Issue 021225 – Important points to note in the execution of the labor contract

Dear Valued Clients,

The labor contract is the main legal basis regulating the rights and obligations between the employer and the employee throughout the working process. During the implementation process, the contract may need to be amended, supplemented, suspended or transferred to a job other than the labor contract to ensure compliance with the production and business situation and working conditions. The implementation of these changes, if not in compliance with the provisions of law, may lead to labor disputes, complaints or administrative sanctions.

The 2019 Labor Code (“Labor Code”) and its implementing documents have specifically stipulated the authority, order and procedures for amending, supplementing, suspending or transferring employees to jobs other than the labor contract. Therefore, employers need to pay special attention to drawing up contract appendices, notices, or written agreements in each case, to ensure the legality and enforceability of the contract.

The following article will outline current legal regulations related to amending, supplementing, suspending or transferring employees to do work other than the labor contract; at the same time, point out issues that businesses need to pay attention to during the application process, thereby contributing to limiting legal risks and ensuring the legitimate rights of the parties in the labor relationship.

In addition to the notes when entering into a labour contract, during its implementation, the parties also need to pay attention to two important contents: amending, suspending or transferring the employee to do a job other than the labor contract. When it is necessary to change the content of the contract such as work, salary or working hours, the two parties must agree in writing and make an appendix to the contract or sign a new contract. Contract suspension is only carried out in cases prescribed by law or agreed by both parties, and during this time the employee does not work, does not receive salary but is entitled to retain rights. When the suspension period ends, the employee must return to work on time. In particular, transferring the employee is only temporary and must be notified; if the change is permanent, the labor contract must be amended to ensure the rights and obligations of the parties.

1. AMENDMENTS AND SUPPLEMENTS TO LABOR CONTRACTS

According to Article 33 of the Labor Code, during the implementation of the labor contract, if one of the two parties needs to amend or supplement the content of the contract, that party shall fulfill the following requirements:

• Notify the other party at least 03 working days in advance of the content that needs to be changed.
• Amendments and supplements can only be made when there is an agreement between both parties, and are carried out by signing an appendix to the contract signed by both parties or signing a new contract.

First, amend and supplement through signing a new labor contract. In case the parties need to comprehensively change the content of the labor contract or there is a change that gives rise to a new type of contract (for example: from a fixed-term contract to an indefinite-term contract; change in position, job title; change in basic salary or main working conditions), the amendment and supplement will be made through signing a new labor contract. The new contract must ensure all the main contents stipulated in Article 21 of the Labor Code, and at the same time terminate the validity of the old contract from the time the new contract takes effect. This form helps ensure transparency, avoid overlap between the amended provisions, and clarify the rights and obligations of the parties in the labor relationship.

Second, amend and supplement through signing an appendix to the labor contract. In case the change only relates to one or several articles or clauses of the contract without changing the type of contract, the parties can do so by signing an appendix to the labor contract. According to Article 22 of the Labor Code, the appendix to the labor contract is an inseparable part of the contract and has the same effect as the labor contract. The appendix is ​​used to specify, amend or supplement some contents of the contract but cannot be used to change the term of the labor contract; if the term needs to be changed, the parties must sign a new labor contract. When making an appendix, it is necessary to clearly define the content of the amendment, supplement, time of application and effectiveness to ensure consistency and avoid conflicts with the terms of the original contract.

2. TEMPORARILY SUSPENDING THE PERFORMANCE OF THE LABOR CONTRACT

2.1. Situations leading to the suspension of the labor contract

According to the provisions of Article 30 of the Labor Code, the suspension of the performance of the labor contract is applied in certain cases, in order to ensure the legitimate rights and interests of both the employee and the employer when special situations arise that disrupt the labor relationship. Specifically, the employee is allowed to suspend the performance of the contract in the following cases:

• Performing military service, the obligation to participate in the Militia and Self-Defense Force;
• Being detained or imprisoned according to the provisions of law; having to comply with the decision to apply measures to send to a compulsory drug rehabilitation facility or a compulsory education facility;
• Pregnant female employees have confirmation from a competent medical examination and treatment facility that continuing to work will adversely affect the fetus;
• Being appointed as a manager of a state-owned enterprise or an enterprise with state capital; being authorized to exercise the rights and responsibilities of a representative of the state owner or state capital at another enterprise
• Other cases agreed upon by the two parties.

Thus, it is clearly to see that the suspension of the performance of the labor contract occurs in cases prescribed by law (such as performing military service, female employees with ear infections needing to take care of their pregnancy, resting as prescribed by a doctor, etc.). Additionally, the suspension of the labor contract can also be due to an agreement between the employee and the employer. In fact, the suspension of the labor contract often comes from the personal needs of the employee, such as participating in a program to improve qualifications, performing civic duties, or solving long-term family matters. In these cases, if approved by the employer, the two parties will sign an agreement to suspend the labor contract to clearly define the term, rights and obligations of each party during the suspension period.

2.2. Time of suspension of labor contract

The suspension period of the labor contract depends on the agreement between the enterprise, company and the employee. In case the two parties do not have an agreement, the suspension period of the contract is understood to be until the end of the suspension period of the labor contract as stated in Section 2.1. It should be noted that in the case of a pregnant female employee who temporarily suspends the performance of the labor contract (with confirmation from a competent medical examination and treatment facility that continuing to work will adversely affect the fetus), the suspension period is agreed upon by the parties but must be at least equal to the time specified by the competent medical examination and treatment facility for temporary leave[1].

When the suspension period expires, according to the provisions of Article 31 of the Labor Code, the employer is responsible for accepting the employee back to work within 15 days from the date of expiration of the suspension period, unless the two parties have a different agreement. If the employer fails to fulfill this obligation, it may be considered as unilaterally terminating the contract illegally and may be fined from 6 to 14 million VND[2] if the employer does not accept the employee back to work after the suspension period expires, unless otherwise agreed.

2.3. Salary and social insurance during the suspension period

Suspension of labor contract means the temporary suspension of work under the labor contract, meaning that the employee does not perform work under the labor contract during the suspension period. Therefore, the regimes, including salary, will not arise[3]. We can see that if there is an agreement between the employee and the employer on salary payment when suspending the labor contract, the employee will still receive salary. In case there is no agreement between the two parties on salary and rights and benefits under the labor contract, during the suspension of the labor contract, the employee will not receive salary.

Regarding social insurance payment in case of suspension of labor contract, the Law on Social Insurance 2024 stipulates that employees who do not work and do not receive salary for 14 working days or more in a month will not pay social insurance for that month[4]. Thus, in case of suspension of labor contract where the enterprise, company and employee do not have an agreement on salary payment and the suspension period is less than 14 working days, social insurance must still be paid according to regulations.

3. TRANSFERRING EMPLOYEES TO JOBS DIFFERENT FROM THE LABOR CONTRACT

3.1. Cases where the employer has the right to transfer the employee to a job other than the labor contract

According to the provisions of the Labor Contract, in principle, when signing a labor contract, the parties must have the obligation to properly perform the commitments and agreements in the labor contract. However, there will be objective conditions that the law stipulates that the employer will have the right to transfer the employee to a job other than the labor contract. Specifically, Article 29 of the Labor Code stipulates the cases where the employer is allowed to transfer the employee to a job other than the labor contract, as follows:

• When encountering sudden difficulties due to objective conditions such as natural disasters, fires, dangerous epidemics;
• Applying measures to prevent and overcome labor accidents and occupational diseases;
• Electrical and water incidents;
• Having production and business needs

In particular, in the case of transferring employees to do work other than the labor contract due to production and business needs, this “production and business need” must be clearly and specifically stipulated by the employer in the enterprise’s labor regulations.

3.2. Procedures when transferring employees to do work other than the labor contract

When it is necessary to temporarily transfer employees to do work other than the signed contract, the employer must notify the employee at least 3 working days in advance. The notice must clearly state the duration of the temporary work and that the work must be suitable for the health and gender of the employee.

The employer has the right to temporarily transfer employees to do work other than the labor contract, but not more than 60 working days in a year. However, this transfer can still be done with the written consent of the employee.

Thus, it can be seen that the law does not stipulate a limit on the number of times an employer can transfer an employee to do a job other than the labor contract. However, the law stipulates the maximum number of working days that an employer can transfer an employee to do in a year.

3.3. Wages paid to employees when transferring employees to do a job other than the labor contract

When employees are temporarily transferred to a job other than the signed contract, they will be paid according to the salary level of the new job. However, because this transfer is considered to be against the employee’s will, it is necessary to ensure stability in terms of salary for them. Therefore, at this time, if the new salary of the transferred employee is lower than the old job, then in the first 30 working days, the employee will still be kept at the old salary to ensure that the income is not suddenly affected. After this period, the new salary will be applied but must be at least 85% of the old salary and not lower than the minimum wage as prescribed by law.

In case the employee does not agree to temporarily do a job other than the labor contract for more than 60 working days accumulated in 01 year and must stop working, the employer must pay the suspension salary as prescribed in Article 99 of the Labor Code.

3.4. Legal responsibilities of employers

According to Article 11 of Decree No. 12/2022/ND-CP on handling administrative violations in the field of labor, employers will be fined if they transfer employees in violation of the law. Specifically, a fine of VND 2,000,000 to VND 6,000,000 will be imposed if the employer fails to notify the employee of the job transfer at least 03 working days in advance, or fails to specify the temporary working period or arranges work that is not suitable for the employee’s health or gender. A fine of VND 6,000,000 to VND 14,000,000 will be imposed if the employer transfers the employee to a job other than the one stated in the labor contract without a legitimate reason or without the employee’s consent, violating the principles prescribed in the Labor Code. In addition, the employer must also restore the legitimate rights and interests of the employee if the illegal transfer effects income or working conditions.

Thus, the current law imposes quite strict sanctions on illegal employee transfers, in order to protect the legitimate rights of employees and force employers to comply with the correct procedures. Therefore, before making a transfer, the employer must clearly notify, determine the reasonable reason, suitable job and specific temporary period to avoid complaints or administrative sanctions.

Kind regards,

ENT Law LLC

[1] Article 138 Labor Code

[2] Point b, Clause 2, Article 11 of Decree No. 28/2020/ND-CP regulating administrative sanctions for violations in the fields of labor, social insurance, and sending Vietnamese workers to work abroad under contracts.

[3] Clause 2, Article 30 of the Labor Code

[4] Clause 5, Article 33 of the Law on Social Insurance 2024