How Does EOR Work in Vietnam? Complete Process Guide

An EOR services in Vietnam (EOR) in Vietnam hires employees on behalf of a foreign company through a locally registered entity. The EOR handles employment contracts, payroll, social insurance, and labor law compliance. Companies can hire their first employee in Vietnam within 5-7 business days using EOR without incorporating a Vietnamese entity.EOR services in Vietnam provide compliant employment without entity setup.

What Is the EOR Process in Vietnam?

The EOR onboarding process in Vietnam follows six steps. Step 1: The client company selects a candidate. Step 2: The EOR drafts an employment contract compliant with Vietnam's Labor Code 2019. Step 3: The employee signs the contract with the EOR's Vietnamese entity. Step 4: The EOR registers the employee for social insurance with VSS. Step 5: The EOR adds the employee to payroll. Step 6: The employee starts work under the client company's direction.outsourced payroll in Vietnam

Total timeline from candidate selection to first working day: 5-7 business days. This compares to 3-6 months for entity incorporation in Vietnam. The EOR's existing entity, tax registration, and social insurance enrollment enable immediate hiring. No additional government approvals are required for Vietnamese national employees.

How Much Does EOR Cost in Vietnam?

EOR fees in Vietnam range from $199 to $499 per employee per month. Setup fees range from $0 to $200 per employee. The fee structure is flat-rate: not percentage-based. The EOR fee covers employment contract management, payroll processing in Vietnam processing, social insurance administration, compliance management, and HR support.

Total monthly employer cost = Employee gross salary + 23.5% statutory contributions + EOR fee. For an employee earning 30,000,000 VND ($1,200), the total cost is: $1,200 salary + $282 statutory (23.5%) + $350 EOR fee = $1,832/month. Entity incorporation for the same employee would cost $15,000-$30,000 upfront plus $2,000-$5,000/month in entity maintenance.

Aniday provides EOR services in Vietnam starting at competitive rates: see Aniday EOR Vietnam for pricing details.

How Does the EOR Handle Payroll in Vietnam?

Vietnam operates on a monthly payroll cycle. The EOR calculates gross-to-net salary including personal income tax (PIT) withholding, employee social insurance contributions (10.5%), and any deductions. Net salary is paid to the employee's Vietnamese bank account by the agreed date: typically the last working day of the month or the first working day of the following month.

The EOR files monthly social insurance contributions with VSS, quarterly PIT reports with the General Department of Taxation, and annual PIT finalization by March 31. The EOR generates compliant pay slips showing all calculations. The client company receives a monthly cost report with total employer cost per employee.

How Does the EOR Handle Social Insurance Registration?

The EOR registers each new employee with Vietnam Social Security (VSS) within 30 days of the employment start date. Registration requires: the employment contract, the employee's ID card or citizen identification, household registration book, and 2 photos. VSS issues a social insurance book to the employee within 5 working days of registration.

The EOR remits monthly contributions of 23.5% (employer share) and 10.5% (employee share, withheld from salary) to VSS. The EOR handles all contribution adjustments for salary changes, leave periods, and termination. Upon termination, the EOR closes the employee's social insurance participation and issues confirmation for unemployment benefit claims.

How Does the EOR Handle Work Permits for Foreign Employees?

Foreign employees in Vietnam require a work permit from DOLISA. The EOR manages the application process. Required documents include: criminal background check from home country (apostilled), health certificate from a Vietnamese-approved hospital, degree certificate (apostilled and consularized), passport copies, and the employment contract.

Processing time is 4-8 weeks. Work permit validity matches the employment contract duration, maximum 2 years. Renewal must be filed 45 days before expiration. Work permit exemptions exist for: employees of foreign entities for less than 3 months, intra-company transferees under specific conditions, and technical experts providing short-term assistance. Aniday's EOR Vietnam service handles all work permit processing.

What Are the Limitations of EOR in Vietnam?

Three limitations affect EOR use in Vietnam. First, Vietnam's labor leasing regulations (Decree 29/2019/ND-CP) cap leased workers at specific positions and require licensing. EOR providers must structure employment as direct employment through their entity, not labor leasing, to comply. Second, the client company cannot sign contracts directly with employees: all employment documents go through the EOR entity.

Third, work permit sponsorship requires the EOR entity to demonstrate a legitimate business need for the foreign worker's skills. If the EOR entity does not operate in the relevant industry, work permit applications may face additional scrutiny. Companies hiring multiple foreign workers through EOR should verify the provider's work permit track record.

Can I use EOR in Vietnam for both local and foreign employees?

Yes. EOR in Vietnam works for Vietnamese nationals and foreign workers. Vietnamese employees can be onboarded in 5-7 business days. Foreign employees require additional time for work permit processing (4-8 weeks). The EOR handles social insurance, payroll, and compliance for both categories.

Does the EOR provide health insurance beyond statutory in Vietnam?

Statutory health insurance in Vietnam covers 80% of medical costs at registered hospitals. Most EOR providers offer supplementary private health insurance at additional cost ($50-$200/employee/month). Private insurance provides access to international hospitals, broader coverage, and shorter wait times. This benefit helps attract and retain talent.

How does EOR handle intellectual property in Vietnam?

IP protection under EOR requires explicit clauses in the service agreement between the client company and the EOR. The EOR includes IP assignment language in the employment contract, transferring employee-created IP to the EOR, which then assigns it to the client. Vietnam's IP Law recognizes assignment of rights through written agreements.

Can I hire interns through EOR in Vietnam?

Internships in Vietnam are governed by separate provisions under the Labor Code (apprenticeship contracts, Article 61-63). Most EOR providers do not support internship arrangements because internship contracts have different legal requirements. For paid full-time positions with clear job descriptions, EOR is the appropriate vehicle.

What happens if the EOR provider goes out of business?

If the EOR entity ceases operations, all employment contracts must be transferred or terminated in compliance with Vietnam's Labor Code. Employees are entitled to severance pay. The client company would need to either engage another EOR provider, incorporate their own entity, or terminate the employees. Service agreements should include business continuity provisions.

Aniday's HR Services