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10 Points FDI Enterprises Need to Note in the 2026 Labor Code

Foreign-invested enterprises often have difficulty tracking changes in Vietnamese labor laws due to differences in the legal system compared to the host country.

This page is an automatic machine translation of the Vietnamese original. For legal matters, the Vietnamese version prevails. View Vietnamese original

10 Points FDI Enterprises Need to Note in the 2026 Labor Code

1. Type of labor contract

Current law recognizes labor contracts with indefinite term and fixed term — businesses need to determine the right type of contract appropriate to the nature of the job to avoid future disputes.

2. Probation period

The probationary period is limited according to the nature and complexity of the job - businesses are not allowed to probation beyond the prescribed period, even if there is an agreement with the employee.

3. Regional minimum wage

Regional minimum wages are adjusted periodically and vary by region — businesses with factories in multiple provinces need to update the correct level applicable to each area.

4. Working hours, overtime

Limits on the number of overtime hours per day, month, and year need to be strictly adhered to, especially in highly seasonal manufacturing industries — violating overtime hours limits is a common violation that is punished during inspections.

5. Labor discipline and handling of violations

The order of handling labor discipline must fully comply with the prescribed steps (notification, presence of the employee representative organization, minutes of disciplinary meeting...), otherwise the enterprise may be considered illegally fired even if there are grounds for violation.

6. Unilateral termination of labor contract

Both the employee and the employer have the right to unilaterally terminate the contract but must comply with the grounds and notice period as prescribed by law.

7. Social insurance, health care, unemployment

The payment rate and salary as a basis for social insurance payment need to be periodically reviewed to avoid lower than actual contributions, leading to risk of arrears.

8. Foreign workers

Regulations on work permits, license exemptions and renewal procedures need to be closely monitored because this is a group of documents with a high error rate in FDI enterprises.

9. Occupational safety and hygiene

Manufacturing enterprises need to ensure periodic labor safety training and complete related records — this is something that is often checked during labor inspections.

10. Collective labor agreements and dialogue at the workplace

Enterprises with employee representative organizations need to maintain periodic dialogue and develop collective labor agreements according to the correct process to limit collective labor disputes.

Frequently asked questions

Are FDI enterprises subject to different regulations than domestic enterprises? Basically, the Labor Code applies generally to all types of enterprises in Vietnam; The main difference lies in the separate regulations for foreign workers working at the enterprise.

How to promptly update labor law changes? There should be a labor legal consulting unit or EOR/payroll service to monitor regularly, because decrees and guiding circulars can change many times a year.

Does Nhân Kiệt advise on updating labor laws for customers? Yes, this is part of Nhân Kiệt's labor legalization and EOR services, helping businesses stay up to date with current regulations.

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