Resolution 105 Amendments
Recently issued Resolution No. 105/NQ-CP (“Resolution 105”), which applies to enterprises, cooperatives, and business households, has altered the definition of “work experience” required for foreign workers, making it easier to obtain work permits. The Resolution was ratified by the Prime Minister and issued on September 9th, 2021. One of the purposes of Resolution 105 is to ease some of the stricter hiring requirements, instituted by Decree No 152/2020/ND-CP (“Decree 152”) which took effect in February, 2021, to assist businesses that have been affected by the pandemic.
Pursuant to the Decree 152 foreigners must hold a Bachelor’s degree or higher, or an equivalent degree, and have “at least three years of work experience in the specialties that the workers were trained in”.
While the requirement of a Bachelor’s degree or higher or an equivalent degree remains, the work experience requirement of Article 3.6.(a) of Decree 152 has been amended by Resolution 105 to “having at least three years of work experience that matches the jobs foreigners plan to work in Việt Nam”.
This new definition is supported by Article 9.4.(b) of Decree No. 152 which provides that previous issued Work Permits may now be submitted as documentation to prove eligibility for new Work Permit applications, thereby removing the need for the previous experience to have been obtained outside of Vietnam. The amended version states: “The papers proving experts and technical workers under regulations in Clauses 3, 6 in Article 3 of this Decree are: diplomas, degrees, certificates, testimonials; confirmation documents issued by agencies, organizations, and enterprises in other countries about the years of experience of experts and technical workers; or the already granted work permits to prove experience.” (Emphasis added).
It is a change that the business community in Vietnam has been respectfully advocating for years. Compliance with the experience prerequisite has now been made easier and there is no further need to obtain the necessary experience in a field that the worker was trained in outside of the country. Instead, the requirement has been modified to focus on the work that the foreign expert will be performing in Vietnam, saving time and costs for enterprises and improving the country’s pace of development.
Another change affects the requirement for university degrees for foreign workers is equally significant. Under Decree 152, the university degree of the foreign worker needed to be related to the job position in Vietnam. However, under Resolution 105, the agencies have been requested to be flexible where the degree is not necessarily related to the job position within Vietnam. As such, businesses have much wider latitude and flexibility to hire experts and technicians whose educational background and initial experience may not necessarily match the exact specifications of the intended position.
A further amendment instituted by Resolution 105 in September, 2021 involves the transfer of foreign workers by the company from one province in Vietnam to another. Previously, under Decree 152, a foreign worker could not be sent to another province in Vietnam to work without obtaining a new work permit. Under the amended rules, a company can now transfer a foreign worker to a different province in Vietnam without having to reapply for a new work permit for a period not exceeding 6 months. However, one of the remaining requirements is that the employer must notify the labor department of the location of the worker during this period of transfer.
For foreign teachers, Resolution 105 directs the Ministry of Education and Training to cooperate with the Ministry of Labor, War Invalids and Social Affairs (MoLISA) to provide further guidance and qualifications for training centers, high schools, vocational education centers and universities following international best practices.
In light of the pandemic, the government has further requested relevant agencies to search for ways to streamline the entry requirements for foreign workers as well as explore the implementation of vaccine passports.
A final amendment that affects foreign workers concerns the notarization of passports. Previously, passports for foreign workers were required to be notarized. However, under Resolution 105, only a copy of the passport is necessary during the application process.
The Work Permit Process
Prior to Resolution 105 described above, the government of Vietnam introduced Decree 152, which was implemented on February 15, 2021. Decree 152 regulates the hiring of foreign workers in Vietnam as well as the hiring of Vietnamese employees that are employed with foreign companies. Decree 152, which supplanted Decree 11/2016/ND-CP and Decree 75/2014/ND-CP, generally contained stricter regulations in comparison to the previous decrees. This resulted in several businesses raising concerns due to the increased difficulties of hiring and obtaining entry of foreign workers into the country. As stated, many of these issues were addressed by the recently issued Resolution 105 (see above).
In Vietnam, it is the company that applies to receive approval to employ an individual in a specific position. The employer may seek assistance from other parties to complete the process, but they cannot leave it to solely to the employee to obtain the work permit. In addition, employers should make the potential employee aware of the work permit requirements during recruitment. Further, as the process generally takes some time to complete, the hiring action should be well-planned and mapped out ahead of time.
With regards to the overall process, the employee is required to obtain and submit several documents including: a letter from the employer that confirms their job within the company; a police or criminal clearance certificate, no less than six months old; copies of relevant qualifications and degrees (or proof of five years’ relevant experience); summary CV and proof of professional background and experience; a copy of the employee’s passport with at least another 6 months validity; two recent passport photos; a certificate of health from an approved hospital in Vietnam or the employee’s home country; and completion of the work visa application. Typically, the employer will assist the prospective employee with the gathering of this documentation.
Employers seeking to hire a foreign employee must submit a written request for approval to hire a foreign worker to the MoLISA within 30 days prior to the start date of employment. MoLISA will usually respond to the request within 10 days.
Once approval is received, the employer may then apply for a work permit from the MoLISA. This should be applied for at least 15 days prior to the foreign worker commencing employment. A number of documents must also be submitted by the employer, including the work permit application form; the labor contract; the job description; the approval from the committee that allows employment of foreign workers; and the business registration certificate. Work permit processing times may take up to 05 business days. However, in reality the process can take much longer and it is recommended that companies apply two to three months in advance of employee’s start date.
When the application is approved, the employee may obtain a working visa and travel to Vietnam. Further, their status as a temporary resident must be declared at the local police authority. Following this, a temporary residence card, with a duration equal to that of the work permit (2 years), can be applied for and will replace the working visa.
Work permits for foreign workers are valid up to two years and may renewed only once. Renewals must be made not later than 5 days prior to the expiration of the work permit (but not before 45 days prior). Following the expiration of the first renewal, a new work permit must be applied for.
Decree 152 contains several exemptions from work permits. For example, a foreigner may be exempt from a work permit if their capital contribution to the company is at least US$130,400 (VND 3 billion). In addition, experts, managers, or technicians that enter Vietnam for less than 30 days (no more than three times in a year) may be exempted from obtaining a work permit. Another exemption involves foreign workers who are married to Vietnamese citizens and living in Vietnam. Businesses that employ foreign personnel that are exempt from work permit requirements must inform MoLISA at least three days prior to the employee starting work in Vietnam.
Despite the recent easing of some of the requirements for foreign workers obtaining work permits pursuant to Resolution 105, businesses need to remain cautious and follow the legal provisions strictly. Penalties for violating the laws on work permits include deportation and fines for the foreign worker, significant fines for the business (up to 75,000,000 VND depending on the number of workers involved), confiscation of technical certifications, and even temporary suspension of business operations.
Le & Tran’s internationally recognized Labor and Employment attorneys are available to answer any of your questions. Our main office is located in Ho Chi Minh City, the business center of Vietnam. Please feel free to contact us at email@example.com to arrange a consultation.