Vietnam: Amendment to Labour Decree 152 Affecting Foreign Nationals Issued

CHANGE

DETAILS

IMPACT

Definition and eligibility revisions

Changes to definition of Experts and Technical Workers.

• • Experts. The current definition of an Expert, according to Decree 152, is a foreign worker who obtains at least a bachelor's degree or equivalent and has at least three years' experience in their training field corresponding with the job position/job assignment that they will be appointed in Vietnam. The amendment reverts to the same definition as that used in Resolution 105, which eased the requirement for the degree major to be specifically relevant to the proposed job title (“degree relevancy”).
  • Technical Workers. The current definition of a Technical Worker, according to Decree 152, is a foreign worker who has been trained in a technical field or another major for at least one year and has worked for at least three years in their training field. The amendment removes the specification of the training field and emphasizes the relevancy of the work experience to the job position/job assignment in Vietnam.

Applicants should generally benefit from the clarity of the new definition in terms of qualifications. However, it remains possible that the various local DOLISAs could still impose their own adjudication standards (although the fact that the Resolution 105 wording has been adopted in Decree 70 would hint to the intention to move away from that inconsistency).

New labor market testing requirement

From January 1, 2024, sponsoring entities will need to submit proof of a labor market test at least 15 days before seeking to hire a foreign national. Currently, this has only been applied in certain jurisdictions (e.g., Ho Chi Minh City) and in an ad hoc manner. The new requirement indicates that such recruitment should be undertaken on the electronic jobs portal of MOLISA or the relevant Employment Service Center.

• All sponsoring entities will need to follow the new labor market testing requirement from January 1, 2024, which represents an additional step for work permit applications (and could therefore prolong the process).
• However, the standardization and streamlining of the labor market testing requirement may benefit sponsoring entities by reducing uncertainty in the work permit application process. Fragomen may be able to provide support with this new requirement and will provide further updates (as the government releases further details).

Job Position Approval (JPA) submission procedure updates

• • Changes to JPA submission timing. The government is modifying the timing for JPA submissions. Where it is currently required to be submitted at least 30 days prior to the assignment start date, the new rule requires submissions to be made only 15 days prior to the date on which foreign workers are expected to be employed.
  • Expansion of JPA exemptions. The amendment expands the exemptions for the JPA and extends it to, for example, foreign lawyers and foreign nationals married to Vietnamese spouses.
  • Clarifications for application forms. The new proposed Amendment seems to clarify that application Form 1 should be used for all new JPA applications, while Form 2 should only be used for a change in job location, change in Working Form (i.e., ICT or local hire), or a change in duration. 

• • While it would seem beneficial for the authorities to reduce the timeframe for JPA submission (and applicants and companies may similarly benefit, as the foreign labor needs of the company may only be apparent closer to the anticipated start dates), in actual practice, the entire process for work permit approval is likely to take longer than that timeframe and we would still recommend a longer lead time for submission.
  • For foreign nationals married to Vietnamese spouses, the proposed changes represent a more formal codification of their requirements. Under the existing regime, a work notification is simply required (with no documentary proof issued after) to be submitted to the local DOLISA (with the resulting visa status granted derivative of their dependent visa status).  Under the proposed changes, such applicants should request a Work Permit Exemption Certificate. In the long term, this could potentially benefit such individuals as there would be a more formal status document (i.e., written certificate) issued by the government.
  • The confirmation that Form 1 should be used for all new JPA applications should be a welcome change from existing practice. Currently, many DOLISAs have been requiring Form 2 to be completed for new JPA applications, which requires much more extensive documentation and justification (compared to Form 1).

Document requirement adjustments

• • The government will start accepting alternative documents such as Certificates of Completion and Certificates of Graduation in lieu of Degree Certificates for Work Permit applications.
  • Additionally, the government will start requiring additional documentary proof for Managers and Executives for Work permit applications, including their appointment on the company’s charter or operation regulations; the certificate of enterprise registration or certificate of establishment or establishment decision; and resolution or decision on their appointment to the position.
  • For Experts and Technical Workers, the amendment confirms that previously issued Work Permits and/or Work Permit Exemption Certificates (WPEC) can be used as proof of relevant experience/expertise.

• • Certain foreign nationals from countries where Degree Certificates may not be issued (and where equivalent certifications may instead be conferred) should benefit from the relaxation of this requirement by being able to submit alternative documents such as certificates of graduation or certificates of completion. This was also temporarily accepted during the Resolution 105 period.
  • Conversely, for Managers and Executives, the new requirements are more burdensome and onerous and may rule out the Manager or Executive category for several applicants. 
  • For the Expert and Technical Worker categories, the allowance of previously issued Work Permits/WPECs as proof of relevant experience would be a welcome change (as, currently, they are not considered). This was also temporarily accepted during the Resolution 105 period.

Work Permit exemption and reporting updates

• • Introduction of WPEC requirement for spouses of Vietnamese nationals. Notwithstanding the forthcoming JPA exemption for spouses of Vietnamese nationals, the government will require such spouses to obtain a WPEC.
  • Introduction of additional reporting requirements. Additional reporting requirements are being introduced for Work Permits or WPECs issued by MOLISA (in the special circumstances where the applicant may be working in multiple provinces). Under the proposed amendment, companies would need to report electronically to MOLISA and to the local provincial DOLISAs (where the individual would be working) on such MOLISA-issued work permits or WPECs. 

• • The new WPEC requirement should benefit spouses of Vietnamese nationals who will have a government-issued certificate to show authorization to work in Vietnam, instead of the current practice (see above).
  • The new reporting requirement should not have a major impact where the Work Permit or WPEC is issued by the local provincial DOLISAs (and only applies to those issued by MOLISA itself). That said, there are no further specifics provided in the text of the amendment and so it is expected that MOLISA will issue further guidance.

Work Permit compliance rule changes

• Requirement to report all work locations. The labour authorities will require all work locations within the same province/municipality to be reported at the outset in the work permit application. Where the foreign worker is working in different provinces or cities, the sponsoring entity may submit its applications to MOLISA (rather than the local DOLISAs).
• Reissuance of work permit for enterprise name changes. On top of existing triggers for the reissuance of work permits, the amendment confirms that in the specific scenario when the sponsoring entity’s enterprise name changes (but with no corresponding change to the enterprise identification number), a reissued work permit (as opposed to a new work permit) will be sufficient.
• Additional guidance for applications beyond the current maximum. The amendment provides some additional guidance for those who have reached the maximum four-year validity period for Work Permits issued under Decree 152 (a previously unaddressed topic). The amendment seemingly confirms that such individuals will be permitted to apply for a new work permit, so long as it is for the same position and title. For such applications, previously issued Work Permits or WPECs will also suffice to justify the expertise.

• • For applicants who report to different sites/locations in the same province/municipality, it is unclear how the requirement to report on all sites will be implemented/enforced.  For applicants working in different provinces/cities, they may come under the jurisdiction of MOLISA (which is known to be stricter in its requirements), although it is possible that the current practice (of applying at each separate local DOLISA) will be permitted to continue.
  • For the scenario where the sponsoring entity’s enterprise name changes only, applicants will benefit from the confirmation that a reissuance of the work permit only is sufficient.
  • Work Permit holders may benefit from an opportunity to continue working in Vietnam beyond the current four-year limit that has ostensibly been put in place by the original language of Decree 152.  Under the amendment, such individuals applying for a new work permit (for the same position and title) may also benefit from relaxed documentary requirements, including the submission of previously issued Work Permits or WPECs as proof of expertise (rather than having to again provide, for example, their educational degree certificates and other proof of previous experience). Thus, other documentary requirements (including work experience letters, degrees and police clearance certificates) may also be relaxed in such cases.

Other changes

• • Jurisdiction over work permit and work-permit related matters. The amendment confirms that MOLISA and the local DOLISAs are the only authorities in charge of receiving, approving, issuing and re-issuing JPA, work permit, and WPEC applications (as well as receiving the requisite foreign labor reports). In contrast, for those Industrial Zone authorities that had been administering such applications previously, these should now revert to the local DOLISA.
  • Form of passport to be submitted. The amendment confirms that only a copy of the applicant’s passport, certified by the company, can be accepted. Previously, the passport was required to be notarized (if the applicant was already in Vietnam) or legalized (if abroad) for the work permit application process.

• • Due to the increased workloads for MOLISA and the DOLISAs, applicants in the Industrial Zones may face additional delays in the application process (due to the increased workloads).
  • Companies can now simply certify a scanned copy of the passport, which should be accepted in lieu of a notarized or legalized copy. This was also temporarily accepted during the Resolution 105 period.