A removed director is a case of two legal relationships stacked on one person: the corporate-governance relationship creating the office, and the labour relationship creating the salary — removal cuts the first, not automatically the second. This is a question that legal and finance teams of enterprises in Vietnam must answer in writing and with evidence, not by word-of-mouth experience.
The legal framework in force
Enterprise Law 59/2020/QH14 (as amended) governs appointment, removal and dismissal of directors or general directors by the board of management or members’ council under the company charter; a removal decision is effective in the governance relationship without needing a labour ground. Removal and labour-contract termination are two decisions to issue separately. In parallel, if the director works under a labour contract with the company, that relationship sits under Labour Code 45/2019/QH14: termination must still fall in an Article 34 case, observe notice and generate Article 46 severance — or Article 41 consequences if unilateral and unlawful. Removal compensation lives in contracts and the charter, not in one common statutory formula. Where the director is a capital-contributing member appointed to manage without a separate labour contract, purely office-and-management disputes follow enterprise law and the charter, resolved in court as commercial cases or by arbitration if the charter and agreements so provide. Classifying each claim correctly is the step that decides jurisdiction.
Application to the enterprise’s file
- Removal and labour-contract termination are two decisions to issue separately. A removal resolution valid under enterprise law does not by itself end the labour contract; an employer skipping the separate labour-law termination decision faces reinstatement or Article 41 compensation claims from the very person just removed.
- Removal compensation lives in contracts and the charter, not in one common statutory formula. Unlike ordinary employees with the Article 41 and 46 scales, a director’s ‘loss of office’ compensation exists only if the labour contract, management contract or charter promised it — a term to negotiate at appointment, not at removal.
- The forum splits by claim inside the same affair. A claim to annul the removal resolution follows enterprise law, while salary and severance claims follow labour law with its mediation step; merging everything into one petition is the surest way to get part of the file returned.
Action checklist
- Issue both documents simultaneously on separate bases and check the charter for who signs each.
- When drafting senior-manager contracts, record the early-removal regime including notice, payments and handover duties.
- Split the affair into two claim lists from the start and file each list through its own sequence.
Bottom line
The key point on manager director disputes labour law or enterprise law Vietnam removal is not to follow another enterprise’s practice: each case must be checked against its own contracts, files and notices.
Frequently Asked Questions
Which law governs a director’s dispute with the company?
In principle: Removal and labour-contract termination are two decisions to issue separately. A removal resolution valid under enterprise law does not by itself end the labour contract; an employer skipping the separate labour-law termination decision faces reinstatement or Article 41 compensation claims from the very person just removed. Main bases: Enterprise Law 59/2020/QH14 (appointing and removing directors under the charter); Labour Code 45/2019/QH14 Articles 34, 41 and 46 for the parallel labour-contract relationship. If authority is unclear, ask in writing.
What about removal versus labour-contract termination?
The distinction that matters: Removal compensation lives in contracts and the charter, not in one common statutory formula. Unlike ordinary employees with the Article 41 and 46 scales, a director’s ‘loss of office’ compensation exists only if the labour contract, management contract or charter promised it — a term to negotiate at appointment, not at removal. Main bases: Enterprise Law 59/2020/QH14 (appointing and removing directors under the charter); Labour Code 45/2019/QH14 Articles 34, 41 and 46 for the parallel labour-contract relationship. Fix verbal understandings in writing.
Is compensation owed on removal?
From the actual file’s perspective: The forum splits by claim inside the same affair. A claim to annul the removal resolution follows enterprise law, while salary and severance claims follow labour law with its mediation step; merging everything into one petition is the surest way to get part of the file returned. Main bases: Enterprise Law 59/2020/QH14 (appointing and removing directors under the charter); Labour Code 45/2019/QH14 Articles 34, 41 and 46 for the parallel labour-contract relationship. Keep supporting records year by year.
Where is the case filed?
Short answer: Removal and labour-contract termination are two decisions to issue separately. A removal resolution valid under enterprise law does not by itself end the labour contract; an employer skipping the separate labour-law termination decision faces reinstatement or Article 41 compensation claims from the very person just removed. Main bases: Enterprise Law 59/2020/QH14 (appointing and removing directors under the charter); Labour Code 45/2019/QH14 Articles 34, 41 and 46 for the parallel labour-contract relationship. Check this against the enterprise’s file first.
This article has been quality-reviewed by the FLAW AI Legal Council