An FDI plant director receives evidence that his foreign technical manager has passed product drawings to a competitor. The board wants a dismissal within the week, yet fears a familiar trap: miss one procedural step in the disciplinary process and the company must reinstate the employee, pay salary for the entire dispute period and add compensation on top. Foreign experts add a second layer: the work permit is tied to a specific position and employer, the labour contract cannot outlast the permit, and termination triggers notification duties toward the licensing authority.
The legal framework: dismissal is the heaviest disciplinary sanction and the most tightly controlled
Dismissal is not a free-standing right to end a contract; it is the highest form of labour discipline among the forms listed in Article 124 of the Labour Code No. 45/2019/QH14. Article 122 of the same Code sets the governing principles: the employee must be at fault, the fault must be proven, the employee must be able to present a defence, and the handling must be minuted. An employer may dismiss only in statutory cases, such as theft, embezzlement, disclosure of business or technology secrets, or conduct causing serious damage to the employer’s assets and interests.
For a foreign expert, Article 151 of the 2019 Labour Code states the conditions for foreign nationals to work in Vietnam, with a work permit as the baseline requirement save for exemption cases. Work permits are now governed by Decree No. 219/2025/ND-CP, which replaced Decree No. 152/2020/ND-CP. The practical consequence is that termination must be handled on two files at once, the labour file and the permit file, and a foreign employee’s contract term must never exceed the work permit’s validity, a detail often missed when contracts are renewed by habit.
Applying the framework: why FDI employers lose most dismissal cases
Most dismissal disputes employers lose are lost on procedure, not on whether misconduct occurred: no registered internal labour rules, or rules that do not cover the conduct; failure to invite the employee representative organization; unsigned or incomplete disciplinary meeting minutes; or dismissal imposed after the disciplinary limitation period expired. Foreign experts add an interpretation risk: if the allegations were never explained in a language the expert understands and the minutes exist only in Vietnamese, the expert can credibly argue the defence right under Article 122 was denied.
Where a court finds the dismissal unlawful, the financial consequences typically include reinstatement, back pay and insurance contributions for the days the employee was kept from work, additional compensation of at least two months’ salary, and, if the employee refuses to return, a negotiated payment on top of statutory severance. The company also faces administrative penalties in the labour field under Decree No. 283/2026/ND-CP, which replaced Decree No. 12/2022/ND-CP from 10 September 2026. A senior expert’s dismissal should therefore be prepared like litigation: secure evidence first, time system-access revocation correctly, and weigh a negotiated exit with above-statutory severance where the disciplinary evidence is not yet airtight.
Checklist before signing a dismissal decision for a foreign expert
- Match the alleged conduct against the registered internal labour rules and the dismissal cases in Article 124 of the 2019 Labour Code.
- Assemble objective proof of fault: incident reports, system logs, damage records and witness statements, kept separate from managers’ subjective assessments.
- Hold the disciplinary meeting with the correct composition, invite the employee representative organization, provide interpretation and record the employee’s defence.
- Check the disciplinary limitation period and the remaining work-permit validity before fixing the meeting date and the decision’s effective date.
- Price the worst case, reinstatement plus dispute-period salary plus compensation, and compare it with a negotiated termination before choosing the disciplinary route.
Frequently Asked Questions
What must we do to dismiss a foreign expert?
Follow the labour-discipline route strictly: confirm the conduct falls within the dismissal cases of Article 124 of the 2019 Labour Code, prove fault with objective evidence, hold a disciplinary meeting with the employee representative organization invited and the defence right under Article 122 protected, minute everything, and only then issue the decision. In parallel, review the registered internal labour rules and prepare the work-permit steps under Decree No. 219/2025/ND-CP once the decision takes effect.
How much compensation is owed for a wrongful dismissal?
If a court or competent authority finds the dismissal unlawful, the employer must reinstate the employee, pay full salary and insurance amounts for the period the employee was kept from work, and pay additional compensation of at least two months’ contractual salary. If the employee does not return, the parties negotiate a further sum beyond statutory allowances. The final figure depends heavily on how long the dispute lasts, because salary for the non-working period is the largest variable component.
Can a foreign expert sue in a Vietnamese court?
Yes. An individual labour dispute arising from employment in Vietnam falls within the jurisdiction of the Vietnamese people’s courts, after labour mediation save for categories that may be filed directly. A foreign expert enjoys full employee procedural rights: counsel, interpretation and evidence submission. Contract wording cannot strip away this jurisdiction over entitlements that are mandatory under Vietnamese law.
Must we report the termination of a foreign employee’s contract?
Yes. When a foreign employee’s contract ends, the employer must complete the notifications and foreign-labour usage reports to the labour authority and the permit-issuing authority under the mechanism of Decree No. 219/2025/ND-CP, and handle the work permit and the residence card tied to that position. Skipping this step records the company as non-compliant in its foreign-labour file and complicates permits for the replacement hire.
This article has been quality-reviewed by the FLAW AI Legal Council