The settlement of disputes concerning labor contracts is a crucial issue in employment relations between employers and employees. When a dispute arises, the proper application of legal provisions helps protect the rights and legitimate interests of both parties while maintaining stability in the workplace. Below, NPLaw invites readers to explore the key legal issues relating to the settlement of labor contract disputes.
I. Current situation of labor contract dispute settlement
In recent years, disputes relating to labor contracts in Vietnam have tended to increase in both number and complexity. The primary causes often stem from employers’ violations of labor contract regulations, such as unlawfully terminating labor contracts, failing to pay wages, or breaching contractual commitments. In addition, many employees lack sufficient legal knowledge to protect their legitimate rights when disputes occur.
Although the labor law system has become increasingly complete, the settlement of disputes still has many difficulties, such as prolonged settlement periods, the absence of effective legal mechanisms for employees, and conciliation processes that are often merely formalities. These challenges underscore the urgent need to enhance the effectiveness of labor dispute resolution authorities and strengthen the legal awareness among parties in labor relations.
II. Legal provisions governing the settlement of labor contract disputes
1. What is the settlement of labor contract disputes?
The settlement of labor contract disputes refers to the process whereby a competent authority, organization, or individual examines and issues decisions on disagreements or conflicts arising between employees and employers during the execution of labor contracts.
2. Common types of labor contract disputes
Common labor contract disputes in Vietnam include:
- Disputes over wage claims;
- Disputes concerning unlawful unilateral termination of labor contracts;
- Disputes over severance pay;
- Combined disputes involving wages, severance pay, social insurance, and termination benefits;
- Disputes regarding compensation and allowances upon termination of labor contracts;
- Disputes concerning labor discipline;
- Disputes over reimbursement of training costs;
- Disputes relating to social insurance;
- Disputes and complaints regarding invalidation of decisions, veterans’ allowances, pensions, and occupational accidents.
3. Competent authorities for resolving labor contract disputes
Labor disputes are categorized into three main types: Individual labor disputes, collective labor disputes over rights, and collective labor disputes over interests. Each type is resolved by different competent authorities as follows:
- Individual labor disputes (Article 187 of the Labor Code 2019):
+ Labor conciliator;
+ Labor arbitration council;
+ People’s Court. - Collective labor disputes over rights (Article 191 of the Labor Code 2019):
+ Labor conciliator;
+ Labor arbitration council;
+ People’s Court. - Collective labor disputes over interests (Article 195 of the Labor Code 2019):
+ Labor conciliator;
+ Labor arbitration council.
Accordingly, the authorities competent to resolve labor contract disputes are clearly defined by law for each specific type of dispute. Identifying the correct type of dispute and selecting the appropriate competent authority is an essential factor in protecting the lawful rights and interests of both employees and employers.
III. Questions on labor contract dispute settlement
1. Is conciliation mandatory in labor contract disputes?
According to Articles 191 and 195 of the Labor Code 2019, conciliation is mandatory in labor contract disputes. However, Article 188 of the same Code provides several exceptions where conciliation is not required, including:
- Disputes concerning disciplinary dismissal or unilateral termination of labor contracts;
- Disputes over compensation or allowances upon contract termination;
- Disputes between domestic workers and employers;
- Disputes over social insurance, health insurance, unemployment insurance, occupational accidents, or occupational diseases;
- Disputes between employees and enterprises sending workers abroad;
- Disputes between leased employees and subleasing employers.
Therefore, except for the above-mentioned special cases, conciliation is a mandatory step in labor dispute settlement.
2. May employees file complaints with the company before bringing a case to Court?
Employees are fully entitled to file complaints with their company before initiating legal proceedings. Such a right is clearly stipulated in Clause 1, Article 3, and Clause 1, Article 10 of Decree No. 24/2018/NĐ-CP. Specifically, when an employee believes that an act or decision of the company violates labor laws and infringes upon their lawful rights and interests, they may submit a complaint to the competent person within the enterprise for resolution.
Accordingly, employees may first file complaints requesting the enterprise to reconsider the alleged unlawful act or decision. If the complaint is not satisfactorily resolved, the employee may still bring the case before the People’s Court to protect their lawful rights and interests.
3. What is the statute of limitations for labor dispute settlement?
The statute of limitations for settling labor disputes is regulated as follows:
- Individual labor disputes (Article 190 of the Labor Code 2019):
+ Request for conciliation: 6 months from the date of discovering the violation of rights or interests;
+ Request for resolution by the Labor Arbitration Council: 9 months from the date of discovering the violation;
+ Request for Court resolution: 1 year from the date of discovering the violation.
+ Periods of force majeure or objective obstacles shall not be included in these time limits. - Collective labor disputes over rights (Article 194 of the Labor Code 2019):
+ Request for conciliation: 6 months from the date of discovering the violation;
+ Request for resolution by the Labor Arbitration Council: 9 months from the date of discovering the violation;|
+ Request for court resolution: 1 year from the date of discovering the violation. - Collective labor disputes over interests (Article 197 of the Labor Code 2019):
+ The parties may request the Labor Arbitration Council to settle the dispute if conciliation fails or the conciliation period expires;
+ The Arbitration Council must be established within 7 working days from receipt of the request;
+ The Arbitration Council must issue a decision within 30 days from its establishment.
4. What can an employee request if dismissed unlawfully?
According to Article 5 of Decree No. 24/2018/NĐ-CP, if an employee is unlawfully dismissed, they may file a complaint directly with the employer. If the complaint is not resolved or unsatisfactory, the employee may escalate it to the Department of Labor, Invalids, and Social Affairs where the enterprise is headquartered.
Additionally, employees may request conciliation under Articles 188 and 189 of the Labor Code 2019. Disputes concerning disciplinary dismissal may be resolved by a labor conciliator or the Labor Arbitration Council. Employees have the right to file a lawsuit with the People’s Court where the enterprise is located to seek resolution for unlawful dismissal.
If the unlawful dismissal causes serious consequences, the employee may file a criminal complaint against the employer with the police. Such conduct may be subject to criminal prosecution under Article 162 of the Penal Code 2015 (amended in 2017) regarding the offense of forcing public officials or employees to resign or unlawfully dismissing employees.
IV. Legal consultancy services on the settlement of labor contract disputes
The foregoing article by NPLaw provides an overview of legal provisions governing the settlement of labor contract disputes. With a team of experienced lawyers and legal specialists, NPLaw is always ready to accompany, advise, and assist clients in resolving legal matters related to labor contract disputes. Should you require legal assistance, please contact NPLaw.
