An Introduction To Overtime In Vietnam

Overtime in Vietnam is governed by many rules and regulations imposed by the Labor Code. Therefore, it's essential for both the employer and employee to understand how overtime works, pay, regulations, exceptions, etc. Understanding these regulations helps to create a fair and effective work environment and to build an effective employer-employee relationship.

In this Aniday’s guide, you will learn everything you need about overtime in Vietnam!

Who Governs Overtime Law In Vietnam?

The Vietnam Labor Code governs overtime law in Vietnam. The authority sets the rules and regulations related to working hours and compensation for overtime employees. Therefore, it's essential to safeguard employee rights related to overtime and understand how overtime policies in Vietnam work.

What Is Overtime In Vietnam?

According to the Vietnamese Labor Code, overtime is the hours worked by the employee over the standard 48 workweek or more than the agreed working hours stated in the employment agreement. Therefore, if work hours exceed the agreed timeline, they are considered Overtime in Vietnam.

Apart from that, heavy-duty or hazardous work employees have a maximum regular working time of only six hours a day. Therefore, if such an employee works beyond six hours per day, the employee needs to be compensated with overtime pay.

Some critical triggers are related to overtime beyond the regular hours worked. They are as follows:

• Weekends.
• Public holidays.
• Night hours (between 10:00 p.m. and 6:00 a.m.).

If an employee works overtime, the employer should fairly compensate for the extra hours worked. However, the goal is to maintain a fair working environment while valuing employee work.

How Can You Be Eligible For Overtime Pay In Vietnam?

In Vietnam, specific rules and regulations exist to be eligible to work overtime. Here's a breakdown of these overtime rules and regulations in Vietnam:

• Both public and private sector business employees qualify for overtime pay in Vietnam.

• An employee can only work overtime if they agree to it. The consent should be voluntary and agreed upon in a written document.

• Employees must agree to work overtime voluntarily, except in national emergencies or other instances, as the government states.

• Employees have overtime limits as follows: 

  • Employees cannot work more than 50% of the regular working hours in a day, more than 30 hours a month, or more than 200 hours a year.

  • If the business is related to an essential sector or service, the overtime hours can be extended to 300 hours annually.

How To Calculate Overtime Pay?

Overtime compensation in Vietnam can be calculated based on how the employee works and the decided pay structure. Here's how the overtime rates are calculated based on the different pay structures:

• Hourly and salaried employees: If employees work based on salaries or hourly rates, then overtime pay is calculated at 150% of the base rate worked at daytime for the extra hours on weekdays. The rate is 200% for nighttime and holiday hours. Also, if overtime is worked on rest days, it may vary up to 300%.

• Piecework employees: If employees work based on per-piece rates, overtime rates are calculated as an identical percentage increase over their average earnings per piece delivered during regular working hours.

• Commission-based employees: If employees work based on commissions, the overtime rates are calculated based on an hourly rate from their earnings. However, this rate cannot be less than the legal minimum wage.

While calculating overtime pay for employees, specific bonuses are included while certain are not. Here's a breakdown of these regulations:

• Regular, guaranteed bonuses are considered part of the base wage while calculating overtime pay.

• Discretionary bonuses or occasional incentives are generally excluded while calculating overtime pay.

Employee And Employer Rights And Obligations

Employee Rights To Overtime Pay

There are specific employee rights to overtime pay in Vietnam. The following are the critical employee rights related to overtime:

• Right to know overtime rates and compensation before agreeing to work overtime.

• Right to refuse overtime unless legally required.

• Right to obtain a clear statement of overtime hours and pay.

• Right to have a day off if weekly hours exceed the maximum limit.

• Right to get rest breaks and paid annual leave despite regular overtime.

Employer Obligations And Penalties For Non-Compliance

Just like employees have some overtime-related regulations, so do employers. The following are the critical employer obligations related to overtime:

• Obtain voluntary written consent for overtime unless in emergencies.

• Limit overtime hours within legal boundaries.

• Pay accurate overtime rates promptly based on work performed.

• Keep precise records of regular and overtime hours.

• Ensure employees have at least one day off weekly, even with regular overtime.

If the employer doesn't comply with the overtime laws, it may result in compensation claims, fines, penalties, or even suspension of the business.

Exceptions In Overtime Work In Vietnam

There are exceptions for pregnant women and minor workers when considering overtime work. The following are the overtime exceptions for pregnant women who are forbidden to work overtime:

• Women at their 7th month or later.
• Women who have babies less than 12 months old.
• Working at night.
• Attending long-distance business trips.
• If pregnant women are involved in heavy-duty work, their work time should be decreased by an hour, or they should switch to lighter work (pay should remain the same).

When we consider the Vietnam Labour Law for minor employees under 18, there are specific rules and regulations to consider. They are as follows:

• Minors under 18 cannot work in dangerous or toxic conditions or overtime.
• Minors cannot work on specific restricted industries and tasks defined by the Ministry of Labour.
• Minors between the ages of 15 and 18 can only work a maximum of 8 hours per day, 40 hours per week, limited overtime, and night work.
• Minors under 15 can work a maximum of 4 hours per day, 20 hours per week, and no overtime or night work.

Final Thoughts

In conclusion, overtime in Vietnam has specific rules and regulations you must follow whether you are an employee or an employer. By understanding these regulations, employers can ensure a fair work environment while the employees know their rights and get paid.

We hope this guide helped us understand how overtime in Vietnam works!