This article explains Vietnam's labor unions and labor dispute resolution, based on the revised law that came into effect in July 2025.
Key Points
1. Two-Tier Structure of Worker Representative Organizations
- Traditional trade unions affiliated with the Vietnam General Confederation of Labor (VGCL)
- "Workers' organizations at enterprises" not affiliated with VGCL are now permitted
- Introduction of new concept "grassroots-level worker representative organizations" encompassing both
- Establishment of workers' organizations at enterprises requires registration with competent state authorities, but implementation regulations are not yet enacted
2. Revised Trade Union Law Effective July 2025
- New procedures for workers' organizations at enterprises to join under VGCL umbrella (Article 6)
- Maintained employer's contribution of 2% of basic salary as union fees (Article 29, Paragraph 1, Item b)
- Foreign workers with labor contracts of 12 months or more permitted to join grassroots-level trade unions (Article 5)
- Established provisions for distributing trade union funds to workers' organizations at enterprises (Article 31, Paragraph 4)
3. Individual Dispute Resolution System
- Mediation by labor mediators (mandatory in principle, within 5 business days)
- Disciplinary dismissal and ordinary dismissal are exceptions to mandatory mediation
- Labor Arbitration Council (available by mutual agreement, decision within 30 days)
- Filing lawsuit in court
- Grassroots-level worker representative organizations can file lawsuits on behalf of workers by authorization
4. Collective Disputes and Strikes
- Divided into rights-related disputes and interest-related disputes
- Collective bargaining: Organization with the largest membership holds bargaining rights, negotiation period within 90 days
- Legal strikes require mediation/arbitration, consultation (50% or more approval), notification 5 business days in advance, etc.
- In practice, many strikes are conducted without following legal procedures
5. Impact on Corporate Practice
- Disciplinary procedures: Participation of grassroots-level worker representative organization representatives required
- Work rules: Companies with 10 or more employees must register with authorities, consultation with grassroots-level worker representative organizations required
- Union fees: Obligation to pay 2% of basic salary regardless of presence of enterprise union
- Mass layoffs: Discussion with grassroots-level worker representative organizations required
The article concludes that the revised law indicates a direction of incorporating workers' organizations at enterprises into the VGCL system, and that daily dialogue and relationship building are important for stabilizing labor-management relations.