Labour leasing is a conditional business line, not a free staffing arrangement between two companies. A leasing enterprise must hold an operating licence, maintain a bank deposit, and may only supply workers for jobs on the statutory list. This article analyses the licence conditions, the consequences of operating without one for both the leasing firm and the client, and the regularisation paths for existing arrangements.
Licence conditions for labour leasing
Under Articles 52 to 58 of the Labour Code and Decree 145/2020/ND-CP, a labour leasing enterprise must hold a labour leasing operation licence, whose core conditions are a deposit of VND 2 billion at a commercial bank securing obligations toward workers, and a legal representative meeting statutory experience and record requirements. The licence runs for a maximum of 60 months and is renewable by statutory procedure. An enterprise leasing labour without a licence is conducting a conditional business without meeting its conditions.
The scope of activity is locked along two axes. The job axis: workers may only be leased into jobs on the government-prescribed list — seasonal work, temporary replacement and auxiliary support roles. The time axis: the lease term for one worker at one client enterprise is at most 12 months. A licensed enterprise leasing outside the list or beyond the term also violates the rules, though with lighter consequences than operating wholly unlicensed.
Consequences of operating without a licence
On sanctions, unlicensed labour leasing is administratively punishable in the labour field under the current sanctions decree at significant levels scaled to the operation, with possible orders to cease the unlawful leasing activity and settle consequences for workers currently leased. The client using workers from an unlicensed provider also faces handling within its own scope and direct legal risk toward the very workers on its premises.
On the civil side, a leasing contract signed with an unlicensed provider risks being declared void for breaching statutory business conditions and prohibitions. When the contract is void, the real relationship between the worker and the client enterprise — where the worker actually works, takes instructions, and is paid through the intermediary chain — becomes the dispute’s centre: the worker has grounds to seek a direct employment relationship with the client, or to hold the leasing firm to full employer obligations for wages, insurance and regimes, while the two companies cannot use the void contract to shift risk between themselves against the worker.
Regularisation paths for existing unlicensed arrangements
An enterprise currently leasing without a licence has two practical exits. One is completing the conditions and obtaining the licence — deposit, regularising the representative’s file, and auditing all running contracts against the permitted job list and the 12-month ceiling. The other is converting the model: ending leasing activity and replacing it with direct employment or a genuine services contract whose object is work results, not people — provided the conversion changes the substance of the relationship, not just the contract’s name while operations stay identical.
Clients currently using workers from an unlicensed provider should act now in self-protection: verify the partner’s licence before renewing any contract, require evidence of the deposit and the permitted job list, and prepare to take key positions in-house directly. In a labour supply chain, the provider’s licence is the first and cheapest due-diligence document — far cheaper than handling the consequences when labour inspectors find an entire outsourced crew working under a void contract.
Frequently Asked Questions
What are the penalties for leasing labour without a licence?
It is conducting a conditional business without meeting its conditions, administratively sanctioned in the labour field under the current decree at levels scaled to the operation, with possible orders to stop the unlawful leasing and settle consequences for currently leased workers. The client using workers from an unlicensed provider also bears risk and handling within its related scope.
What conditions must be met for a labour leasing licence?
Under Decree 145/2020/ND-CP the enterprise must deposit VND 2 billion at a commercial bank, its legal representative must meet statutory experience and record conditions, and the licence application file must be completed as prescribed. The licence lasts at most 60 months. Even licensed, activity must stay within the permitted job list and the 12-month maximum lease per worker.
Is a leasing contract with an unlicensed provider void?
It carries a high risk of being declared void for breaching statutory business conditions. The worker actually working at the client then has grounds to claim protection directly: establishing an employment relationship with the enterprise actually using their labour, or holding the leasing firm to full wage, insurance and regime obligations as the employer.
What should a company using an unlicensed provider’s workers do?
Check the partner’s licence and deposit evidence immediately, compare the leased jobs against the permitted list and each worker’s leased duration against the 12-month ceiling. Prepare to move key positions to direct employment or require the partner to complete licensing before any renewal, rather than continuing a relationship at risk of invalidity.
Practical recommendations
In labour leasing, the licence is not decorative paperwork but the existence condition of the entire model: without it, every contract in the chain stands on void ground. Both providers and client enterprises should put licence, deposit and job-list verification into annual due diligence, exactly as for any other conditional business licence.
This article has been quality-reviewed by the FLAW AI Legal Council