A common situation
A foreign-invested LLC in Binh Duong has just hired Mr. J., a U.S. national, as Chief Executive Officer. The HR department wondered: since Mr. J. is a director, is he exempt from a work permit, or must the company still apply for one?
This is a very common misunderstanding: many companies assume that holding the title of “director” automatically exempts a person from the work permit requirement. In reality, it does not.
Short answer
There is no automatic exemption based on the title “director”. A hired director — one who is not the owner or a capital contributor, and not a member of the Board of Directors — must still obtain a work permit, with the job position registered as “manager”.
Exemption applies only in the cases listed in Article 7 of Decree 219/2025/ND-CP (effective August 7, 2025, replacing Decree 152/2020). The principle: the title does not decide; the legal status does.
Case requiring a work permit: the hired director
If a foreigner is hired by the enterprise as an executive director, managed by the owner or the Board of Directors, this is an ordinary employment relationship. The enterprise must apply for a work permit for that person with the position of “manager”, following the full procedure applicable to other foreign workers.
Four exemption cases under Article 7 of Decree 219/2025
- Owner or capital-contributing member of the company, with a capital contribution of VND 3 billion or more. Note: the 3-billion threshold applies only to owners/contributors, not to hired directors.
- Working in Vietnam for less than 90 days in a year.
- Intra-corporate transferee: a manager, executive director, or expert of a foreign enterprise that has established a commercial presence in Vietnam, temporarily transferred within the corporation.
- Written confirmation from a ministry or sectoral authority that the case is not subject to work permit issuance.
Exempt cases still require 3-day prior notice
Even when a case is exempt from the work permit, the employer must still notify the competent authority at least 3 days before the foreign worker starts working (Article 9.4 of Decree 219/2025). Skipping this notice is still a violation.
Distinguishing the two kinds of “director”
- “Executive director” (hired person): appointed by the owner/Board of Directors, salaried — must obtain a work permit.
- “Company director” who is the owner or a Board member: may qualify for exemption under Article 7 if the conditions are met (for example, a capital contribution of at least VND 3 billion).
Checklist for employers
- Determine the foreigner’s legal status: hired person, or owner/contributor/Board member?
- If a hired director: apply for a work permit with the position “manager”.
- If claiming exemption: check each condition in Article 7 of Decree 219/2025, especially the VND 3 billion capital threshold (when relying on contributor status).
- Exempt cases still require 3-day prior notice to the competent authority.
- Cite the correct instruments: Decree 219/2025/ND-CP and Employment Law 74/2025/QH15 (not number 73/2025).
Contact us
If your company needs to determine whether a foreigner requires or is exempt from a work permit, or needs assistance with the work permit or exemption-notice procedure, FLAT Law Firm is ready to advise. Contact: contact us.
The information in this article is for general reference only and does not replace legal advice for your specific case.
Transparency note: The legal content of this article has been reviewed by the FLAW AI Legal Council and approved by the owner before publication. This article is not the opinion of a human lawyer who has reviewed your case.