There are two types of employment contracts in Vietnam: the indefinite-term contract and the fixed-term contract, which may not exceed 36 months (Article 20(1) of the Labour Code). The Code says a labour contract "must" take one of these two forms. There is no seasonal contract any more, no "permanent" contract with a probation-style first year, and no at-will employment. A two-week assignment and a three-year assignment are both fixed-term contracts.
What trips up foreign-invested companies is less the definition than the conversion rule. A fixed-term contract becomes indefinite if the employee keeps working more than 30 days after expiry without a new contract, and only one further fixed-term contract may follow the first (Article 20(2)). This guide is based on the consolidated text of the Labour Code (18/VBHN-VPQH of 12 February 2026) and on Decree 283/2026/ND-CP, the labour penalty decree in force since 10 September 2026.
What are the types of employment contracts in Vietnam?#
- Indefinite-term contract: the parties do not fix a term or end date (Article 20(1)(a)).
- Fixed-term contract: the parties fix a term or end date within 36 months from the contract's effective date (Article 20(1)(b)).
There is no minimum term. Several English-language guides still state that a fixed-term contract runs from 12 to 36 months, and some list a third, seasonal category. Both reflect the old Labour Code 10/2012/QH13, which had a seasonal contract (or specific-task contract) of under 12 months (Article 22(1)(c)) and was repealed from 1 January 2021 (Article 220(1) of the current Code). As a contracting concept, "seasonal" survives only in Article 18(2), which lets a group of employees aged 18 or over doing seasonal work of under 12 months authorise one member to sign for all. That is a signing rule, not a contract type.
A term longer than 36 months, such as a five-year contract common in some group templates, breaches Article 20(1)(b). The Code does not spell out the consequence. In our reading, a court could declare that part of the contract partly invalid (Articles 49(2) and 50), and the drafting falls within the "wrong type of contract" offence discussed below.
The label on the document does not decide the question either. An agreement under any name that involves paid work, wages and one party's management, direction and supervision is treated as a labour contract (Article 13(1), second paragraph).
Types of employment contracts in Vietnam compared#
Both types carry the same mandatory contents (Article 21) and the same rules on wages, leave and safety. They differ in how they end and in a few obligations that depend on length.
| Indefinite-term | Fixed-term | Basis | |
|---|---|---|---|
| Term | No end date | Up to 36 months, no minimum | Art. 20(1) |
| Ends on expiry | No | Yes, except for leaders of the grassroots employee representative organisation during their term of office | Art. 34(1), Art. 177(4) |
| Employee's resignation notice | At least 45 days | At least 30 days (12 to 36 months); at least 3 working days (under 12 months) | Art. 35(1) |
| Employer's notice for unilateral termination on grounds (a), (c), (dd), (g) of Art. 36(1) | At least 45 days | At least 30 days (12 to 36 months); at least 3 working days (under 12 months) | Art. 36(2) |
| Consecutive contracts allowed | Not applicable | One further fixed-term contract, with four exceptions | Art. 20(2)(c) |
| Oral contract | No | Allowed under 1 month, with three exceptions | Art. 14(2) |
| Compulsory social insurance, Vietnamese employee | Yes | Yes, if 1 month or longer | Law 41/2024, Art. 2(1)(a) |
| Compulsory social insurance, foreign employee | Not addressed by Art. 2(2); rare in practice (see below) | Yes, if 12 months or longer | Law 41/2024, Art. 2(2) |
Enterprise managers and a few specialised jobs have their own notice period: at least 120 days for an indefinite-term contract or one of 12 months or more (Articles 35(1)(d) and 36(2)(d); Article 7 of Decree 145/2020/ND-CP), which matters for expatriate general directors.
An indefinite-term contract is not a job for life. The employer can still end it on the grounds in Articles 34 and 36; it simply loses "expiry" as a ground and gives longer notice. Our guide on how to terminate an employment contract in Vietnam covers the procedure, severance and payment deadlines.
The renewal rule: two fixed-term contracts, then indefinite#
Of all the rules on the types of employment contracts in Vietnam, this is the one most often breached. When a fixed-term contract expires and the employee keeps working, Article 20(2) applies:
- Within 30 days of expiry the parties must sign a new contract; until they do, the old terms continue (point a).
- If no new contract is signed within 30 days, the expired contract becomes an indefinite-term contract (point b).
- If the new contract is fixed-term, only one more may be signed; after that, continued employment requires an indefinite-term contract (point c).
Local articles that say a contract can be signed "up to three times" are counting the third, indefinite-term contract. The Labour Code has no counting rule of its own, so the 30 days follow Articles 147 and 148 of the Civil Code: counting starts the day after expiry and ends at midnight on day 30, or on the next working day if day 30 is a weekend or public holiday.
Four scenarios with dates#
These are hypothetical examples; the dates are our own calculation under Article 20(2) of the Labour Code and Articles 147 and 148 of the Civil Code.
- Renewed in time. A 12-month contract runs from 1 November 2026 to 31 October 2027. The employee keeps working and a 24-month contract is signed on 20 November 2027, effective that day. That second contract is valid and is the single permitted renewal.
- Left to run on. Same contract, nobody signs anything. The 30-day window closes at the end of 30 November 2027, and from 1 December 2027 the employee is on an indefinite-term contract. The employer cannot unilaterally put them back on a fixed term: changes need agreement, failing which the existing contract continues (Article 33(3)).
- Third contract. The second contract ends on 19 November 2029 and the employee stays. The only lawful option is an indefinite-term contract. A third fixed-term contract is the offence of concluding the wrong type of contract under Article 15(1) of Decree 283.
- Extension by appendix. To avoid using up the renewal, HR signs an appendix "extending the contract by six months". Article 22(2) prohibits this: an appendix may amend clauses but not the contract term. The Code does not state the consequence. In our reading the appendix has no effect on the term, the original contract still expires on its date, and if no new contract follows within 30 days the employee is likely already on an indefinite term.
Global HR systems often auto-renew annual contracts. In Vietnam that default produces indefinite-term employment after the second year, so set expiry alerts at least a month ahead and decide before the date whether to renew, convert or end the relationship with written notice.
Who may receive more than two fixed-term contracts#
Article 20(2)(c) lists four exceptions:
- persons hired as directors of enterprises with state capital (their contract contents are set by the Government under Article 21(4));
- elderly employees, meaning those working beyond the retirement age in Article 169(2) (Article 148), who may agree to successive fixed-term contracts (Article 149(1));
- foreign employees (Article 151(2));
- leaders of the grassroots employee representative organisation whose contract expires during their term of office. Here the rule runs the other way: the employer must extend the contract to the end of the term (Article 177(4)).
The Labour Code lists no other exception, whether by industry, by project or by agreement.
Types of employment contracts in Vietnam for foreign employees#
Expatriates fall under the same two types of employment contracts in Vietnam, but for one who needs a work permit the indefinite-term option is not available in practice. The contract term may not exceed the work permit term, and the parties may sign successive fixed-term contracts (Article 151(2)). A work permit lasts up to 2 years and may be extended once for up to 2 years (Article 155), and its term follows the expected contract term within that cap (Article 21(1)(a) of Decree 219/2025/ND-CP). The same 2-year cap applies to a certificate of work permit exemption.
Decree 219/2025/ND-CP took over the foreign-worker provisions of Decree 152/2020/ND-CP (as amended by Decree 70/2023/ND-CP) from 7 August 2025 (Article 35). Guides that still cite Decree 152/2020 for expatriate contracts are out of date on this point.
Example: if the permit is valid until 14 March 2028, the contract signed today must end on or before that date. When the permit is extended, sign a new contract for the new period; see work permit extension in Vietnam and work permit application in Vietnam. A lapsed permit is itself a ground for the contract to end (Article 34(12)).
One open point: neither the Code nor the decree says whether an expatriate's expired contract can convert to indefinite term under Article 20(2)(b) if the employee keeps working beyond 30 days. In our reading the contract cannot outlast the permit, so do not rely on conversion; sign a new contract as soon as the new permit is issued. The handbook entry on what a work permit is explains the permit itself.
Social insurance follows the contract length. A foreign employee on a fixed-term contract of 12 months or more is covered by compulsory social insurance, except intra-corporate transferees, those already at retirement age when the contract is signed, and cases governed by a treaty (Article 2(2) of Law 41/2024/QH15). Details are in our guide to social insurance for foreign employees.
Arrangements that are not a third type#
Group policies often use categories that have no equivalent among the types of employment contracts in Vietnam. Here is how they map.
- Probation. Probation is agreed in the labour contract or in a separate probation contract (Article 24(1)). A probation contract is not one of the two types in Article 20, and no probation is allowed for contracts under 1 month (Article 24(3)).
- Part-time. Part-time is an agreement on working hours (Article 32(2)). The contract is still indefinite or fixed-term and the renewal rule applies.
- Oral and electronic contracts. These are forms, not types. A labour contract must be written in two copies, and an electronic contract has the same value (Article 14(1)). Oral contracts are allowed only under 1 month, and never for group-authorised contracts, workers under 15 or domestic workers (Article 14(2)). If you sign electronically, see electronic employment contracts in Vietnam.
- Consultants and independent contractors. A service contract under Article 513 of the Civil Code is one where one party performs work and the other pays a fee. If the "consultant" works set hours, reports to a line manager and receives a fixed monthly amount, Article 13(1) of the Labour Code treats the arrangement as a labour contract whatever its title. Law 41/2024 on Social Insurance (Article 2(1)(a)) and Law 74/2025 on Employment (Article 31(1)(a)) use the same "other name" test, so reclassification can bring back-payment of social and unemployment insurance.
- "Working contracts" (hop dong lam viec) are concluded between public service units and public employees under the law on public employees; the Labour Code applies to public employees only in part, depending on the group (Article 220(3)). Private companies do not use them.
Fines for using the wrong type of contract#
Article 15(1) of Decree 283/2026/ND-CP groups four offences under one scale: no written contract for work of 1 month or more, no written contract with the authorised representative of a group, the wrong type of contract, and a contract missing mandatory contents. The amounts in the decree apply to individuals; companies, including branches and representative offices of foreign enterprises, pay double (Article 7(1) and (2)(b)).
| Employees affected | Individual employer (VND) | Company (VND) |
|---|---|---|
| 1 to 10 | 2 to 5 million | 4 to 10 million |
| 11 to 50 | 5 to 10 million | 10 to 20 million |
| 51 to 100 | 10 to 15 million | 20 to 30 million |
| 101 to 300 | 15 to 20 million | 30 to 40 million |
| 301 or more | 20 to 25 million | 40 to 50 million |
The authority will also order the employer to conclude the correct type of contract (Article 15(3)(c)). In our reading, the typical triggers are a third fixed-term contract and a term above 36 months.
Checklist for a foreign-invested employer#
- Remove "seasonal", "permanent after one year" and five-year templates; keep one indefinite-term and one fixed-term template, each with the mandatory contents of Article 21.
- Track each employee's contract count and expiry date, and decide at least a month before expiry.
- Never extend a term by appendix; sign a new contract instead.
- Make sure no expatriate's contract ends after the work permit term (Article 151(2)); for exempt employees, aligning with the exemption certificate is the prudent course.
- Review consultant and freelancer arrangements against the Article 13(1) test.
Knowing the types of employment contracts in Vietnam is the easy part; the risk sits in renewal cycles, group templates and contractor arrangements. LexData's employment law advice can review your templates, renewal cycles and expatriate contracts within an agreed scope. This article is general information, not advice on a specific case.
