TYPES OF LABOR CONTRACTS

A labor contract is an agreement between an employee and an employer regarding job duties, wages, working conditions, rights, and obligations of each party.

There are two types of labor contracts:

• Fixed-term labor contract.
• Indefinite-term labor contract.

There are 4 basic criteria that distinguish the differences between these two types of labor contracts:

First, regarding time:

A fixed-term labor contract is signed for a period of no more than 36 months, while an indefinite-term labor contract has no specific duration.
Second, regarding notice period before unilaterally terminating the contract:

For a fixed-term labor contract, the notice period is at least 30 days for contracts with a term of over 1 year, and at least 3 days for contracts with a term of less than 12 months. For an indefinite-term labor contract, the notice period is at least 45 days.
Third, regarding termination of the contract:

When a fixed-term labor contract expires, the labor relationship is considered terminated. If the employee continues to work after the contract expires, they must sign a new labor contract within 30 days. If they do not sign a new contract within 30 days, the old contract will become an indefinite-term labor contract. An indefinite-term labor contract has no specific end date.

TYPES OF LABOR CONTRACTS

A labor contract is an agreement between the worker and the employer regarding the job, salary, working conditions, rights, and obligations of each party.

Regarding the renewal of contracts, a fixed-term contract can only be signed a maximum of two times. After that, if the worker continues to work after the contract expires, a non-fixed-term labor contract must be signed. However, there are no provisions regarding the renewal of a non-fixed-term contract.

MAXIMUM CONTRACT DURATION

Furthermore, it should be noted that a fixed-term contract can only be signed a maximum of two times, except for exceptional cases as stipulated by the Labor Law, including:

Workers hired as directors in state-owned enterprises.
Elderly workers who have reached retirement age.
Foreign workers working in Vietnam.
Members of the leadership board of the worker representative organization at the grassroots level who are in their term but their contract has expired.
In general, when signing labor contracts, non-fixed-term contracts give more "freedom" to the workers when they want to change jobs, while employers are more "bound" by them.