Vietnam: Proposed Amendment to Labour Decree 152 Affecting Foreign Nationals Forthcoming; Comment Period Open

Definition and eligibility revisions

• ICT definition narrowing. The government is potentially narrowing the definition of Intra-Company Transfers (ICT) to be in line with the World Trade Organization definition.
• 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 proposed amendment removes "or equivalent" from the degree requirement and emphasizes the relevancy of the work experience. Under current practice, this has been interpreted by the adjudicating officers to strictly require that the applicant’s field of study in their degree certificate specifically match 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 proposed amendment removes the specification of the training field and emphasizes the relevancy of the work experience to the job position/job assignment in Vietnam.

While applicants may seemingly benefit from the clarity of the new definition in terms of qualifications, it is possible that the government will also tighten the eligibility criteria for local hires by continuing to exercise their discretion on the definitions set in the amendment. The current draft remains vague on whether the test of “relevancy” applies only to the applicant’s previous work experience or to both the previous work experience and the degree certificate. 

• Changes to JPA submission timing. The government is modifying the timing for JPA submissions. Where it is only required to be at least 30 days prior the new rule requires submissions to be made at least 30 days prior and not more than 180 days from the date on which foreign workers are expected to be employed.
• Clarification of JPA validity. The government will allow the use of the JPA for up to 180 days from its approval. Currently, applicants may use the JPA so long as it remains valid.
• Expansion of JPA exemptions. The government is expanding the exemptions for the JPA and extending 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.

• It is likely that the authorities implemented the parameters around timing of the JPA submissions to help manage their caseloads. Applicants and companies will similarly benefit from these clarifications, as the foreign labor needs of the company may only be apparent closer to the anticipated start dates.
• For foreign nationals married to Vietnamese spouses, the proposed changes may represent a more formal codification of their requirements. Under the existing regime, a work notification is simply required 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 run, this could potentially benefit such individuals as there would be a more formal status document (i.e., written certificate) issued by the government.
• The potential confirmation that Form 1 should be used for all new JPA applications would 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).

• The government may start accepting alternative documents such as Certificates of Completion and Certificates of Graduation in lieu of Degree Certificates for Work Permit applications
• Additionally, government authorities may start requiring additional documentary proof for Managers, and Executives for Work permit applications, including potentially their nomination in the Company’s Charter.
• For Experts, the draft Amendment proposes 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 by conferred) may benefit from the relaxation of this requirement by being able to submit alternative documents such as certificates of graduation or certificates of completion.
• Conversely, for Managers and Executives, the new requirements are potentially burdensome and onerous and may rule out the Manager or Executive category for many applicants.
• For the Expert category, the allowance of previously issued Work Permits/WPECs as proof of relevant experience would be a welcome change (as, currently, they are not considered).

• 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 application falls under MOLISA’s purview). Under the proposed amendment, companies would need to report to the local provincial DOLISA (where the individual will be working) on each MOLISA-issued Work Permit or WPEC, within 30 days of issuance.

• The new WPEC requirement will 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 DOLISA (and only applies to those issued by MOLISA itself).

• Requirement to report all work locations. The labour authorities may start requiring 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/cities, MOLISA (rather than the local departments of labour or DOLISAs) may take jurisdiction over such cases.
• Reissuance of work permit for enterprise name changes. On top of existing triggers for the reissuance of work permits, the proposed 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 maximum validity. The proposed 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 proposed 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 proposed 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).