LAWFUL EMPLOYEE DISMISSAL IN VIETNAM: COMMON MISTAKES EMPLOYERS OFTEN MAKE

This is the most common and costly procedural error.

Article 70 of Decree No. 145/2020/ND-CP requires employers to organize a labor disciplinary meeting before issuing a dismissal decision. The meeting must include:

• The employer or its authorized representative;
• The employee representative organization of which the employee is a member;
• The employee (who may be accompanied by a representative or defender).

Practical Example

A trading company in Ho Chi Minh City dismissed a warehouse employee for theft supported by CCTV footage. However, the company failed to notify the grassroots trade union and conducted the meeting with only management personnel.

As a result, the court declared the dismissal invalid due to procedural violations, ordered reinstatement of the employee, and required the employer to pay compensation equivalent to nearly six months’ salary.

Mistake #2: Failure to Provide Proper Notice of the Disciplinary Meeting

Under Vietnamese labor law, notices of disciplinary meetings must be sent to all required participants at least five working days before the meeting date.

Many employers either provide last-minute notice or communicate verbally without retaining proof of delivery.

Consequences

If the employee is absent for a valid reason and the employer proceeds with the meeting and dismissal, the entire disciplinary process may be declared invalid.

Mistake #3: Dismissing Employees Belonging to Protected Groups

Many employers fail to verify whether an employee falls within a legally protected category before issuing a dismissal decision.

Vietnamese labor law strictly prohibits dismissal of:

• Pregnant employees;
• Employees on maternity leave;
• Employees receiving treatment for occupational diseases or work-related injuries.

This prohibition applies even when the employee has committed disciplinary violations.

Practical Example

A manufacturing company dismissed a female employee for repeatedly failing to meet performance targets. After receiving the dismissal decision, she presented medical documentation confirming that she was eight weeks pregnant.

The employer was forced to revoke the dismissal decision, reinstate the employee, compensate her for losses, and faced potential administrative penalties.

Mistake #4: Applying Unregistered or Uncommunicated Internal Labor Regulations

A dismissal is lawful only if the misconduct is clearly stipulated in:

1. The company’s internal labor regulations; and
2. Labor regulations that have been duly registered with the competent labor authority.

Many employers rely on outdated regulations, fail to update them, or cannot prove that employees were informed of the rules.

Compliance Checklist

Ask yourself:

• Have your internal labor regulations been registered with the competent labor authority?
• Have employees signed acknowledgments confirming receipt and understanding of the regulations?

If the answer is no, the dismissal may be vulnerable to legal challenge.

Mistake #5: Confusing Unilateral Termination with Disciplinary Dismissal

This is a purely legal mistake but one with serious consequences.

For example, an employer wishes to terminate an employee because the employee consistently fails to meet job performance requirements—a lawful ground for unilateral termination under Article 36.

However, the employer mistakenly issues a “dismissal decision” instead.

The two procedures involve entirely different:

• Legal grounds;
• Procedural requirements;
• Legal consequences.

Golden Rule

Before making any decision related to ending an employment relationship, clearly identify whether the case involves:

• Unilateral termination of the employment contract, or
• Labor disciplinary dismissal.

Using the wrong legal basis may invalidate the entire process.

Step-by-Step Lawful Dismissal Procedure in Vietnam

To lawfully dismiss an employee under Article 125 of the Vietnam Labor Code 2019, employers should follow these steps:

Step 1: Identify the Violation and Legal Basis

Verify that the employee’s conduct falls within both:

• The dismissal grounds listed in Article 125; and
• The company’s registered internal labor regulations.

If not, dismissal is not legally permissible.

Step 2: Collect and Preserve Evidence

Prepare a violation report immediately upon discovering the misconduct.

Retain supporting evidence such as:

• CCTV footage;
• System logs;
• Emails;
• Documents;
• Witness statements.

Step 3: Send Meeting Notices

Provide written notice to:

• The employee;
• The grassroots trade union;
• Other required participants.

The notice must be delivered at least five working days before the meeting.

Maintain proof of delivery, including acknowledgment receipts, email confirmations, or postal records.

Step 4: Conduct the Disciplinary Meeting

The meeting must comply with Article 70 of Decree No. 145/2020/ND-CP.

A detailed meeting record must be prepared and signed by all attendees.

If the employee fails to attend, the reason must be documented and the meeting may need to be reconvened according to statutory requirements.

Step 5: Issue the Dismissal Decision

The written decision should clearly state:

• Employee information;
• Grounds for dismissal;
• Relevant legal provisions and internal regulations;
• Effective date of dismissal.

The employer should also retain proof that the employee received the decision.

Step 6: Settle Outstanding Payments

Within 14 working days from the termination date, the employer must pay:

• Outstanding salary;
• Unused annual leave entitlements;
• Other contractual benefits.

Employees dismissed due to their own misconduct are generally not entitled to severance allowance.

Legal Consequences of Unlawful Dismissal

Under Article 41 of the Vietnam Labor Code 2019, an unlawful dismissal may result in the following consequences:

• Reinstatement of the employee (unless the employee declines);
• Compensation equal to at least two months’ salary;
• Payment of wages for the entire period during which the employee was unable to work;
• Administrative penalties under Decree No. 12/2022/ND-CP.

In addition to legal liability, employers may suffer significant reputational damage. Labor disputes are increasingly discussed on social media, affecting employer branding and future recruitment efforts.

Practical Recommendations for Employers

Regularly Review and Update Internal Labor Regulations

Labor regulations should be updated whenever there are:

• Changes in labor laws;
• Organizational restructuring;
• Significant policy changes.

Any amendment must be registered with the competent authority and communicated to employees.

Train HR Personnel and Managers

Human Resources staff and department managers should receive regular training on labor disciplinary procedures.

Proper training serves as the first line of defense against costly procedural mistakes.

Seek Legal Advice Before Taking Action

For complex situations involving:

• Senior employees;
• Protected employees;
• Trade secret violations;
• High-risk labor disputes,

employers should consult an experienced labor lawyer before proceeding.

Maintain Complete Disciplinary Records

All disciplinary documents should be retained for at least three years, including:

• Violation reports;
• Meeting notices;
• Meeting minutes;
• Dismissal decisions;
• Delivery confirmations.

Conclusion

Employee dismissal in Vietnam is far more than an internal management decision. It is a legal process that requires careful preparation, strict procedural compliance, and thorough documentation.

Employers that follow the correct legal procedures can significantly reduce the risk of labor disputes, financial liability, and reputational harm. More importantly, lawful and transparent disciplinary practices demonstrate a professional corporate culture—an increasingly important factor in attracting and retaining top talent.

If your business is considering terminating an employment relationship or wishes to review its internal disciplinary procedures, our labor law team is ready to provide practical and tailored legal advice.

Need Labor Law Advice in Vietnam?

Contact us today for a free 30-minute consultation on employment termination procedures, employee dismissal, and labor dispute prevention.

Disclaimer: This article is intended for general informational purposes only and does not constitute legal advice. Labor laws may change over time. Please consult a qualified lawyer at admin@fareast-legal.com for advice tailored to your specific circumstances