Labor violations often negatively affect employees’ rights and employers’ reputation. Such a situation requires a profound understanding of legal provisions and a strong compliance from the parties.

In this article, NPLaw will consider the current state of labor violations, analyze relevant legal regulations, and clarify common violations, legal consequences, and the parties’ rights and responsibilities. In addition, NPLaw provides professional legal consultancy services to assist enterprises in ensuring compliance with law, preventing labor violations, minimizing legal risks, fostering harmonious and sustainable labor relations, and avoiding unnecessary liabilities.

I. Current situation of labor violations

Labor violations occur in various forms, causing public concern and negatively impacting socio-economic development. Common violations include:

  • Failure to pay wages correctly or sufficiently: Paying below regional minimum wage, making late payment, unlawfully deducting wages, and failing to pay wages of overtime or holiday work.
  • Violation of regulations on working and rest time: Requiring employees to work overtime beyond statutory limits, failing to ensure rest time as prescribed by law.
  • Failure to conclude labor contracts or signing of improper contracts: Employing employees without contracts, executing unlawful temporary contracts, or omitting essential contractual terms.
  • Unlawful termination of labor contracts: Dismissing or laying off employees without reasonable cause or compliance with legal regulations.
  • Violations of social insurance, health insurance, and unemployment insurance obligations: Failure to pay or incompletely pay compulsory insurances for employees.
  • Infringement upon employees’ dignity and physical integrity: Obtaining acts of violence, insult, or humiliation toward employees.
  • Discrimination: Existing unlawful distinctions based on gender, age, religion, ethnicity, marital status, etc.

Such violations not only cause financial and mental harm to employees but also reduce labor productivity, damage corporate reputation, and threaten social stability. For instance, a garment company in Binh Duong failed to pay social insurance for its employees, leading to collective complaints and a fine of 150 million VND. 

II. Legal provisions on labor violations

1. Definition of a labor violation

Current labor law does not regulate an official definition of a labor violation, it commonly may be understood as an act by either employer or employee that fails to comply with labor law provisions, thereby infringing upon the lawful rights and interests of the other party or the State. 

Violations may take the form of acts, such as failure to comply with contractual obligations (Article 13 of the Labor Code 2019), failure to ensure wage entitlements (Article 90 of the Labor Code 2019), or unlawful disciplinary and dismissal (Article 122 of the Labor Code 2019).

2. Basic types of labor violations

The Labor Code 2019 and its guiding documents provide numerous labor violations. Main and common violations include:

  • Violations relating to labor contracts: Failure to conclude contracts in the correct form, failure to ensure voluntariness and equality, or failure to conclude written contracts for work of one month or more.
  • Violations relating to wages: Paying below regional minimum wage, making late payment, failing to pay wages of overtime or holiday work, and unlawfully deducting wages. 
  • Violations relating to working and rest time: Requiring work beyond statutory limits, failure to arrange adequate rest, or denial of annual leave.
  • Violations relating to labor discipline and material liability: Imposing disciplinary measures without reasonable process or justification, or requiring employees to compensate without legal grounds.
  • Violations relating to occupational safety and hygiene: Failure to ensure safe working conditions, provide protective equipment, or conduct safety training.
  • Violations relating to female employees and underage workers: Assigning prohibited heavy or hazardous work to women or employing underage workers in violation of the law.

3. Is failure to conclude a labor contract with an employee a violation?

Except in special cases, failure to conclude a labor contract is a labor violation. According to Article 13 of the Labor Code 2019, a labor contract must be made in writing in duplicate, with one copy retained by each party.

Electronic contracts in the form of data messages are recognized as equivalent to written contracts.

However, under Clause 2, Article 13 of the Labor Code 2019, the employer is not required to enter into a written labor contract for work less than 01 month, but can reach an oral agreement. 

Accordingly, employing an employee for one month or more without a written (or electronic) contract constitutes a violation of the law.

III. Questions on labor violations

1. What are the legal consequences of dismissing employees without reasonable cause?

Unjustified dismissal or termination may constitute unlawful acts. Under Article 41 of the Labor Code 2019, employers must:

  • Reinstate the employee under the original contract.
  • Pay wages and insurance for the period of unlawful suspension.
  • Pay additional compensation equal to at least two months’ contractual wages.
  • Refund severance or redundancy allowances already received.

In addition, employers are also required to pay compensation equivalent to wages for the unnotified period. 

If reinstatement is not feasible, additional compensation may be negotiated by the parties.

Administratively, employers may be fined between 1 million VND and 20 million VND depending on workforce scope (Article 12 of Decree No. 12/2022/ND-CP).

2. Are enterprises required to pay social insurance for employees?

Pursuant to Article 2 of the Law on Social Insurance 2014, compulsory social insurance applies to all employees under contracts of at least one month. Both employers and employees must contribute according to statutory rates based on contractual wages.

Acts of evasion, late payment, or underpayment may constitute labor violations and be handled as prescribed by Law. 

Specifically, corporate managers may be fined from 500,000 VND to 1 million VND for negotiating with employees to avoid compulsory insurance. Enterprises may be fined from 24% to 30% of the total payable insurance, up to a maximum of 150 million VND if not paying social and unemployment insurance for enough people participating in compulsory insurance.  

3. What should employees do to protect their rights?

Under Articles 5 and 180 of the Labor Code 2019, employees may:

  • Collect evidence (contracts, payslips, emails, messages, photos, videos, etc.).
  • Negotiate directly with the employer or through trade unions.
  • File complaints with the Department of Labor, Invalids and Social Affairs or higher labor authorities.
  • File denunciations with the police or other competent authorities.
  • Initiate labor lawsuits before the courts if dissatisfied with administrative resolution.

4. What are the fines for violating regulations on working and rest time?

Article 18 of Decree No. 12/2022/ND-CP prescribes fines ranging from 2 million VND to 75 million VND depending on the type and extent of violation, including failure to provide statutory rest, excessive working hours, or unauthorized overtime without employee consent.

5. Can enterprises dismiss employees without reasonable cause?

Pursuant to Article 125 of the Labor Code 2019, enterprises are not entitled to dismiss employees without reasonable cause and must strictly comply with regulations on labor discipline measures and procedures.

Dismissal may only be imposed in the following cases:

  • The employee commits acts of theft, embezzlement, gambling, intentional infliction of injury, or uses drugs in the workplace.
  • The employee discloses business or technological secrets, infringes upon the employer’s intellectual property rights, causes serious damage or threatens to cause particularly serious damage to the employer’s property or interests, or commits sexual harassment in the workplace as prescribed in the internal labor regulations.
  • The employee, having previously been disciplined by wage raise deferment or demotion, repeats the violation during the period when the disciplinary record has not yet been cancelled.
  • The employee is absent from work without justifiable reason for an aggregate of 05 working days within 30 days, or for an aggregate of 20 working days within 365 days from the first day of absence. Justifiable reasons include natural disasters, fires, personal or family illness with certification from a competent medical facility, and other cases as provided in the internal labor regulations.

Dismissals must strictly follow the regulations set out in Article 122 and must be notified in writing to the employee in advance (Article 123 of the Labor Code 2019).

Any violation of the regulations on dismissal as a disciplinary measure may result in a fine ranging from 20 million VND to 40 million VND and liability to compensate the employee (Article 19 of Decree No. 12/2022/ND-CP).

IV. Legal advisory services on labor violations

NPLaw offers comprehensive consultancy services on labor violations for both employees and employers:

  • For employees:
    + Advising on rights and obligations under labor law.
    + Reviewing labor contracts and related agreements.
    + Assisting in drafting complaints and denunciations.
    + Representing employees in labor disputes.
  • For employers:
    + Advising on labor management and compliance obligations.
    + Drafting internal regulations, collective agreements, and labor contracts.
    + Assessing and minimizing legal risks.
    + Representing enterprises in dispute resolution.
    + Organizing training on labor law for management.

Ensuring the protection of rights and compliance with labor law in the most effective manner, please contact NPLaw to receive the best legal advice.