as your floor and your benchmark, not your target salary for skilled hires.

### Personal income tax brackets

Vietnam runs a progressive personal income tax system with seven brackets. Higher earners pay more on each additional slice of income, not on the whole amount.

| Monthly income (VND) | Tax rate |
|---|---|
| 0 - 5,000,000 | 5% |
| 5,000,000 - 10,000,000 | 10% |
| 10,000,000 - 18,000,000 | 15% |
| 18,000,000 - 32,000,000 | 20% |
| 32,000,000 - 52,000,000 | 25% |
| 52,000,000 - 80,000,000 | 30% |
| Above 80,000,000 | 35% |

The top rate of 35% kicks in fast compared to a lot of other markets in the region. Budget for it when you're pricing senior hires.

### Social insurance contributions

Both sides pay into social insurance, health insurance, and unemployment insurance. Employers also cover a trade union fee, which employees don't pay.

| Contribution | Employee pays | Employer pays |
|---|---|---|
| Social insurance | 8% | 17.5% |
| Health insurance | 1.5% | 3% |
| Unemployment insurance | 1% | 1% |
| Trade union fee | - | 2% |
| **Total** | **10.5%** | **23.5%** |

On average, employer social contributions work out to around 21.5% of gross pay across the workforce, since not every employer ends up paying the full trade union fee in every case. Build your budget around the full 23.5% to stay safe.

### Payment schedule

Payroll runs on a monthly cycle. A 13th month bonus is customary in Vietnam, meaning employees widely expect it around Tet even though it isn't a legal requirement. Skip it and you'll have a harder time retaining people, even if you're not breaking any law.

### Total employment cost example

Take a gross salary of VND 20,000,000 per month as a round illustration:

- Gross salary: VND 20,000,000/month
- Employer contributions (23.5%): VND 4,700,000/month
- **Total monthly cost: VND 24,700,000**
- **Total annual cost (before any 13th month bonus): VND 296,400,000**

Add the customary 13th month payment and you're looking at roughly one extra month of gross salary on top of that annual figure.

### Common payroll mistakes

- **Treating the 13th month bonus as optional.** It's not statutory, but skipping it damages retention more than it saves in cash.
- **Forgetting the trade union fee.** Companies budget salary plus the "obvious" insurance contributions, then get surprised by this extra 2%.
- **Applying a flat tax rate instead of the progressive brackets.** Payroll teams new to Vietnam sometimes tax the whole salary at one rate instead of calculating each bracket separately.
- **Running payroll off a foreign calendar.** Vietnam's monthly cycle and local tax filing timing don't always match what a US or EU payroll system defaults to.

### Doing this yourself vs. letting someone else handle it

Running payroll in Vietnam without local expertise usually means hiring a local accounting firm, buying payroll software, and carrying the compliance risk in-house. Someone on your team also has to stay current on bracket changes and contribution rules.

With Hire with Columbus: from $179/month per employee (USD), fully compliant. We calculate the brackets, remit the contributions, and handle the 13th month payment so you don't have to build a Vietnam payroll desk from scratch.

## Benefits & Leave

Maternity leave in Vietnam runs 26 weeks, and it's funded through social insurance rather than your payroll budget. That's one of the more generous maternity entitlements you'll run into globally, and it catches a lot of first-time employers off guard when they're budgeting headcount costs.

### Annual vacation

Employees get 12 days of paid annual leave as a statutory minimum. That's the floor, not a suggestion, and it applies regardless of contract type once someone's employed long enough to qualify.

A few practical points:

- Leave typically accrues over the course of the year rather than landing in a lump sum on day one.
- Unused leave doesn't just disappear when someone quits or gets let go. Vietnamese labor law generally requires unused annual leave to be paid out at the end of employment.
- Carryover policy beyond the statutory minimum is something you set contractually, within the bounds of the law.

If you're managing this manually across a few countries, tracking accrual and payout rules per employee gets messy fast. That's the kind of admin an EOR absorbs so you're not the one recalculating leave balances every payroll run.

### Sick leave

Sick leave in Vietnam is paid through social insurance, not directly out of employer payroll. Entitlement and certification requirements are tied to tenure and social insurance contribution history rather than a flat number of days for everyone.

Practically, this means:

- Employees need appropriate medical certification to claim sick leave through social insurance.
- The employer isn't the one footing the wage bill during covered sick leave, but you still need to process the paperwork correctly for social insurance to pay out.
- Getting this wrong doesn't usually mean a fine so much as a frustrated employee who doesn't get paid on time, which is its own kind of problem.

### Parental leave

| Leave type | Duration | Who pays |
|---|---|---|
| Maternity | 26 weeks | Social insurance |
| Paternity | About 5 days (0.7 weeks) | Social insurance |

Paternity leave is short compared to maternity leave, which is common in the region but still worth flagging to fathers on your team before they're surprised by it. Neither of these entitlements comes out of your payroll directly since they run through the social insurance system, but you still need to manage the transition, coordinate coverage, and file the right paperwork.

### Public holidays

Vietnam observes 4 official public holidays a year. Some fall on a fixed calendar date every year, while others follow the lunar calendar and shift annually, which means you can't just copy last year's calendar into next year's HR planning.

| Holiday type | What to know |
|---|---|
| Fixed-date holidays | Land on the same calendar date every year (for example, January 1) |
| Lunar-calendar holidays | Dates shift annually and are confirmed via official government announcement |

Employees who work on a public holiday are entitled to a premium on top of normal pay under Vietnamese labor law. If you're running payroll yourself, you need to track the exact 2026 dates (including the lunar ones) to make sure premium pay and time off land correctly. This is exactly the kind of detail an EOR tracks automatically so nobody on your team has to check a lunar calendar every January.

### Mandatory benefits and contributions

Three things are mandatory in Vietnam: social insurance, health insurance, and unemployment insurance. Both employer and employee contribute, and the employer also owes a separate trade union fee.

| Contribution | Employee pays | Employer pays |
|---|---|---|
| Social insurance | 8% | 17.5% |
| Health insurance | 1.5% | 3% |
| Unemployment insurance | 1% | 1% |
| Trade union fee | - | 2% |
| **Total** | **10.5%** | **21.5% (plus 2% union fee)** |

Social insurance is the bucket that covers retirement, and Vietnam's retirement age is currently 61.5 years. The employer side of contributions adds a meaningful percentage on top of gross salary, so factor that into your cost planning rather than budgeting off base salary alone.

Miss a contribution filing or get the calculation wrong, and you're not just risking a fine. You're risking an employee's access to health coverage or pension credit, which is the kind of mistake that damages trust fast.

### Optional and competitive benefits

A 13th month salary (often tied to Tet, the Lunar New Year) is customary in Vietnam even though it isn't a hard legal mandate. Skipping it doesn't break the law, but skipping it also makes you a noticeably less attractive employer in a market where it's the norm.

Beyond that, companies competing for talent commonly add:

- Supplemental private health insurance on top of the mandatory state scheme
- Meal and transport allowances
- Performance bonuses layered on top of the customary 13th month payment

### Common mistakes

- Assuming the employer pays maternity or sick leave directly, when it's actually funded through social insurance and requires correct filing to get employees paid.
- Forgetting the trade union fee, which is a separate employer obligation from the core social insurance contributions.
- Not paying out unused annual leave at termination.
- Treating the 13th month payment as optional in a market where employees expect it as standard practice, hurting retention even without a legal penalty attached.

### The real cost of getting this right

Administering Vietnamese benefits correctly means staying current on social insurance filings, tracking a partly lunar holiday calendar, and making sure contribution rates are applied to the right base salary every month. Doing that in-house usually means a local HR hire, ongoing legal review, and software to track leave balances and contribution schedules, plus the risk of fines or back-pay if something slips.

Hire with Columbus handles all of this, contributions, leave tracking, holiday calendars, and payout calculations, for $179/month per employee (USD). You get compliant benefits administration without needing to become a Vietnamese labor law expert yourself.

## Compliance

Written contracts are mandatory in Vietnam. Verbal agreements don't hold up if a dispute lands in front of a labor authority, and they leave you with zero protection if an employee walks or underperforms.

### Employment contract requirements

Every employee needs a written contract in Vietnamese (a bilingual version is common practice, but the Vietnamese text is what governs). At minimum, the contract needs to spell out:

- Job title, duties, and work location
- Salary, payment schedule, and any allowances
- Working hours and rest periods
- Contract term (definite or indefinite)
- Social insurance and other statutory contributions

Skip one of these mandatory clauses and you risk the whole agreement being challenged as invalid. That opens the door to back-pay claims and disputes over terms you thought were settled.

### Probation periods

Probation length isn't a fixed number you can pick freely. It's tied to the role and capped by statute.

Build it into the contract explicitly, either as its own probation agreement or a clause. An undocumented "trial period" doesn't count and treats the person as a full employee from day one, protections included.

During probation, either side can end the arrangement without the notice and severance obligations that apply to confirmed employees. Once probation ends and you keep someone on, full employment protections kick in immediately.

### Working time rules

Standard working hours run up to 48 hours a week under Vietnamese labor law, and actual average hours worked sit around 45.8 hours a week. Overtime needs the employee's agreement and has to be tracked and paid, not just absorbed into a flat salary.

Keep time records. If a dispute over unpaid overtime or excess hours comes up, the burden lands on you to show what was actually worked and paid.

### Notice periods

| Situation | Notice requirement |
|---|---|
| Employer or employee ending an indefinite/definite contract | Statutory notice averages 6.4 weeks, with exact length set by contract type and law |
| During probation | No statutory notice period required |

Notice has to be in writing and delivered before the last working day, not handed over as a surprise on the way out the door.

### Termination process

You can't dismiss someone in Vietnam without a valid legal ground, spelled out in the contract or the Labour Code (poor performance, redundancy, disciplinary cause, etc.). For disciplinary terminations, you typically need to run a documented process, notify the employee, and in some cases involve the workplace union before the dismissal is final.

Skip the process and the dismissal can be ruled unlawful. That usually means paying compensation, covering the notice you skipped, and in some cases reinstating the employee.

### Severance pay

| What's owed | Amount |
|---|---|
| Severance allowance (where applicable) | Averages about 8.7 weeks of wages, calculated against years of service under the applicable formula |

Severance generally applies when an employee has been with you long enough and the termination falls outside disciplinary cause. It's paid alongside, not instead of, any outstanding wages or unused leave.

### Data protection

Employee data (ID numbers, salary details, health records, social insurance data) needs to be collected, stored, and shared only for legitimate employment purposes. Get consent where required, limit access internally, and don't ship personal data to third parties without a clear legal basis.

### Common compliance mistakes

- **Invalid employment contract**: missing a mandatory clause voids protections you thought you had and exposes you to back-pay claims.
- **Wrong termination process**: skip proper cause, notice, or union consultation and you're looking at severance plus legal costs, and maybe a reinstatement order.
- **Verbal or undocumented probation**: treated as a full contract from day one, no fast-exit option.
- **Sloppy time records**: leaves you unable to defend against overtime claims.

Hire with Columbus runs every contract, probation clause, and termination through Vietnam's Labour Code before anything gets signed. That way, you're not the one finding out about a missing clause after an employee's already filed a complaint.

## Updates

Vietnam updates its labor and tax rules often enough that "what applied last year" isn't a safe assumption. Here's what's actually in effect for 2026, so you're not building an offer letter on outdated numbers.

### Retirement age keeps climbing

Vietnam has been raising its statutory retirement age gradually for several years, and as of 2026 it sits at 61.5 years. If you're hiring older workers or planning long-term headcount, factor this into pension and social insurance planning now rather than later.

### Leave entitlements you need to budget for

Maternity leave is set at 26 weeks, which is generous by regional standards and something you should plan staffing coverage around well before an employee's due date. Paternity leave is much shorter at 0.7 weeks. Annual leave sits at 12 days, and public holidays add 4 more days per year on top of that.

### Tax brackets are progressive, and the top rate bites

Personal income tax in Vietnam runs on a progressive scale with seven brackets, topping out at a 35% marginal rate for the highest earners.

| Monthly income (VND) | Tax rate |
|---|---|
| 0 - 5,000,000 | 5% |
| 5,000,000 - 10,000,000 | 10% |
| 10,000,000 - 18,000,000 | 15% |
| 18,000,000 - 32,000,000 | 20% |
| 32,000,000 - 52,000,000 | 25% |
| 52,000,000 - 80,000,000 | 30% |
| Above 80,000,000 | 35% |

Corporate tax stays at 20% and VAT holds at 10%. Neither is new, but both are worth confirming since Vietnam does revisit rates periodically.

### Social contributions add up on both sides

Employees contribute roughly 10.5% of gross pay on average once you combine social insurance, health insurance, and unemployment insurance. Employers carry a heavier load, averaging around 21.5% of gross, which includes a trade union fee on top of the standard insurance categories. Budget for this on every hire, not just the base salary line.

### What this means for your hiring plan

None of these numbers are static, and Vietnam doesn't give much advance notice when contribution rates or bracket thresholds shift. If you're running payroll yourself, that means checking official updates every year. This is exactly the kind of moving target an EOR like Hire with Columbus tracks for you, so your payroll stays compliant without you having to monitor Vietnamese regulatory bulletins on top of running your business.

Hire in Vietnam from $179/month per employee: https://hirewithcolumbus.com/get-started/

Best EOR shortlists and comparisons: https://hirewithcolumbus.com/best/