In early 2026, a plastic components factory commissioned an automated line replacing 60% of manual assembly labor. The list of 50 workers to be let go, approved by management, shared one suspicious trait: all were aged 50 or older, while workers under 35 — with less seniority — were all kept to be “trained on the new machines.” A 54-year-old woman with 22 years of service broke down: “I have been here since the factory opened; now they say I am too old to learn the new machines.” The union asked: is this lawful restructuring or age discrimination?
Automation is an inevitable trend, and the law allows employers to change organizational structure and technology. But “technological change” is not a blanket license for every staffing decision — especially when the keep-or-go criterion is age.
The legal basis: no discrimination, and the technology-change procedure
Article 8 of the Labor Code 2019 (Law No. 45/2019/QH14) prohibits discrimination in labor; Articles 150–151 on elderly employees encourage employers to keep employing them rather than discard them. Using age as the selection criterion for redundancy — while younger, less experienced workers are retained — is a clear sign of age discrimination.
On procedure, Article 44 of the Labor Code 2019 requires employers changing structure or technology to build a labor utilization plan: prioritize retraining for continued employment, or transfer workers to other jobs. Only when no new placement is possible may the employer terminate multiple workers — after consulting the employee representative organization and notifying the provincial labor authority (now the Department of Home Affairs) and the workers 30 days in advance.
Affected workers receive job-loss allowance under Article 47: one month’s wage per year of service, at least two months’ wages. Discrimination in labor draws VND 5–10 million in fines under Point a, Clause 2, Article 11 of Decree 283/2026/ND-CP.
Where restructuring ends and discrimination begins
The law does not forbid redundancy for technological change — but it forbids age as the selection criterion. In the opening case, the employer made two compounding errors. First, skipping the retraining priority: “too old to learn new machines” is prejudice, not an individual capability assessment; the law requires giving workers a retraining opportunity before concluding they cannot meet new job requirements. Second, selecting redundancy candidates by age instead of objective criteria like qualifications, skills, performance appraisals and retrainability.
If the case reached court, the employer would have to prove objective selection criteria and a complete Article 44 labor utilization plan. With an “all over 50” list, that burden is nearly impossible — the termination decisions risk being declared unlawful, with reinstatement and Article 41 damages.
How to automate the right way
The standard process has four steps. Step one: build a written labor utilization plan listing affected workers, retraining plans, new positions and objective selection criteria (never age, gender or maternity status). Step two: consult the employee representative organization on the plan. Step three: give 30 days’ notice to the Department of Home Affairs and workers when mass redundancy is unavoidable. Step four: pay full job-loss allowances, close social insurance books, and support workers in finding new jobs — a legal duty and a corporate social responsibility.
Longer term, employers should run periodic retraining for older workers alongside technology investment, rather than thinking about people only when the machines arrive.
Frequently asked questions
Can the company force early retirement during automation?
No. Retirement ages follow the schedule in Article 169 of the Labor Code 2019. Employers may only terminate under the Article 44 technology-change procedure, with a full labor utilization plan and job-loss allowances.
What if retraining fails and the worker cannot cope?
Termination is possible if the employer proves serious retraining was organized, with objective assessment, and the worker genuinely cannot meet the new job’s requirements. Training records and assessment results must be kept as evidence.
What are lawful redundancy selection criteria?
Objective, verifiable criteria: professional qualifications, skills matching new jobs, performance appraisal results, retrainability, seniority. Age, gender, marital or maternity status must never be exclusion criteria.
Do older workers get priority to stay in restructuring?
The law grants no absolute priority, but Articles 150–151 encourage their continued employment, and no selection criterion may discriminate by age. Long seniority and hands-on experience are legitimate plus points in assessment.
Automation should be a story of higher productivity with people, not of discarding people. FLAT Law Firm helps employers build Article 44-compliant labor utilization plans for technological change — lawful, workforce-preserving, and reputation-protecting.
This article has been quality-reviewed by the FLAW AI Legal Council