Vietnam is a growing hiring market, but a foreign company cannot employ staff directly without a licensed local entity, and 2025–2026 brought major changes. A new Social Insurance Law took effect on 1 July 2025. On 1 January 2026, regional minimum wages rose by about 7.2% and the Personal Data Protection Law came into force. A new 5-bracket income tax schedule (5–35%) applies for the 2026 tax year under Law 109/2025, with higher personal and dependant deductions. From 1 July 2026, the social and health insurance salary cap rose to VND 50.6 million a month. A new public holiday, Vietnam Culture Day, falls on 24 November 2026.
Currency: Vietnamese Dong (₫ VND)
Language: Vietnamese (official); English common in foreign-invested companies
Regulatory Authority: Ministry of Home Affairs (labour), Vietnam Social Security, the Tax Department (Ministry of Finance), provincial People’s Committees (work permits) and the Ministry of Public Security (data protection)
Last updated: October 2026
Four regional rates from 1 January 2026: VND 5,310,000 a month in Region I (urban Hanoi, Ho Chi Minh City and other major cities), down to VND 3,700,000 in Region IV. Merged areas apply the highest former rate.
Written contracts are required for work of 1 month or longer, usually in Vietnamese or bilingual. Definite-term contracts run up to 36 months and can be renewed only once; the next contract must be indefinite.
One probation per job: up to 180 days for managers, 60 days for roles needing a college degree, 30 days for technical roles and 6 working days for other work. Pay must be at least 85% of salary.
About 23.5% on top of gross salary for Vietnamese staff (21.5% insurance plus a 2% trade union fee), and about 22.5% for foreign staff. The effective rate is lower above the salary caps.
12 working days of annual leave after 12 months, plus 1 day for every 5 years of service. 11 public holidays, plus Vietnam Culture Day on 24 November from 2026. Social Insurance pays sick leave at 75%.
Up to 8 hours a day and 48 hours a week. Many foreign-invested companies use a 40-hour week.
Social insurance 17.5%, accident insurance 0.5%, health insurance 3% and unemployment insurance 1% (Vietnamese staff only), on salary up to VND 50.6 million a month from 1 July 2026. Plus a 2% trade union fee.
Residents pay 5–35% across 5 brackets for the 2026 tax year, after a personal deduction of VND 15.5 million a month and VND 6.2 million per dependant. Non-residents pay a flat 20%.
150% on normal days, 200% on weekly rest days and 300% on public holidays. Overtime needs consent and is capped at 40 hours a month and 200 hours a year (300 in some sectors).
Notice is 45 days for indefinite contracts, 30 days for 12–36 month contracts and 3 working days for shorter ones. Severance is half a month's salary per year of service, excluding periods covered by unemployment insurance.
All amounts are due within 14 working days of termination, or up to 30 days in specified cases such as restructuring. The employer must also complete the social insurance book and return documents.
Law 91/2025 applies from 1 January 2026. Employers need purpose-specific consent or another legal basis, must file a data impact assessment within 60 days, and report breaches within 72 hours. Fines reach VND 3 billion.
2025–2026 updates
Use a written contract for any role lasting 1 month or more; e-contracts are valid. Contracts are in Vietnamese, and bilingual versions are standard for foreign staff. A definite-term contract can last up to 36 months and be renewed only once. Foreign employees need a work permit or exemption from the provincial People’s Committee. Approval takes about 10 working days, and the permit lasts up to 2 years, renewable once.
Register with Vietnam Social Security and the tax authority before running payroll. Withhold employee insurance of 10.5% (9.5% for foreign staff) and income tax, and pay employer insurance plus the 2% trade union fee. The new tax brackets apply for the whole 2026 tax year, and early-2026 withholding is reconciled at year-end finalisation, so confirm withholding timing and the filing cycle with your tax office.
Employees earn 12 working days of annual leave a year, plus 1 day per 5 years of service. Social Insurance pays sick leave at 75% of the insured salary and maternity leave of 6 months at 100%. Fathers get 5 to 14 working days of paternity leave, taken within 60 days of the birth. A Tet bonus of about one month’s pay is customary and becomes binding if it is in the contract or company rules.
An employer can end a contract only on grounds set out in the Labour Code, with notice of 45, 30 or 3 working days depending on contract type. Dismissal as a disciplinary measure needs a formal procedure. Pay severance of half a month per year of service, or 1 month per year (minimum 2 months) for restructuring. Pregnant employees and parents of babies under 12 months are protected. Settle final pay within 14 working days.
Under the Personal Data Protection Law, get purpose-specific consent or rely on another legal basis, appoint a data protection person or provider, and file a data impact assessment within 60 days of starting processing. Report breaches within 72 hours and delete data from unsuccessful applicants unless they consent. Register internal labour rules once you have 10 or more employees, and file six-monthly and annual labour reports.
Download the full Vietnam Payroll & Employment Guide 2026 (PDF)
For detailed hiring information, customised employment guidance or support with your Vietnam hiring, please reach out to our team. We provide compliant employment contracts, payroll processing and tax remittance, social security registration and reporting, benefits administration, and onboarding and offboarding support. See our EOR pricing: flat from $349 per employee, per month.
FAQ
Yes. A foreign company cannot employ staff directly, but an Employer of Record such as StratEdge Global becomes the legal employer and handles contracts, payroll, social insurance, tax withholding and compliance, while you direct the day-to-day work.
Yes, if they hold a work permit and a contract of 12 months or more. They pay 9.5% and the employer pays 20.5% plus the 2% trade union fee. Foreign staff are not covered by unemployment insurance, and intra-company transferees are exempt.
Not by law. It is a near-universal custom, and it becomes binding once it is written into the contract, internal rules or a collective agreement.
About 3 weeks. Post a recruitment notice at least 5 days before applying, file 10–60 days before the start date, and expect approval within 10 working days. Permits last up to 2 years and can be renewed once.
