Tiếng Việt
Table of Contents
- What is a labor contract?
- How many types of labor contracts are there?
- What is unilateral termination of a labor contract?
- In which cases can the employer unilaterally terminate the labor contract?
- Notice period required before unilateral termination by the employer?
- Cases where the employer is prohibited from unilaterally terminating the labor contract?
1. What is a labor contract?
Pursuant to Clause 1, Article 13 of the Labor Code 2019:
“A labor contract is an agreement between the employee and the employer on a paid job, wages, working conditions, and the rights and obligations of each party in the employment relationship.
If an agreement is made under a different name but contains terms on a paid job, wages, and the management, supervision, and administration of one party, it shall also be considered a labor contract.”
Thus, a labor contract is a legally binding document establishing the employment relationship between the employee and the employer, clearly stipulating their respective rights and obligations, working conditions, and wages. It must be entered into voluntarily and on equal terms, and be compliant with labor laws. During the performance of the labor contract, the parties may mutually agree to amend its contents.
2. Types of labor contracts
According to Clause 1, Article 20 of the Labor Code 2019:
“1. A labor contract shall be entered into in one of the following types:
a) An indefinite-term labor contract is a contract in which the two parties do not specify the term or the time of termination;
b) A definite-term labor contract is a contract in which the term and the time of termination are clearly specified and shall not exceed 36 months from the effective date.”
Hence, labor contracts are classified into two types:
- Indefinite-term labor contracts
- Definite-term labor contracts
3. What is unilateral termination of a labor contract?
Unilateral termination of a labor contract refers to the situation where one party (either the employee or the employer) decides to terminate the contract without the other party’s consent. However, such termination must comply with the terms of the contract and relevant laws. Any termination in violation of those provisions shall be considered illegal.
4. Cases where the employer is entitled to unilaterally terminate the labor contract
According to Clause 10, Article 34 and Clause 1, Article 36 of the Labor Code 2019:
“The employer has the right to unilaterally terminate the labor contract in the following cases:
a) The employee frequently fails to perform the work according to the criteria specified in the employer’s internal regulations (which must be consulted with the grassroots employee representative organization, if any);b) The employee is sick or has an accident and has been treated for 12 consecutive months (for indefinite-term contracts), 6 months (for definite-term contracts of 12–36 months), or more than half the contract term (for definite-term contracts under 12 months) but is still unable to resume work.
The employer shall consider reinstating the employee upon recovery;
c) Due to natural disaster, fire, dangerous epidemic, hostility, relocation, or downsizing of production or business at the request of competent authorities, and all remedial measures have been exhausted;
d) The employee is absent from work without justification after the period specified in Article 31 of this Code;
dd) The employee reaches retirement age under Article 169, except where otherwise agreed;
e) The employee voluntarily quits work for 5 consecutive working days or more without legitimate reasons;
g) The employee provides false information under Clause 2, Article 16 of this Code that affects recruitment.”
Thus, the employer may only unilaterally terminate the labor contract when one of the conditions in Clause 1, Article 36 is met.
5. Required notice period before unilateral termination by the employer
As per Clause 2, Article 36 of the Labor Code 2019, the employer must give prior notice before terminating the labor contract:
- At least 45 days for indefinite-term contracts
- At least 30 days for definite-term contracts of 12 to 36 months
- At least 03 working days for definite-term contracts under 12 months or in the case prescribed at Point b, Clause 1, Article 36
- For certain special industries or occupations regulated in Clause 1, Article 7 of Decree No. 145/2020/NĐ-CP:
- At least 120 days for indefinite-term or fixed-term contracts of 12 months or more
- At least ¼ of the contract term for contracts under 12 months
Exceptions – No notice is required if:
- The employee fails to return to work after the time limit in Article 31
- The employee is absent without valid reason for 5 consecutive working days or more
Article 36.3: “In the cases specified in Points d and e, Clause 1 of this Article, the employer is not required to give prior notice.”
6. Cases where the employer is prohibited from unilaterally terminating the labor contract
Despite the right to unilaterally terminate in certain cases under Article 36, Clause 1, the employer must not exercise this right when the employee is in one of the following situations:
- The employee is sick, injured, or suffers from occupational disease and is under treatment or convalescence as prescribed by a competent medical institution (except for Point b, Clause 1, Article 36)
- The employee is on annual leave, personal leave, or any other approved leave
- The employee is a pregnant woman, or is on maternity leave, or is nursing a child under 12 months old
Conclusion:
An employer wishing to unilaterally terminate a labor contract must strictly comply with the provisions of the Labor Code 2019. Any termination not in accordance with the law may result in legal consequences for both parties. Therefore, careful consideration and legal advice are recommended before proceeding. For more details, consult the Labor Code 2019 or a qualified labor law attorney.