An employer of record in Vietnam lets you hire someone in Ho Chi Minh City or Hanoi next week without registering a company. That part is simple, and every provider explains it. What almost nobody explains is the part that decides whether the arrangement is sound: what your real cost is once statutory contributions and the 2026 contribution caps are applied, what providers actually charge, and whether an EOR arrangement sits inside or outside Vietnam’s licensed labour sublease regime.

This guide covers those. It gives the current employer contribution rates with the caps that apply from 1 July 2026, three worked cost examples at different salary levels, the published prices of the main global and local providers, the employment law your provider has to get right, and a straight account of the one legal question that every EOR page in this market avoids.

All figures and legal references checked October 2026. Vietnamese social insurance, tax and investment law all changed during 2025 and 2026, and a great deal of published guidance on employer of record Vietnam is now out of date. Confirm anything decision critical with Vietnamese counsel before you act on it.

Key Takeaways

• Budget 23.5 percent on top of gross salary for a Vietnamese employee, made up of social insurance 17.5 percent, health insurance 3 percent, unemployment insurance 1 percent and a 2 percent trade union fund contribution. For a foreign national the load is lower, because unemployment insurance applies to Vietnamese nationals only.
• The contribution caps matter more than the percentage. Social insurance, health insurance and the union fund are capped at 20 times the government reference level, which rose to 2,530,000 VND on 1 July 2026, putting the ceiling at 50,600,000 VND a month. Above that salary your effective employer load falls sharply, from 23.5 percent toward 13 percent.
• Published EOR prices for Vietnam span more than tenfold. Global platforms list 459 to 699 US dollars per employee per month. Vietnam-based providers publish 50 to 250. The spread is real and it buys different things, which this guide explains.
• Vietnamese law does not use the term “employer of record”. It does license labour subleasing, with a 2 billion VND deposit and a closed list of 20 permitted occupations. Whether an EOR arrangement falls inside that regime depends on how the relationship is actually structured, and it is the question to put to any provider you shortlist.
• Foreign employees joined mandatory social insurance on 1 July 2025 under Law 41/2024/QH15, on fixed-term contracts of 12 months or more, with exemptions including intra-company transferees. Late payment now carries a flat 0.03 percent per day.
• Personal income tax changed for 2026. Law 109/2025/QH15 cuts the brackets from seven to five and raises the personal deduction to 15,500,000 VND a month, which raises take-home pay at no cost to you.
• Severance exposure is far smaller than most employers assume, because service covered by unemployment insurance is excluded from the calculation and unemployment insurance has been mandatory since 2009.

What Is an Employer of Record (EOR)?

An employer of record is a company that legally employs workers on your behalf in a country where you have no legal entity. The EOR holds the employment contract, runs payroll, withholds and remits tax, registers and pays statutory insurance, and carries the employer-side compliance liability. You choose the person, direct the work, and manage performance.

In Vietnam the model solves a specific mechanical problem rather than just an administrative one. A foreign company with no Vietnamese entity has no way to register as a contributing employer with Vietnam Social Security, and therefore no lawful way to pay the social, health and unemployment insurance that Vietnamese employment carries. It also cannot file a work permit application, because that filing must come from a Vietnamese entity. The EOR’s own entity is what closes both gaps.

EOR, PEO and Staffing Are Not the Same Thing

These terms get used interchangeably in vendor marketing, and the differences matter in Vietnam specifically.

Model	Who is the legal employer	Who finds the person	Typical use in Vietnam
Employer of record	The EOR, through its Vietnamese entity	You, or a recruiter	Hiring without an entity
PEO, co-employment	Shared in markets that recognize co-employment	You	Limited relevance, Vietnam has no co-employment doctrine
Staffing or labour sublease	The licensed sublease company	The agency	Temporary placements in 20 permitted occupations
Outsourcing or BPO	The provider	The provider	Buying a delivered function, not a named person

The PEO distinction is worth stating plainly because several providers sell “PEO Vietnam” as a product. Co-employment is a US legal construct. Vietnamese law recognizes one employer per employment contract, so what is sold as a Vietnamese PEO is in practice either an EOR or a licensed labour sublease arrangement. Ask which. See also our comparison of EOR vs staffing agency.

Is an Employer of Record Legal in Vietnam?

This is the most important question on the page and no competing article answers it. Here is the honest position.

There is no Vietnamese statute that defines or licenses an “employer of record”. The term does not appear in the Labour Code, in investment law, or in any decree. That is not the same as saying the model is prohibited. It means the arrangement is assessed against the rules that do exist, and the relevant one is the regime governing labour subleasing.

What Vietnam’s Labour Sublease Regime Actually Requires

Labour subleasing, cho thue lai lao dong, is governed by Articles 52 to 54 of the Labour Code 2019 and by Decree 145/2020/ND-CP. It describes the situation where a company employs a worker and then supplies that worker to a second company which directs their day to day work. The conditions are strict:

• A labour sublease license is required, issued to the supplying company.
• A bank deposit of 2,000,000,000 VND must be lodged and maintained.
• The legal representative must have at least three years of relevant sector experience and no relevant criminal record.
• Subleasing is capped at 12 months per worker.
• Only the occupations listed in Appendix II of Decree 145/2020 may be subleased. That list runs to 20 job categories, and software engineering is not a general entry on it.

Read those conditions and the risk becomes obvious. If an arrangement is characterized as labour subleasing, an unlicensed provider is operating unlawfully, the 12-month cap bites on an arrangement you intended to be permanent, and the occupation list may not cover the role you are hiring for at all.

Where EOR Sits, and What to Ask

The distinction turns on substance rather than on what the contract is called. The analysis Vietnamese practitioners apply looks at who the worker is contracted to, who directs the work, and whether the provider is supplying labour as its service or employing a person for its client’s own operations. An arrangement where the provider employs the worker on its own entity’s Vietnamese-law contract, pays them directly, and provides employment administration as its service sits outside the sublease characterization more comfortably than one that reads as supplying a body to work under a third party’s direction.

We are stating that as the analysis rather than as a settled answer, because it is not settled. There is no published Vietnamese authority squarely on the point, and respected local firms have raised the question in print without resolving it. Two further things are moving:

• The 2025 Law on Investment removes 38 conditional business lines from 1 July 2026, and reporting indicates that both employment services and labour subleasing are on that list. If that holds, the licensing architecture above changes materially.
• The Labour Code and the Employment Law have not been amended in step, so the sectoral licensing requirement and the deposit arguably still apply. Vietnamese counsel are flagging the conflict openly. Treat the position as in flux through 2026 and 2027.

What this means practically. Do not accept “EOR is fully compliant in Vietnam” as an answer from any provider, including us, without the reasoning behind it. Three questions worth asking before you sign:

• Which legal entity will employ my people, and can I see its enterprise registration certificate? A provider operating through a partner entity it does not control is a different risk profile from one employing on its own.
• How do you characterize this arrangement under Articles 52 to 54, and do you hold a labour sublease license? Either answer can be acceptable. No answer is not.
• Who signs the employment contract, in whose name, and under which law? The contract should be a Vietnamese-law contract between the employee and the entity that employs them.

Our guide to EOR compliance sets out the wider due diligence framework. The point here is narrower: this is a real open question in Vietnam specifically, and a provider that has not thought about it is telling you something.

What Employing Someone in Vietnam Actually Costs

Most employer of record Vietnam pages quote a percentage and move on. The percentage alone is misleading, because Vietnamese contributions are capped, and the caps changed on 1 July 2026. Here is the full picture.

Contribution Rates

Contribution	Employer	Employee	Applies to
Social insurance	17.5%	8%	Vietnamese and foreign
Health insurance	3%	1.5%	Vietnamese and foreign
Unemployment insurance	1%	1%	Vietnamese nationals
Trade union fund	2%	0.5% if a member	Vietnamese and foreign
Total	23.5% Vietnamese, 22.5% foreign	10.5% Vietnamese, 9.5% foreign

The employer social insurance figure of 17.5 percent breaks down as 14 percent to the retirement and death fund, 3 percent to sickness and maternity, and 0.5 percent to occupational accident and disease insurance. The 2 percent trade union fund contribution is an employer obligation under the Law on Trade Unions, Law 50/2024/QH15, and is payable whether or not your employees are union members, which is why pages that quote 21.5 percent are understating your cost.

One point of genuine disagreement among published sources is whether foreign nationals owe unemployment insurance. The consensus position, and the one reflected above, is that unemployment insurance is for Vietnamese nationals only. At least one reputable source states otherwise. If you are budgeting for foreign hires, have your provider confirm their filing practice in writing.

The Caps, Which Are Where the Real Money Is

Vietnamese contributions are not levied on uncapped salary. Two separate ceilings apply, and they sit at very different levels:

• Social insurance, health insurance and the union fund are capped at 20 times the government reference level. The reference level replaced the old base salary concept under Law 41/2024/QH15. It rose to 2,530,000 VND a month on 1 July 2026 under Decree 161/2026/ND-CP, from 2,340,000 VND. That puts the current ceiling at 50,600,000 VND a month, up from 46,800,000 VND. The union fund contribution is therefore capped at 1,012,000 VND per employee per month.
• Unemployment insurance is capped at 20 times the regional minimum wage, which is a much higher ceiling. Regional minimum wages rose about 7.2 percent on 1 January 2026 under Decree 293/2025/ND-CP, to 5,310,000 VND in Region 1, which covers Ho Chi Minh City and Hanoi, 4,730,000 in Region 2, 4,140,000 in Region 3 and 3,700,000 in Region 4. The Region 1 unemployment insurance ceiling is therefore 106,200,000 VND a month.

The consequence is that your effective employer load is not a constant. It is 23.5 percent at ordinary salary levels and falls materially above 50,600,000 VND. For senior and management hires that difference is large enough to change a business case.

Three Worked Examples

Region 1, Vietnamese national, post-1 July 2026 figures. USD conversions are approximate at 26,000 VND to the dollar and are there for scale, not for budgeting.

Cost line	Support role	Senior developer	Engineering manager
Gross monthly salary	25,000,000 VND	50,000,000 VND	90,000,000 VND
Social insurance (17.5%)	4,375,000	8,750,000	8,855,000 (capped)
Health insurance (3%)	750,000	1,500,000	1,518,000 (capped)
Unemployment insurance (1%)	250,000	500,000	900,000
Trade union fund (2%)	500,000	1,000,000	1,012,000 (capped)
Total employer cost	30,875,000 VND (~$1,190)	61,750,000 VND (~$2,375)	102,285,000 VND (~$3,935)
Effective load on salary	23.5%	23.5%	13.7%

Read the last row carefully, because it is the single most useful number in this guide. At 90,000,000 VND a month the statutory load is 13.7 percent, not 23.5 percent, because three of the four contributions have stopped rising. Any cost model that applies a flat 23.5 percent to senior salaries will overstate your Vietnamese employment cost, and any provider quoting you a pass-through at the headline rate should be asked how they handle the ceiling.

What the Table Does Not Include

• The 13th month salary. Not a statutory requirement in Vietnam, but so widely paid, usually around Lunar New Year, that candidates assume it. Budget 13 months rather than 12.
• Your EOR fee, covered in the next section.
• Severance accrual, which is deliberately absent. The reason is explained under termination below, and it is not an oversight.
• Benefits above the statutory floor. Private medical cover is close to a market expectation for professional roles in Ho Chi Minh City and Hanoi, even though the statutory health insurance scheme exists.

For role by role salary benchmarks rather than cost mechanics, see our guides to software developers in Vietnam and global salary benchmarking.

What EOR Providers Actually Charge in Vietnam

Almost every page on this keyword says pricing “varies by provider” and declines to give a number. Here are the published list prices as of October 2026. These are the providers’ own stated figures, not quotes we have received, and country-specific rates often differ from headline global pricing.

Provider	Published EOR price	Type
Remote	699 USD per employee per month	Global platform
Papaya Global	From 650 USD per employee per month	Global platform
Deel	599 USD per employee per month	Global platform
G-P (Globalization Partners)	From 599 USD per month, global figure	Global platform
Multiplier	459 to 519 USD per person per month, billed annually	Global platform
Velocity Global, Safeguard Global	Not published, quote only	Global platform
Skuad	199 to 249 USD per employee per month on its Vietnam page	Global platform
Emerhub	10% of total monthly employment cost, minimum 49.99 USD, capped at 250 USD	Vietnam entity
RecruitGo	From 49.99 USD per month	Regional provider

The spread is more than tenfold, so it is worth understanding what drives it rather than simply sorting by price.

• Platform versus people. The global platforms are software companies first. The fee buys a self-serve system, breadth across 150 countries, and a support queue. A Vietnam-based provider is buying you local staff who know the provincial social insurance office.
• Owned entity versus partner entity. Several global vendors operate in Vietnam through a local partner. That is not disqualifying, but it means your employment relationship runs through a company your provider does not control, and it is a fair question to ask.
• What is actually in the fee. Work permit sponsorship, recruitment, equipment procurement, office space and local-law IP assignment drafting are commonly outside the headline price. Compare the scope before the number.
• Percentage versus flat fee. A percentage model is cheaper for junior roles and more expensive for senior ones. A flat fee inverts that. Model it against your actual salary band rather than against a generic example.

For the wider pricing landscape beyond Vietnam, see employer of record pricing.

How an Employer of Record Vietnam Works

The sequence below is what a competent engagement looks like in practice, with the Vietnam-specific detail that generic descriptions leave out.

1. You Select the Candidate

You run the hiring process and choose the person, either with your own recruiters or with the provider’s. This is where the two halves of the problem usually get split between two companies, and where a provider that both recruits and employs saves you the handoff. See recruitment services in Vietnam.

2. The EOR Becomes the Legal Employer

The provider issues a Vietnamese-law employment contract between its entity and your chosen hire. Check that it is an indefinite-term or fixed-term contract in the statutory forms, that probation is within the legal caps, and that intellectual property assignment is drafted under Vietnamese law rather than translated from a US template, which matters for reasons set out below.

3. Registration and Onboarding

The employee is registered with Vietnam Social Security and enrolled for social, health and unemployment insurance, and a tax code is issued or confirmed. For a foreign hire, this is also the point at which the work permit and temporary residence card process starts, and that process has a longer lead time than the employment setup.

4. Payroll and Taxes Are Managed

The provider calculates gross to net, withholds personal income tax, remits employer and employee contributions, and files. Vietnamese social insurance payments are due by the last day of the following month, and late payment now carries a flat penalty of 0.03 percent per day under Law 41/2024/QH15, so the filing calendar is not a formality. See EOR payroll and how to pay international employees.

5. You Manage Performance and Operations

The employee works on your roadmap, in your tools, to your standards. You handle day to day direction, performance and progression. The provider handles the employment relationship in the background.

One Vietnam-specific point to settle at this stage rather than later: if you intend to manage anyone out on performance grounds, Vietnamese law requires a written performance evaluation regulation to be in place first, issued after consultation with the employee representative body. Ask your provider whether their entity has one. Without it, a performance dismissal can be unlawful however much notice you give.

The Employment Law Your Provider Has to Get Right

You are outsourcing the liability, not the consequences. These are the rules that determine whether your arrangement holds up, drawn from the Labour Code 2019, Law 45/2019/QH14, and Decree 145/2020/ND-CP.

Contracts, Probation and Hours

• Contract types. Indefinite-term, or fixed-term up to 36 months. A fixed-term contract may generally be renewed only once before it must become indefinite, which is a common trap for employers who expect to roll annual contracts indefinitely.
• Written contracts are required for any engagement over one month.
• Probation caps. Up to 180 days for enterprise managers, 60 days for roles requiring a college degree or above, 30 days for intermediate and technical roles, and 6 working days for everything else.
• Working hours. Eight per day and 48 per week, with overtime capped at 200 hours a year, extended to 300 in specified cases.
• Overtime premiums. At least 150 percent on a normal working day, 200 percent on a weekly rest day and 300 percent on a public holiday or paid leave day.
• Minimum wage. 5,310,000 VND a month in Region 1 from 1 January 2026. Far below professional salary levels, but it is the floor your statutory calculations sit on.

Leave and Holidays

• Annual leave. A minimum of 12 working days, rising to 14 for minors, disabled employees and arduous occupations and 16 for especially arduous ones, plus one additional day for every five years of service with the same employer. That seniority accrual is often missed in cost models.
• Public holidays. Eleven statutory paid days: New Year’s Day, five days for Tet, Hung Kings’ Commemoration Day, Reunification Day, International Labour Day and two days for National Day. A proposal to add a twelfth day on 24 November was before the National Assembly as of late 2026 and had not been enacted at the time of writing, so plan on eleven and watch for the amendment.
• Sick leave. Paid by social insurance rather than by you, at 30, 40 or 60 working days a year in normal working conditions depending on the employee’s contribution history, under 15 years, 15 to 30 years, and over 30 years respectively.
• Maternity leave. Six months, of which up to two may be taken before the birth, plus one additional month for each additional child in a multiple birth.
• Paternity leave. Between five and 14 working days depending on the circumstances of the birth, including caesarean delivery, premature birth and multiple births.

Termination, Notice and Severance

Vietnam is a statutory-grounds jurisdiction. An employer may terminate unilaterally only on an enumerated ground, which is the single biggest difference from at-will markets and the thing most commonly misunderstood by first-time employers in Vietnam.

Notice periods for employer-initiated termination are 45 days on an indefinite-term contract, 30 days on a fixed-term contract of 12 to 36 months, and 3 working days on a contract under 12 months. No prior notice is required where the termination follows structural or technological change, economic reasons, or a merger or consolidation.

Severance under Article 46 is half a month’s salary per year of service, calculated on the average salary of the six consecutive months before termination, for employees with at least 12 months of regular service.

And here is the carve-out that changes the economics: qualifying service time excludes any period during which the employee participated in unemployment insurance. Unemployment insurance has been mandatory since 2009. For an employee hired after 2009 and properly enrolled throughout, countable service is close to zero, and so is your severance liability. Your real exposure is pre-2009 service plus any gap where contributions were not made, which is precisely why it matters that your provider actually filed.

Redundancy is different and costs double. The job-loss allowance under Article 47 is one month’s salary per year of service, with a two-month minimum, triggered by restructuring, technological change, economic reasons or merger. Same 12-month eligibility, same unemployment insurance exclusion. The gap between an ordinary exit and a redundancy is the number to model.

Final payments are due within the statutory deadline following termination, which the Labour Code sets at 14 working days and extends to 30 in defined circumstances. Published figures vary, so confirm the current position for your situation. Our guide to global payroll compliance covers the recurring obligations.

Intellectual Property

If your Vietnamese team writes code or creates product work, ownership is worth getting right, and the Vietnamese default is better than most buyers expect. Under Article 39 of the Law on Intellectual Property, where an organization assigns the task of creating a work to its employee, that organization owns the economic rights unless otherwise agreed.

Three qualifications matter in an EOR arrangement specifically. First, the default covers assigned duties only, so the job description is load-bearing. Second, “work made for hire” is not a Vietnamese concept and a translated US clause can simply fail. Third, moral rights, including attribution and integrity, are inalienable and never transfer.

The EOR-specific wrinkle is that the statutory default vests ownership in the employer, and in this model the employer is your provider, not you. Your contract therefore needs a clean chain of assignment from the employee to the provider’s entity and from that entity to you. Ask to see how that chain is drafted. It is a reasonable question and a provider that cannot answer it is a problem.

Payroll, Tax and the 2026 Personal Income Tax Changes

Personal income tax in Vietnam changed meaningfully for 2026, and the change is good news you can use in recruitment.

Law 109/2025/QH15 cuts the progressive bracket count from seven to five and raises the deductions. Salary and wage provisions apply from the 2026 tax period.

Monthly assessable income	Rate
Up to 10,000,000 VND	5%
Over 10,000,000 to 30,000,000 VND	10%
Over 30,000,000 to 60,000,000 VND	20%
Over 60,000,000 to 100,000,000 VND	30%
Over 100,000,000 VND	35%

• The personal deduction rises to 15,500,000 VND a month, or 186,000,000 VND a year, from 11,000,000 VND.
• The dependant deduction rises to 6,200,000 VND a month per qualifying dependant, from 4,400,000 VND.
• Overtime and night-shift premiums and payments for unused leave are confirmed as exempt.

Why this is a recruitment argument rather than just a tax fact: higher deductions and wider lower brackets raise an employee’s take-home pay without raising your cost. If you are competing for a candidate against a local employer who has not updated their offer calculator, the net figure you can show is a genuine advantage.

Separately, and worth checking against your roles, the same body of 2025 legislation introduced a five-year personal income tax exemption on salary for high-tech professionals and high-quality digital technology industry workers. If it applies to your hires, it is a substantial net-pay advantage at no cost to you.

Foreign Employees: Social Insurance and Work Permits

If you are placing a non-Vietnamese technical lead, country manager or founder in Vietnam, two things changed recently.

Social Insurance for Foreign Nationals

Under the Law on Social Insurance, Law 41/2024/QH15, in force from 1 July 2025, foreign employees are within mandatory social insurance where they hold a fixed-term employment contract of 12 months or more in Vietnam. Notable exemptions include intra-company transferees, employees who are already at retirement age when the contract is signed, and cases covered by an applicable international treaty. The same law replaced the old base salary concept with the reference level, cut the pension qualifying period from 20 years to 15, brought new groups into coverage including part-time workers above the minimum contribution base and company managers, and set the late payment charge at 0.03 percent per day.

Work Permits After August 2025

Decree 219/2025/ND-CP, effective 7 August 2025, replaced both Decree 152/2020/ND-CP and Decree 70/2023/ND-CP. If a provider’s guidance still cites either of those, it is out of date. The main changes:

• Processing is now 10 working days from a complete dossier, with labour demand assessed and the permit issued in a single window.
• The separate job-posting and labour-demand approval step was abolished.
• Expert eligibility is now a bachelor’s degree plus two years of relevant experience, reduced to one year in priority sectors including technology, innovation and digital transformation.
• Permits run up to two years and may be extended once by up to two more.
• Exemption categories expanded from 14 to 15, and authority was decentralized to provincial People’s Committees with online processing.

The structural point for this guide: a work permit application must be filed by a Vietnamese entity. A foreign company with no Vietnamese presence cannot place a foreign national in Vietnam at all without one. Confirm that your provider’s entity will sponsor, because not every EOR does.

EOR vs. Setting Up a Local Entity

The live comparison most providers publish is accurate but too shallow to decide on. Here is a version with the thresholds that actually matter.

Factor	Employer of record	Your own Vietnamese entity
Time to first hire	Days	Months
Up-front cost	Low, a monthly fee	Capital contribution plus professional fees
Capital obligation	None	Declared charter capital must be fully contributed within 90 days of the enterprise registration certificate
Compliance liability	The provider’s	Yours
Can bill customers in Vietnam	No	Yes
Can sponsor work permits	Through the provider’s entity	Yes
Ongoing admin	Minimal	Chief accountant, e-invoicing, statutory filings, audit
Cost per head at scale	Moderate	Lowest
Sensible at	1 to roughly 20 people	Roughly 20+ people, or any revenue-facing activity

Two decision triggers are worth stating plainly, because they are the ones that actually force the choice:

• Revenue in Vietnam. If you need to sign contracts with Vietnamese customers or issue Vietnamese invoices, no EOR solves that. You need an entity, and the question is only when.
• Permanent establishment risk. If your activity in Vietnam goes beyond employing people and starts to look like concluding contracts or carrying on business there, you may create a taxable presence regardless of how your people are employed. An EOR is not a shield against that, and any provider implying otherwise is overselling.

For the full set of operating models, including representative offices, vendor-supplied teams and the realities of entity setup, see our guide to offshore hiring in Vietnam.

Converting from EOR to Your Own Entity

This is the question to ask at the start, not at the point you need it, and almost no provider page addresses it. If the team grows past the point where an EOR makes sense, you will want to move those employees onto your own entity. That transfer is not automatic and it has consequences:

• Service continuity. The employee’s social insurance record follows the person, but their service with your provider’s entity does not automatically carry across for entitlements that accrue by length of service, such as the extra annual leave day per five years. Agree how that is handled before anyone transfers.
• New contracts, not assignments. In practice the employee usually signs a fresh Vietnamese-law contract with your entity. That is a moment when terms can be renegotiated, in both directions, so manage it deliberately.
• Notice and cost of exit. Ask what notice the provider requires, whether there is a conversion or transfer fee, and whether anything in the agreement restricts you from employing the person directly. A restriction of that kind is a genuine switching cost and you want to see it before you sign, not after.

What Changed in 2025 and 2026

A short reference list, because the pace of change is the main reason published guidance on employer of record Vietnam goes stale.

Instrument	Effective	What it does
Law on Social Insurance 41/2024/QH15	1 July 2025	Foreign employees on contracts of 12 months or more join mandatory social insurance; reference level replaces base salary; pension qualifying period cut to 15 years; late payment set at 0.03 percent per day
Law on Trade Unions 50/2024/QH15	1 July 2025	Confirms the 2 percent employer trade union fund contribution
Decree 219/2025/ND-CP	7 August 2025	Replaces Decree 152/2020 and Decree 70/2023 on work permits for foreign workers
Decree 293/2025/ND-CP	1 January 2026	Regional minimum wages up about 7.2 percent; Region 1 at 5,310,000 VND
PIT Law 109/2025/QH15	Salary provisions from the 2026 tax period	Five brackets instead of seven; personal deduction to 15,500,000 VND; dependant deduction to 6,200,000 VND
Decree 161/2026/ND-CP	1 July 2026	Reference level to 2,530,000 VND, raising the contribution cap to 50,600,000 VND a month
2025 Law on Investment	Reported 1 July 2026	Removes 38 conditional business lines, reportedly including employment services and labour subleasing. Verify locally, the position is unsettled
Decree 283/2026/ND-CP	10 September 2026	Revises administrative penalties in labour, social insurance and overseas worker matters. Confirm current penalty amounts before relying on older figures

One further item to watch: Vietnam’s personal data protection framework is tightening beyond Decree 13/2023/ND-CP. Because an EOR arrangement involves cross-border transfer of employee data between your provider and you, confirm the current position and how your provider handles transfers before you design your HR data flows.

How to Choose an Employer of Record in Vietnam

Nine questions, in the order worth asking them. The first three are the ones that separate providers.

• Do you own the Vietnamese entity that will employ my people, and may I see its enterprise registration certificate? Partner-entity arrangements are common and not automatically wrong, but you should know.
• How do you characterize this arrangement against the labour sublease rules in Articles 52 to 54, and do you hold a sublease license? You are looking for a reasoned answer, not a reassurance.
• Who in Vietnam will handle my filings, and where are they based? Local presence is what resolves a social insurance query in a day rather than a fortnight.
• What is in the fee and what is extra? Work permits, recruitment, equipment, office space, IP drafting.
• How do you handle the contribution caps? A provider passing through statutory costs should be applying the 50,600,000 VND ceiling, not a flat percentage.
• Do you have a written performance evaluation regulation in place? This determines whether you can lawfully exit someone for underperformance.
• How is intellectual property assigned from the employee to your entity and from your entity to me? Ask to see the chain.
• What does converting to my own entity involve, and what does it cost? Ask before you sign.
• Can you sponsor a work permit for a foreign national? Not every provider can.

See also best employer of record for the wider evaluation criteria and EOR service providers for how the market is structured.

Who Should Use an Employer of Record Vietnam?

The model fits some situations well and others badly. Honestly:

• Companies making their first hires in Vietnam. One to twenty people, no entity, no appetite for a months-long setup. This is the core case.
• Enterprises building offshore engineering or product teams who want named individuals on their own roadmap rather than a vendor-delivered outcome.
• Businesses testing the market before committing capital to an entity.
• Companies converting contractors to employees, usually because the working relationship has drifted into something a Vietnamese authority would assess as employment. See hiring independent contractors vs employees.
• Startups expanding into Southeast Asia that need one person in Vietnam and cannot justify an entity for one head. See EOR for startups.

It fits badly where you need to bill Vietnamese customers, where you are hiring at a scale that justifies your own entity, or where you want an outcome delivered rather than people employed, in which case outsourcing is the better structure. For the regional view, see hiring offshore talent in Southeast Asia.

Why TalentHero Is Your Ideal EOR Partner in Vietnam

TalentHero is an Asia Pacific specialist that both recruits and legally employs, with our own entity in Vietnam. That combination matters here because the two halves of hiring in a new country, finding the right person and employing them compliantly, are usually sold by different companies, leaving you to manage the gap between them.

• Employer of Record. We employ your chosen hires through our own Vietnamese entity, with local-law contracts, social insurance registration, payroll, tax withholding and intellectual property assignment drafted under Vietnamese law. See our employer of record services.
• Recruitment on Demand. Our recruiters source and screen across Vietnam, including passive candidates who are not on the job boards.
• Global Payroll. Payroll run against current statutory rates and caps, including the July 2026 reference level change. See payroll services in Vietnam.
• Visa and Immigration. Work permit and temporary residence card support for foreign staff, sponsored through our entity.
• Contractor Management, Equipment Procurement and Office Space. The practical pieces of standing up a team, in one relationship.

When Another Model Is the Better Choice

• Large-scale, process-driven volume work. A BPO provider will deliver it more cheaply than an EOR arrangement. See top BPO companies in Vietnam.
• A committed team of twenty or more in Vietnam long term. At that scale your own entity is cheaper, and the conversation to have is about transition rather than about EOR.
• Revenue-facing activity in Vietnam. You need an entity. No EOR changes that.

Ready to Hire in Vietnam? Partner with TalentHero

If you have a candidate in mind, or a role you want filled and employed compliantly, we can tell you what it will cost at your actual salary band, including where the contribution cap lands, and whether an EOR is the right structure for what you are doing.

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Frequently Asked Questions

1. What is an employer of record Vietnam and how does it work?

An employer of record is a company with its own Vietnamese legal entity that employs people on your behalf. It holds the employment contract, registers the employee for social, health and unemployment insurance, runs payroll, withholds personal income tax and carries the employer-side liability, while you choose the person and direct their work. It is how a company with no Vietnamese entity hires in Vietnam legally.

2. Is an employer of record legal in Vietnam?

Vietnamese law does not define or license the term, which is not the same as prohibiting the model. What Vietnam does regulate is labour subleasing, under Articles 52 to 54 of the Labour Code 2019 and Decree 145/2020/ND-CP, which requires a license, a 2 billion VND deposit, a 12-month cap per worker and a closed list of 20 permitted occupations. Whether a given EOR arrangement falls inside that regime depends on how it is structured in substance. Ask any provider how they characterize it, and confirm with Vietnamese counsel.

3. Do I need to set up a company in Vietnam to hire employees?

No, if you use an employer of record. This matters more than it sounds: a foreign company with no Vietnamese entity cannot register as a contributing employer with Vietnam Social Security, so it has no lawful mechanism to pay statutory insurance, and it cannot file a work permit application for a foreign hire. You do need your own entity if you want to sign contracts with Vietnamese customers or issue Vietnamese invoices.

4. How much does an employer of record Vietnam cost?

There are two numbers. The statutory cost is gross salary plus 23.5 percent for a Vietnamese employee, capped as described below. The provider fee is separate, and published list prices in October 2026 ranged from about 50 US dollars a month at the low end of Vietnam-based providers to 699 US dollars a month on the global platforms. Compare what is included before comparing the fee, because work permits, recruitment and equipment are often extra.

5. What are the employer social insurance contributions in Vietnam?

For a Vietnamese employee: social insurance 17.5 percent, health insurance 3 percent, unemployment insurance 1 percent and a 2 percent trade union fund contribution, totalling 23.5 percent. Social insurance, health insurance and the union fund are capped at 20 times the government reference level, which is 50,600,000 VND a month from 1 July 2026. Unemployment insurance is capped at 20 times the regional minimum wage, which is 106,200,000 VND in Region 1.

6. Why does my effective cost fall at higher salaries?

Because of the caps. Once gross salary exceeds 50,600,000 VND a month, social insurance, health insurance and the union fund stop rising, so the employer load as a percentage of salary falls. At 90,000,000 VND a month the effective statutory load is about 13.7 percent rather than 23.5 percent. Any cost model applying a flat percentage to senior salaries will overstate the real figure.

7. Do foreign employees pay social insurance in Vietnam?

Yes, where they hold a fixed-term contract of 12 months or more, under Law 41/2024/QH15 in force since 1 July 2025. Exemptions include intra-company transferees, employees already at retirement age when the contract is signed, and treaty cases. Unemployment insurance is generally understood to apply to Vietnamese nationals only, though published sources are not unanimous, so confirm your provider’s filing practice in writing.

8. What is the personal income tax rate in Vietnam in 2026?

Five progressive brackets from 5 to 35 percent under Law 109/2025/QH15, down from seven: 5 percent up to 10 million VND of monthly assessable income, 10 percent to 30 million, 20 percent to 60 million, 30 percent to 100 million and 35 percent above that. The personal deduction rose to 15,500,000 VND a month and the dependant deduction to 6,200,000 VND. The effect is higher take-home pay at no additional cost to the employer.

9. How long does it take to hire through an EOR in Vietnam?

Onboarding a candidate you have already selected typically takes days once documents are in hand. Finding the person is the longer part, usually three to six weeks for mid-level roles and longer for scarce specialisms. If you are placing a foreign national, the work permit process runs on its own timeline, now 10 working days from a complete dossier under Decree 219/2025/ND-CP, and that is the step to start early.

10. How much severance will I owe if it does not work out?

Probably far less than you expect. Statutory severance is half a month’s salary per year of service, but service covered by unemployment insurance is excluded and unemployment insurance has been mandatory since 2009. For a properly enrolled post-2009 hire, countable service is close to zero. Redundancy is different and costs double, at one month per year with a two-month minimum. Note that Vietnam is a statutory-grounds jurisdiction, so the lawful ground matters more than the payment.

11. Who owns the intellectual property my Vietnamese team creates?

Under Article 39 of the Law on Intellectual Property the employer owns the economic rights in work it assigned to an employee, unless otherwise agreed. In an EOR arrangement the employer is your provider, so you need a clean assignment chain from employee to provider entity to you. Three qualifications apply: the default covers assigned duties only, US work-made-for-hire clauses are not a Vietnamese concept and can fail, and moral rights are inalienable.

12. What is the difference between an EOR and a PEO in Vietnam?

In Vietnam the distinction mostly collapses. PEO describes co-employment, a US construct, and Vietnamese law recognizes a single employer per employment contract. So a service marketed as a Vietnamese PEO is in practice either an employer of record or a licensed labour sublease arrangement. Ask which one it is and who signs the contract.

13. How many days of annual leave and public holidays apply in Vietnam?

A minimum of 12 working days of annual leave, more for arduous occupations and younger or disabled employees, plus one additional day for every five years of service with the same employer. There are 11 statutory public holidays, including five days for Tet. A proposal to add a twelfth day on 24 November was pending before the National Assembly in late 2026 and had not been enacted at the time of writing.

14. Can I move my employees from the EOR onto my own entity later?

Yes, and it is worth asking how before you sign. The employee’s social insurance record follows the person, but service-based entitlements with the provider’s entity do not automatically carry across, and in practice the employee signs a fresh Vietnamese-law contract with your entity. Ask about notice, any conversion fee, and whether anything in the agreement restricts you from employing the person directly.