Details on Implementation of New Labor Law Expected This Week

IMPACT – High

What is the change? A new labor law is set to go into effect on Nov. 1. However, many details about the implementation of the new law have not yet been made clear. More information is expected this week.

What does the change mean? The new law may enact significant changes for intracompany transferees and short-term work permits, as well as increase regulations for employers of foreign workers.

• Implementation timeframe: Nov. 1.
• Visas/permits affected: Work authorization.
• Who is affected: Foreign nationals working in Vietnam.
• Impact on processing times: There may be processing delays as the new law begins to be implemented.
• Business impact: Unknown.
• Next steps: Await updates from BAL.

Background: The Ministry of Labour, Invalids and Social Affairs (MOLISA) is expected to release a circular this week that will make the implementation of Decree 102 more clear in preparation for its enactment on Nov. 1. BAL’s current interpretation of the law suggests that its most important changes for clients may include:

• Many intracompany transferees (ICTs) may become exempt from work permits.
• Foreign nationals working in Vietnam for less than three months may become required to obtain a work permit, unless they qualify for an exemption. Previously, all employees in this category were exempt.
• Employers will be required to obtain approval letters from the People’s Committee before hiring foreign nationals in specific positions, for initial work permits or for work permit renewals.

BAL analysis: Decree 102 is likely to present both significant benefits and significant disadvantages for clients. If the law is implemented as is currently indicated, it could become much easier to use ICTs, but equally more difficult to hire foreign nationals for short-term assignments. It is difficult to forecast how much more time will be required for immigration processes. BAL will continue to provide the latest updates and analysis on the situation.

This alert has been provided by the BAL Global Practice group and our network provider located in Vietnam. For additional information, please contact GlobalVisaGroup@bal.com.

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