On 20 November 2019, the National Assembly of Vietnam adopted the Labor Code (New labor code). The new labor code will take effect in 1st January 2021.

Companies should notice that:

1. Increase one day off to the national independence holiday which is on 2 September. The total holiday for one year will become 11 days, rather than 10 days now.

2. The total overtime hour for one year will be maximum 200 hours. However, some individual industry are permitted to organize overtime work of up to 300 hours in a year.

3. Weekly normal working hour will remain as 48 hours.

4. Any person working under an agreement who satisfies the following three factors: (i) having a job, (ii) getting paid and (iii) working under the supervision of an employer, will be considered to be an employee under the scope of the New Labor Code, regardless of the names and forms of the agreements.

5. Beyond the existing labor union and its affiliated unions, the new labor code allows worker to establish another labor union.

6. The retirement age will be gradually increased to 62 for males and 60 for females.

7. The government of Vietnam is no longer to get involve in salary scheme.