Employee Income Tax

In Malaysia, the income tax system operates on a progressive scale, meaning different portions of income are taxed at different rates ranging from 0% to 30%. Individuals earning an annual salary of below MYR 5,000 are exempt, while those earning over MYR 2,000,000 are taxed at the highest rate of 30%.

Income Tax

• 0% 0 MYR – 5,000 MYR
• 1% 5,001 MYR – 20,000 MYR
• 3% 20,001 MYR – 35,000 MYR
• 8% 35,001 MYR – 50,000 MYR
• 13% 50,001 MYR – 70,000 MYR
• 21% 70,001 MYR – 100,000 MYR
• 24% 100,001 MYR – 250,000 MYR
• 24.5% 250,001 MYR – 400,000 MYR
• 25% 400,001 MYR – 600,000 MYR
• 26% 600,001 MYR – 1,000,000 MYR
• 28% 1,000,001 MYR – 2,000,000 MYR
• 30% 2,000,001 MYR and over

Visa

Malaysia offers several categories of work visas, commonly referred to as “work passes.” The Employment Pass is the most common, issued to international individuals working in specialized roles for Malaysian companies. Employers must obtain approval from the Expatriate Committee or a regulatory agency to secure this pass, which typically lasts 1 to 5 years and is renewable.

The Temporary Employment Pass has two subcategories: the Foreign Worker pass and the Foreign Domestic Helper pass, both valid for up to two years. The Professional Visit Pass is for individuals employed by international companies who temporarily work in Malaysia for up to 12 months. Additionally, there is the Social Visit Pass, also known as “PLS@XPATS,” which allows professionals to work in Malaysia for short periods of up to 30 days.

Visa types

Malaysia offers several types of work visas and permits for foreign nationals seeking employment in the country. Here are some of the main types:

Types of Work Visas

• Employment pass
• Temporary employment pass
• Professional visit pass
• Social visit pass

Background check

In Malaysia, visa-related background checks for expatriates typically involve verifying the individual’s visa status as part of a broader employment background check. This process ensures that foreign workers have the necessary legal permissions to work in the country. While the primary focus is on verifying the authenticity and validity of the visa, employers may also conduct additional checks such as international criminal history to ensure compliance with local regulations and to assess the candidate’s overall suitability for the role.

Private health insurance

Private health insurance in Malaysia is designed to cover healthcare costs not fully covered by Social Security Organization (SOCSO), which is a compulsory program for work-related accidents and diseases. It provides additional benefits and flexibility in healthcare choices.

Team APAC providers

• SafetyWings
• Henner
• IMG/ ALC Global

Mandatory benefits

Statutory benefits include contributions to the Employees Provident Fund (EPF), where both employers and employees contribute a percentage of the employee’s salary, and registration with the Social Security Organization (SOCSO) for work-related injury and disability coverage. 

Mandatory benefits in Malaysia

• Employees Provident Fund (EPF)
• Social Security Organization (SOCSO)

Annual leave

Annual leave provisions vary based on the length of service. Workers with less than two years of service receive 8 days of leave per year of service. Those with more than two but less than five years of service are entitled to 12 days per year of service. For employees with five or more years of service, the entitlement increases to 16 days per year of service.

Sick leave

Employees are entitled to sick leave days that must be approved by a registered medical practitioner. The number of sick leave days varies based on the length of service: those employed for less than two years receive 14 days annually, those employed between two and five years receive 18 days, and those employed for five years or more receive 22 days. If hospitalization is required, an additional 60 days of sick leave are provided. For each day of sick leave, employees receive their regular pay rate.

Parental leave

There is no parental leave currently required by law.

Paternity leave

Married male employees may avail of paternity leave of up to  seven days (restricted to five confinements).

Maternity leave

Employees who are at least 90 calendar days into their employment in the last four months and are pregnant are eligible for 98 calendar days of fully paid leave, provided by the employer. This leave can begin 30 days before the expected delivery date, with the remaining days split into two periods following the birth. During this leave, employees will receive their full salary, which will be the responsibility of the employer to pay.

Termination process

The termination process involves several key steps. First, it is crucial to document the reason for termination and ensure that the justification is clear and well-founded. Next, formal notice must be provided, adhering to the required notice period or offering payment in lieu of notice if necessary. Following this, final compensation should be calculated, including any severance pay, accrued leave, and other applicable benefits.

Termination reasons

In Malaysia, the grounds for terminating an employee must be based on “just cause and excuse,” meaning there must be a valid reason for the termination. Common reasons include breach of contract, major misconduct (such as theft or sexual harassment), negligence, poor performance (provided the employee has been warned and given a chance to improve), retrenchment, expiration of a fixed-term contract, and closure of a business.

Employers must inform employees of the reason for termination in writing and follow a fair procedure, which includes providing notice and allowing the employee to respond. Additionally, Malaysian law prohibits terminating a local employee to hire a foreign worker, emphasizing the protection of local employment.

Notice period

Notification periods for termination of a contract are the same for employers and employees, whether those periods are specified in the employment contract or not. If there is no such specification in the contract, the required notification period is as follows:

• four weeks for employees with less than two years of service,
• six weeks for employees with two to five years of service, and
• eight weeks for employees with five or more years of service.

In lieu of providing the requisite notice, employers may make a payment equivalent to the amount of wages that would have been paid during the notice period.

In a case of misconduct, employers can dismiss the employee without notice, demote the employee, suspend the employee for up to two weeks without pay or impose a lesser punishment. The employer cannot take this action, however, without first engaging in “due inquiry.”

Severance Pay

In Malaysia, severance is generally not required, unless the employee earns less than 4,000 RM per month.

Also, in case of employees who are unfairly dismissed, meaning for reasons unrelated to their performance or conduct, are entitled to severance packages based on their length of service.

The compensation varies as follows: for up to two years of employment, employees receive 10 days of pay per year of service. For those employed between two and five years, the package increases to 15 days of pay per year. Employees with more than five years of service receive the highest rate, with 20 days of pay for each year worked.

Probation period

In Malaysia, a probationary period, typically between three to six months, is a common practice used by employers as a trial phase for new employees. It allows both parties to assess whether the employee is suitable for permanent employment and whether the company is the right fit for the employee. 

Probation Period days

• 90 days Minimum probation period
• 180 days Maximum probation period

Employee Income Tax

In New Zealand, individual income tax rates are progressive, meaning higher income earners pay higher tax rates. As of the latest information, the tax rates and brackets for the 2024-2025 tax year are as follows:

Income Tax

• 10.5% 0 NZD – 14,000 NZD
• 17.5% 14,001 NZD – 48,000 NZD
• 30% 48,001 NZD – 70,000 NZD
• 33% 70,001 NZD – 180,000 NZD
• 39% 180,001 NZD and over

Visa

Employees have multiple options for obtaining a New Zealand work visa, with several common types available. These are: the Accredited Employer Work Visa, the Skilled Migrant Category Resident Visa, the Straight to Residence Visa, the Post Study Work Visa, the Student and Trainee Work Visa, and the Working Holiday Visa. Each of these visas caters to different needs and circumstances, providing a range of pathways for individuals seeking to work in New Zealand.

Visa types

• Accredited Employer Work Visa
• Skilled Migrant Category Resident Visa
• Straight to Residence Visa
• Post Study Work Visa
• Student and Trainee Work Visa
• Working Holiday Visa

Compliance documents types

• Passport or travel document
• 2 passport-sized color photographs
• Medical and chest x-ray, health questionnaire, and medical exam
• Character questionnaire and police certificates from the individual’s country of origin as well as any place they’ve lived for at least 5 years since they turned 17.

Background check

Background checks are an essential part of the work visa application process in New Zealand, ensuring that applicants meet character and identity requirements. These checks typically include police certificates to confirm the absence of a criminal record, which must be obtained from the applicant’s country of origin or any country where they have lived for at least five years since turning 17. Written consent is required for criminal record checks, and privacy laws regulate the use of such information. Employers may also verify employment history, education credentials, and conduct medical screenings if relevant to the job. Additional checks, such as credit history or social media reviews, are permissible only when directly related to the job’s responsibilities. Providing false or misleading information during the visa application process can lead to rejection. All background checks must comply with New Zealand’s legal and privacy standards to ensure fairness and transparency.

Private health insurance

Private health insurance in New Zealand is designed to cover healthcare costs not fully covered by the country’s public healthcare system. It provides additional benefits and flexibility in healthcare choices.

Team APAC providers

• SafetyWings
• Henner
• IMG/ ALC Global

Mandatory benefits

In New Zealand, employers are legally required to provide several mandatory employee benefits. These include paid leave, which encompasses annual leave, public and alternative holidays, parental leave, sick leave, and bereavement leave. Another mandatory benefit is the Accident Compensation Corporation (ACC) levy, which provides insurance coverage for accidental injuries both at work and outside the workplace. Additionally, employers must contribute to Kiwisaver, a voluntary retirement savings scheme, by automatically enrolling eligible new employees and contributing a minimum of 3% of the employee’s gross salary. These benefits ensure that employees have financial security and support in various aspects of their lives.

Mandatory benefits in New Zealand

• Paid leaves
• Accident Compensation Corporation (ACC)
• Kiwisaver

Annual leave

All employees are entitled to at least four weeks’ paid annual vacation, awarded on the first and subsequent anniversaries of starting work. Accrued leave can only be converted into cash in limited circumstances. Employees must be given the opportunity to take at least two of their four weeks’ vacation entitlement continuously if they wish to do so.

Sick leave

The Holidays Act 2003 provides employees a minimum of five days’ paid sick leave a year after the first six months of continuous employment and an additional five days paid sick leave after each subsequent 12 month period. Additionally, any unused sick leave can be carried over to the following 12-month period, allowing for a maximum accumulation of up to 20 sick days.

Personal/Carer’s leave/ Maternity leave

In New Zealand, what is often referred to as maternity leave is actually called Primary Carer Leave. This leave is available to employees who become the primary care provider for children under six. To qualify, employees typically need to have worked at least 10 hours a week for 12 months. They are entitled to up to 26 weeks of leave, during which they receive a payment capped at NZD 661.12 gross per week, funded by the government. Employers may choose to supplement this amount to match the employee’s full salary.

Paternity leave

Employees are entitled to 26 weeks of parental leave. Both parents can decide how to distribute the time off. Either parent can take parental leave. Parental leave is unpaid.

Paternity leave

Employees are entitled to a period of unpaid paternity leave, which can range from one to two weeks, depending on their length of service. This leave can be taken within a specific timeframe, starting from 21 days before the expected birth date and ending 21 days after. For those who have worked for at least six months, averaging a minimum of 10 hours per week, one week of leave is available. Employees who have been with the company for 12 months or more, also averaging at least 10 hours per week, qualify for a longer period of two weeks.

Family & domestic violence leave

Family violence leave is mandatory in New Zealand for employers to provide to eligible employees. The Domestic Violence – Victims’ Protection Act 2018 requires employers to offer up to 10 days of paid family violence leave annually to employees who experience family violence, including those who need to support a child affected by such violence. Employers are legally obligated to provide this leave and cannot discriminate against employees for taking it. Additionally, employees can request flexible working arrangements for up to two months to support their safety and well-being.

Termination process

In cases of serious misconduct, an employer may terminate an employee without notice and without paying out the notice period. “Serious misconduct” must undermine or destroy the relationship of trust and confidence that exists between the employer and the employee.

When dismissing an employee for serious misconduct, the employer must still follow a fair process, and the employee must be given a chance to both hear and respond to the allegations of misconduct.

Termination reasons

Grounds for dismissal include serious misconduct, which involves behavior that undermines the employer’s trust and can lead to immediate termination without notice. Repeated misconduct, where an employee consistently fails to meet workplace standards despite warnings, is another valid reason. Performance issues may also justify dismissal if the employee fails to meet job expectations despite receiving support and opportunities to improve. Redundancy occurs when a role becomes unnecessary due to business changes, such as technological advancements or financial constraints. Incapacity, often due to health issues, can lead to dismissal if the employee is unable to perform their duties. Incompatibility arises when an employee’s personal characteristics or behavior hinder their ability to work effectively within the organization. Lastly, during a trial period, employers may dismiss employees for unsatisfactory performance or other valid reasons, often providing verbal explanations rather than written ones.

Notice period

Employers in New Zealand are required to provide notice in accordance with the terms outlined in the employment agreement. Typically, for many roles, a notice period of four weeks is considered standard and fair.

Severance Pay

Unless covered in the individual or collective employment agreement, an employer is under no obligation to pay an employee severance beyond payment of all wages due at termination and compensation for any unused vacation.

Probation period

In New Zealand, a probationary period is a common practice used by employers to assess new employees’ suitability for a role. The period must include a fair assessment of the employee in writing. A probation period of three months is common.

Probation Period days

• 90 days Minimum probation period
• 180 days Maximum probation period

Employee Income Tax

The individual income tax ranges from 0% to 35%. Income tax is calculated according to progressive rates.

Income Tax

• 0% 0 PHP to 250,000 PHP
• 15% Above 250,000 PHP – 400,000 PHP
• 22,500 PHP + 20% in excess of 400,000 PHP
  Above 400,000 PHP – 800,000 PHP
• 102,500 PHP + 25% in excess of 800,000 PHP 
  Above 800,000 PHP – 2,000,000 PHP
• 402,500 PHP + 30% in excess of 2,000,000 PHP 
  Above 2,000,000 PHP – 8,000,000 PHP
• 2,202,500 PHP + 35% in excess of 8,000,000 PHP
  Above 8,000,000 PHP

Visa

A foreigner also needs a work visa, such as the 9(g) Pre-Arranged Employment Visa, which is tied to a Philippine-based employer.

Visa types

• 9(g) Pre-Arranged Employee Commercial Visa
• Temporary Visitor’s Visa for Business Purposes (9A)
• Special Non-Immigrant Visa: Includes various special visas like those under E.O. 226, which are issued for specific purposes such as employment in special economic zone

Compliance documents

In the Philippines, visa-related background checks typically involve obtaining a police clearance or an NBI (National Bureau of Investigation) Clearance.

Foreign nationals applying for a visa may need to provide a criminal record or police clearance from their home country. The Bureau of Immigration (BI) also conducts checks to ensure applicants do not have derogatory records that could affect their eligibility for a visa. These background checks are crucial for ensuring compliance with immigration laws and regulations in the Philippines.

Types of Work Permits

• Alien Employment Permit (AEP): Required for all foreign nationals seeking long-term employment in the Philippines. It is issued by the Department of Labor and Employment (DOLE)
• Special Work Permit (SWP): For short-term employment (up to six months) and does not require an employment contract. It is issued by the Bureau of Immigration (BI)
• Provisional Work Permit (PWP): A temporary permit issued while the work visa is being processed. It is valid for three months and renewable
• Special Temporary Permit (STP): Required for foreign nationals practicing regulated professions in the Philippines, issued by the Professional Regulation Commission (PRC)

Background check

In the Philippines, visa-related background checks typically involve obtaining a police clearance or an NBI (National Bureau of Investigation) Clearance. 

Additionally, foreign nationals applying for a visa may need to provide a criminal record or police clearance from their home country. The Bureau of Immigration (BI) also conducts checks to ensure applicants do not have derogatory records that could affect their eligibility for a visa. These background checks are crucial for ensuring compliance with immigration laws and regulations in the Philippines

Private health insurance

Private health insurance in the Philippines is designed to cover healthcare costs not fully covered by PhilHealth, the country’s public healthcare system. It provides additional benefits and flexibility in healthcare choices.

Team APAC providers

We offers multiple health insurance options, allowing customers to choose between International Health Insurance, providing worldwide coverage on a pay-and-claim basis, or a Local Health Insurance, which offers a cashless access to treatment within the provider’s network. We offer the flexibility to cover either the employee only (single option) or the employee and their dependents (family option), tailored to meet the specific needs of your team.

• SafetyWings
• Henner
• IMG/ ALC Global

Mandatory benefits

Mandatory benefits in the Philippines include contributions to government programs such as the Social Security System (SSS), Philippine Health Insurance Corporation (PhilHealth), and Home Development Mutual Fund (Pag-IBIG). Employees are also entitled to paid leaves like service incentive leave, maternity/paternity leave, and holiday pay.

Mandatory benefits in Philippines

• Social Security System (SSS)
• Philippine Health Insurance Corporation (PhilHealth)
• Home Development Mutual Fund (HDMF, otherwise known as Pag-IBIG)

Annual leave

Full-time employees are entitled to 5 days of paid time off (PTO) a year. PTO accrues monthly at 0.42 days per month and begins accruing from their start-date. If holidays are not used by the end of the year, employees can receive a payment. Part-time employees are not entitled to leave.

It is, however, common practice in the Philippines to provide a greater number of leaves ranging from 10-15 annual leaves.

Sick leave

Employees in the Philippines are not entitled to sick leave in addition to their vacation allowance (PTO). In practice, however, companies provide 5-15 sick leaves per year.

Parental leave

There is no specific statutory requirement for parental leave in the Philippines. However, employees may be entitled to maternity leave and paternity leave. 

Married male employees are entitled to seven calendar days of paid paternity leave.. The employee will receive 100% of their average salary during this period, and the employer will be responsible for this pay. The employee can extend leave unpaid.

Additionally, single parents can apply to the Solo Parent Policy.

Maternity leave

Pregnant employees are entitled to 105 days of paid leave. An additional 15 days of paid leave will be granted if the employee qualifies as a solo parent. The employee will receive 100% of their average salary during this period, and Social Security will be responsible for this pay.

The employee can extend leave an additional 30 days unpaid.

Family & domestic violence leave

Republic Act No. 9262, also known as the Anti-Violence Against Women and Their Children (VAWC) Act of 2004 grants female employees who are victims of violence the right to take a paid leave of absence for up to ten (10) working days. The purpose of this leave is to allow victims to address medical, legal, and personal concerns related to the abuse without losing their income.

Termination process

Terminations in the Philippines  are complex and do not allow for at-will employment outside of the probation period. Employers must have just cause to terminate an employee. Compliant terminations can occur in several ways.

They can be voluntary, initiated by the employee, or by mutual agreement between the employer and employee. Employers can also unilaterally terminate employment during the probation period, based on objective grounds, or for disciplinary reasons.

Additionally, terminations can occur due to performance issues if an employee is deemed unsuitable for the job. Lastly, employment can end naturally with the expiration of a contract.

Termination reasons

In the Philippines, just causes for terminating an employee’s services include serious misconduct or wilful disobedience of lawful orders, gross and habitual neglect of duties, fraud or wilful breach of trust, and commission of a crime or offense against the employer or their immediate family.

Additionally, other causes analogous to these may also be considered just causes, such as theft against a third party if proven by substantial evidence, gross incompetence, failure to meet occupational standards, or severe failure to comply with company rules.

Termination for just causes requires adherence to due process, which includes serving a written notice specifying the grounds for termination, conducting a hearing, and issuing a final written notice of termination.

Lastly, redundancy is a valid reason for termination if a job is no longer needed due to operational changes, technological advancements, or business restructuring.

Notice period

The minimum notice period for employees is thirty (30 days, which may be increased depending on one’s position pursuant to a written contract.

Severance Pay

Separation pay or severance pay in the Philippines is a statutory benefit provided to employees who are terminated due to authorized causes under the Labor Code.

These causes include redundancy, retrenchment, installation of labor-saving devices, closure or cessation of business not due to serious financial losses, and health-related issues that prevent continued employment. The amount is typically calculated as either one month’s salary or one-half month’s salary for every year of service, whichever is higher.

The benefit aims to provide financial support during unemployment and is based on the employee’s most recent salary rate, with any service of at least six months rounded up to a full year. Separation pay is exempt from income tax if the termination is due to reasons beyond the employee’s control, such as redundancy or illness.

Employees terminated for just causes, such as serious misconduct or willful disobedience, are not entitled to separation pay.

Probation period

In the Philippines, a probationary period is a common practice used by employers to assess new employees’ suitability for a role. This period is not mandatory but is often included in employment contracts to provide both parties an opportunity to evaluate their compatibility.

Probation Period days

• 90 days Minimum probation period
• 180 days Maximum probation period

Employee Income Tax

Resident individuals are taxed on a progressive scale ranging from 5% to 35% on their worldwide employment income. Non-resident individuals face a flat tax rate of 20% on most income derived in Vietnam.

Income Tax

• 5% 0 VND – 60 milion VND
• 10% 60 milion VND – 120 milion VND
• 15% 120 milion VND – 216 milion VND
• 20% 216 milion VND – 384 milion VND
• 25% 384 milion VND – 624 milion VND
• 30% 624 milion VND – 960 milion VND
• 35% 960 milion VND and over

Visa

Employers are required to justify hiring foreign workers by demonstrating that local talent cannot fulfill the role, often for specialized positions like managers, executives, experts, or technicians.

The company must announce recruitment for this position to job seekers in Vietnam via an online portal or a local newspaper. If there are no qualified Vietnamese applicants within 30 days, an international worker may be offered the job. A written document, establishing that an announcement has been posted or published, must be submitted in the process of applying for an LD work visa.

The application process involves submitting documentation such as health certificates, criminal records, and proof of qualifications to the Department of Labor, Invalids, and Social Affairs (DoLISA).

Visa types

Vietnam offers several types of work visas and permits for foreign nationals seeking employment in the country. Here are some of the main types:

• HN visas – intended for meetings and conferences
• DT visas – intended for investors
• DN visas – intended for individuals working with Vietnam businesses
• DH visas – intended for students and interns
• LV1-LV2 visas – intended for individuals working with authorities in Vietnam
• LD visas – intended for international workers

Compliance documents types

• A completed application form.
• A valid passport and a notarized copy of it.
• Health certificates and medical records of the applicant.
• 3 passport-sized photos taken within the last year.
• A criminal record to prove the applicant has no history of criminal activity that would prevent them from working in Vietnam.
• Copies of any relevant professional certificates

Background check

In Vietnam, background checks are a mandatory part of the work permit application process for foreign employees. Employers must ensure that the applicant has no criminal record, both in Vietnam and their home country.

The criminal record check, officially known as the Judicial Record Card, is issued by the provincial Department of Justice where the applicant resides or, for those who have lived in Vietnam, by the National Center for Judicial Records. Employers must also verify the applicant’s health condition, educational qualifications, and professional experience, ensuring compliance with Vietnamese labor laws.

Written consent from the candidate is required before conducting any background checks, and employers must adhere to data protection regulations, especially when handling sensitive personal data such as health records.

Private health insurance

Private health insurance in Vietnam is designed to cover healthcare costs not fully covered by statutory health insurance.

Team APAC providers

• SafetyWings
• Henner
• IMG/ ALC Global

Mandatory benefits

Statutory benefits include health insurance, social insurance, unemployment insurance, annual leave.

Mandatory benefits in Vietnam

• Health Insurance
• Social Insurance 
• Accident Insurance 
• Unemployment Insurance 
• Annual Leave
• Maternity Leave
• Paternity Leave

Annual leave

An employee is entitled to 12 days of annual leave with full pay after one year with an employer. The number of days of annual leave increases at the rate of one for every additional five years with an employer. An employee with less than one year with an employer receives leave in proportion to the duration of the employment. Wages for the leave time are paid in advance.

Sick leave

Employees are eligible for paid sick leave for a maximum of 30 days, during which they will receive 75% of their salary, funded by Social Security. Extensions to the leave period may be granted, but these are evaluated individually based on the employee’s specific circumstances.

Parental leave

Parental leave in Vietnam is available for childcare and entitles employees to up to 20 working days of parental leave per year until the child reaches the age of 3 and thereafter up to 15 working days per year until the child reaches the age of 7.

Vietnamese nationals will have this leave paid by the Social Insurance Authority at the rate of 75% of the salary in the month preceding the start of the leave.

Maternity leave

Pregnant employees who have paid into the social security system for a minimum of three months are eligible for six months of paid maternity leave. This includes the option to take two weeks of leave prior to the child’s birth.

During this period, the employee is entitled to receive 100% of their average salary, calculated from their social insurance contributions in the previous six months. The payment for this leave will be managed and disbursed by Social Security.

Paternity leave

Fathers who have completed a minimum of three months of contributions to the social security system are eligible for five days of paid paternity leave. During this leave, the employee will receive their full salary, which will be covered by the Social Security fund.

Family & domestic violence leave

Currently, the Law on Prevention and Combat against Domestic Violence (enacted in 2022) does not mandate  domestic violence leave.

Termination process

The termination process involves several key steps and considerations. The process requires adherence to procedural steps, including providing adequate notice periods and ensuring compliance with legal obligations to avoid wrongful termination claims.

Termination reasons

Employers can terminate contracts based on specific statutory grounds, such as the expiration of the labor contract, non-recovery from an illness or accident after a prescribed period, mutual agreement, or disciplinary actions like dismissal. An employer may dismiss an employee if the employee consistently fails to perform the duties of the job;  has committed theft or embezzlement, disclosed business or technological secrets, or committed another act that causes serious damage to the interests of the employer; or is absent from work without a valid excuse for five days in a month or 20 days in a year. Valid grounds for termination also include closure or contraction of the business.

Notice period

In Vietnam, except for dismissals due to criminal conduct, repeat offenses, or repeated absences, an employer must give prior notice three days in advance for employees bound by seasonal contracts (or contracts lasting less than a year); 30 days for for contracts lasting between one to three years; or 45 days for indefinite labor contracts.

Severance Pay

If an employer is found to have improperly dismissed an employee, the employer must reinstate the employee and pay back wages plus at least two months’ salary. If the employee does not want to return to work, the employer must pay back wages, the two months’ salary, and one month’s wages for every year of service.

Probation period

In Vietnam, probation periods are not mandatory. The parties, however, may agree on a period from six to 60 days, depending on the skill level required for the position. Employees must be paid at least 85% of their normal wages during the probation period and should be notified of the probation outcome at least three days before the test period ends.

Probation Period days

• 6 days Minimum probation period
• 60 days Maximum probation period