To reduce redundant compliance and clarify regulations, the Vietnamese government is drafting a new decree to reform the governance of foreign workers in the country. This draft aims to create a stronger legal framework that fosters conditions favorable for attracting high-skilled talent vital for economic development.

Vietnam’s Ministry of Home Affairs (MOHA) has recently submitted a draft decree to replace existing regulations on foreign employees working in Vietnam, which are currently governed by Decree No. 152/2020/ND-CP (“Decree 152”), amended by Decree 70/2023/ND-CP (“Decree 70”).

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Among its 34 articles filled with numerous revisions, a significant improvement in this draft is the proposal to reduce the work permit issuance period from 36 days to just 10 days, which will greatly alleviate the administrative burden on companies seeking to hire international talent in Vietnam.

The draft decree also includes various favorable regulations for foreign experts in Vietnam’s prioritized fields of development, such as finance, science, technology, innovation, and digital transformation. This article examines the most important policies outlined in the upcoming decree, which is expected to unlock the full potential for talent recruitment in this booming economy.

Eliminating title criteria – a major obstacle to talent mobility

Among the current eligible cases for expatriates to receive work permits in Vietnam, the criterion of “being a manager, executive director, expert, or technical worker” has been the most debated. Many argue that this requirement is misleading, as it restricts eligible individuals to these specific job positions, creating difficulties for businesses in providing necessary documents to prove their personnel’s eligibility.

To clarify the confusion, the draft decree replaces it with the criterion that foreign workers must be transferred from foreign agencies, organizations, and enterprises to work in Vietnam, thus abolishing the barrier to talent mobility for businesses.

Changes of licensing authority

Following the merger with the Ministry of Labor, War Invalids and Social Affairs (MOLISA), the MOHA is now tasked with assisting the Government in managing labor-related matters.

In this context, local home affairs departments are empowered to grant, renew, extend, revoke, and confirm exemptions from work permits. The authority of these departments does not extend to foreign workers hired by agencies, organizations, or enterprises established by the Government, the Prime Minister, ministries, ministerial-level agencies, and other government entities. These cases are under the jurisdiction of the MOHA or the provincial People’s Committee corresponding to the location of the agency, organization, or enterprise.

Abolition of prerequisites for prior approval of foreign labor demand 

Currently, employers must post a recruitment notice for Vietnamese employees for positions expected to hire foreign employees at least 15 days before the anticipated date for submitting the application for approval to hire foreign employees. Only after that, the employer can apply for approval to hire foreign employees at least 15 days before the expected start date of employment for that personnel. The entire process for work permit applications in Vietnam, therefore, typically prolongs between 30 and 36 days.

Under the draft, employers are permitted to combine these procedures with the work permit process, rather than conducting them separately. This alteration aims to reduce the overall time for obtaining a permit to just 10 working days from the date of a valid application submission, thereby decreasing administrative costs for both employers and foreign employees.

Revised regulations on application for new work permits

The draft decree extends the requirement for foreign workers, who have valid work permits and have had their permits extended once, to apply for a new permit if they want to continue working in the same role with their previous employer in Vietnam. This regulation now encompasses all foreign workers instead of being limited to experts and technical workers, as outlined in the current regulations.

Enabling the extension of work permit exemption certification

The draft decree indicates that employers can seek an extension of the work permit exemption once the original certification expires, allowing for a maximum employment period of two years. Currently, businesses may request that the licensing agency certify a foreign employee is exempt from work permit requirements for an employment term of up to two years.

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However, after this period, the employer is required to reapply for certification following the same steps as a new application, with no extension process available.

The proposed regulation aligns the administrative regulations for both employees who require work permits and those who do not, helping employers maintain a stable foreign workforce. This is particularly important as experts and high-tech workers are vital for the operational chain and technology transfer processes.

Streamlined verification of expert qualifications

Decree 152 stipulates the conditions for determining a foreign employee as an expert, which include the following criteria:

• Graduating from university or higher (or equivalent) and having at least 3 years of working experience suitable for the job position that the foreign employee is expected to work in Vietnam;
• Having at least five years of experience and holding a practice certificate suitable for the job position that the employee is expected to work in Vietnam; or
• Special cases approved by the Prime Minister related to MOLISA’s proposal.

However, the above conditions are no longer compatible due to the shift in Vietnam’s economic development strategies. The country’s recent policies focus on attracting highly skilled workers in emerging sectors such as the semiconductor industry, artificial intelligence, and digital transformation. Therefore, the draft suggests incorporating specific exceptional cases where foreign employees with only a university degree may be deemed qualified to work in Vietnam in fields such as finance, science, technology, innovation, national digital transformation, and priority development areas, or under government cooperation agreements.

Read more: Applying for a Vietnam Work Permit: Guidelines for Employers

Looking forward

Beyond the aforementioned changes, the draft decree introduces transitional provisions designed to ensure the smooth enforcement of the law and minimize disruptions to business activities. Employers and foreign workers holding valid work permits or corresponding permits under existing regulations can continue to use these documents until their expiration.

Overall, the draft has introduced significant modifications to the regulations governing foreign workers in Vietnam. It outlines a more efficient system aimed at enhancing Vietnam’s appeal to foreign professionals and investors.