{"id":1629,"date":"2026-09-08T08:44:56","date_gmt":"2026-09-07T23:44:56","guid":{"rendered":"https:\/\/est.haro-inc.com\/?p=1629"},"modified":"2026-09-08T08:44:57","modified_gmt":"2026-09-07T23:44:57","slug":"probation-contract-guide","status":"publish","type":"post","link":"https:\/\/est.haro-inc.com\/en\/labor-law-contract-en\/probation-contract-guide\/","title":{"rendered":"Probation Periods and Labor Contracts in Vietnam \u2014 Mastering the Fixed-to-Indefinite “Conversion Rule”"},"content":{"rendered":"\n

When you hire in Vietnam, the very first thing you need to design correctly is the probation period and the contract term<\/span><\/strong>. If you extend a probation the way you might in Japan, or keep renewing a fixed-term contract again and again, you can easily run into labor disputes or an “unintended conversion to an indefinite-term contract”<\/span> later on. A design mistake at the point of entry is notoriously hard to undo after the fact\u2014and that is exactly what makes hiring in Vietnam tricky in practice.<\/p>\n\n\n\n

In this article, based on the Labor Code 2019 (Law 45\/2019\/QH14, effective January 1, 2021)<\/strong>, we organize the rules on probation periods, the “conversion rule” from fixed-term to indefinite-term contracts, the special provisions for foreign workers, and the penalties for non-compliance\u2014all from the practical viewpoint of a Japanese-affiliated company. In particular, we will pin down accurately the frequently misunderstood point that an indefinite-term contract is not the same as lifetime employment<\/strong>.<\/p>\n\n\n\n

1. There Are Only “Two Types” of Labor Contract in Vietnam<\/h2>\n\n\n\n

As a starting premise, under the Labor Code 2019 (Article 20) there are only two types<\/span><\/strong> of labor contract you can enter into. The “seasonal contract (under 12 months)” that existed under the old Labor Code (Law 10\/2012) was abolished<\/span> by the Labor Code 2019. Correctly understanding the difference between these two types is the starting point for all contract management.<\/p>\n\n\n\n

Type of Contract<\/th>Term<\/th>Key Features<\/th><\/tr><\/thead>
Indefinite-term contract<\/strong>
(indefinite-term)<\/td>		No fixed term<\/td>A contract with no specified end date. Beware of cases where a contract becomes indefinite “unintentionally” through the conversion rule described below.<\/td><\/tr>
Fixed-term contract<\/strong>
(fixed-term)<\/td>		Up to 36 months<\/strong> from the effective date<\/td>A contract with an explicitly stated term. It may only be concluded consecutively a maximum of two times<\/strong> (Article 20(2)).<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

The key points are that the fixed-term contract is capped at “36 months,” and that there are only two choices: “indefinite or fixed-term.” A practice of repeatedly concluding short contracts on the assumption of the old seasonal contract simply does not hold up under current law. On top of this two-type framework sit the “probation period” and the “conversion rule” we look at next.<\/p>\n\n\n\n

2. The Rules on Probation \u2014 Caps, Wages, and Frequency<\/h2>\n\n\n\n

Probation is governed by Articles 24 to 27 of the Labor Code 2019. The first thing a Japanese-affiliated company should grasp is that the maximum number of days differs by job type<\/span><\/strong> (Article 25).<\/p>\n\n\n\n

Applicable Job Type<\/th>Maximum Probation Period<\/th><\/tr><\/thead>
Enterprise managers (executive \/ director)<\/td>Up to 180 days<\/strong><\/td><\/tr>
Positions requiring a college degree or higher<\/td>Up to 60 days<\/strong><\/td><\/tr>
Intermediate vocational qualifications \/ technicians \/ skilled workers<\/td>Up to 30 days<\/strong><\/td><\/tr>
Others (general \/ unskilled labor)<\/td>Up to 6 working days<\/strong><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

There is also a statutory rule on wages. Wages during the probation period must be at least 85%<\/span><\/strong> of the wage payable upon official employment (Article 26). Setting a rate such as “half pay because it’s a trial” is unlawful.<\/p>\n\n\n\n

There are two ways to arrange probation (Article 24): (1) concluding a separate probation contract<\/strong>, or (2) including a probation clause within the labor contract<\/strong>. Note that probation cannot be applied to a contract of less than one month<\/span>. And most importantly, there is a limit on frequency: probation may be applied only once per position<\/strong>. Extending it, or running probation multiple times, is unlawful<\/span>.<\/p>\n\n\n\n

Termination during probation is flexible. During probation, either the company or the worker may terminate the contract without prior notice and without compensation<\/strong> (Article 27). Conversely, if the probation result is satisfactory, the company is obligated to conclude a labor contract<\/span><\/strong>. A response of “the result was satisfactory, but we won’t sign the main contract” is not permitted.<\/p>\n\n\n\n

3. The Easily Overlooked “Probation and Social Insurance”<\/h2>\n\n\n\n

What Japanese-affiliated companies tend to overlook when designing probation is the treatment of social insurance (compulsory enrollment)<\/strong>. Here, the conclusion changes depending on the arrangement (methods (1) and (2) above).<\/p>\n\n\n\n

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Social insurance costs change depending on the probation “method”<\/strong><\/p>\n\n\n

Under Decree 158\/2025\/ND-CP (effective July 1, 2025)<\/strong>, the treatment has been clarified as follows.<\/p>\n\n\n