According to the Labour Code, the Employee working under the LC with an indefinite-term has the right to unilaterally terminate the LC in all cases as long as the notice is given to the Employer prior to at least 45 days. Therefore, regardless of whether the Employer agrees or not with the Employee’s request, the LC with an indefinite-term will also be terminated immediately after the expiration of the 45-day notice period mentioned above. If the Employee changes his or her mind before the expiration of the notice period, he or she still has the right to rescind his or her unilateral termination by sending a written notice to the Employer and this rescission will only be effective if the Employer is on the same mind.
If the Employer agrees to cancel the request of LC unilateral termination sent by the Employee within the prior notice period, the Employer should note that the signed indefinite-term LC will continue to be valid and bind the parties. Therefore, in principle, it is beneficial to the Employee, the Employer will not have the right to agree with the Employee to change the type of LC from indefinite-term to definite-term. The conclusion of a definite-term LC to replace an indefinite-term LC can expose the Employer to legal risks when the Employee has a complaint or lawsuit to the competent labour management State agency or Court. In addition, the Employer is also subject to an administrative sanction ranging from VND4,000,000 to VND50,000,000 for failing to enter into the right type of LC, depending on the number of affected Employees.
However, the Employer can still consider concluding a new definite-term LC with the Employee if the Employee has completely terminated the indefinite-term LC according to the provisions of the labour law. Then, the conclusion of a new definite-term LC will be considered as the legal basis for starting a new labour relationship between the Employer and the Employee, independent of the previously terminated labour relation. As mentioned above, the Employer has the full right to decide whether or not to continue the labour relation with the Employee exercising the right to unilaterally terminate his or her LC. Therefore, in order to minimise legal risks in entering into a new definite-term LC with the Employee, the Employer should not give any response showing the Employer’s consent to the proposal to cancel unilateral termination of the Employee’s LC within the prior notice period. In addition, in order to ensure that the LC is terminated completely, the Employer also needs to fulfil the obligations of the Employer upon the termination of the LC, including payment of Employee-related benefits, completion of confirmation, and return to the Employee’s social insurance book and other documents that the Employer has kept from the Employee. Accordingly, the conclusion of definite-term LC with the Employee should also be conducted after a certain reasonable period of time (usually after 07 days) from the date of LC termination to avoid the case that the Employee accurately signs the definite-term LC due to misunderstood with the replacement of the previous indefinite-term LC. In addition, the Employer should also post the recruitment for that position and the Employee will directly apply for the position and the Employer will take steps in accordance with the general recruitment process and procedures of the enterprise (for example test, interview, probation contract (if necessary), re-sign a new term LC).
Article 35 of the Labour Code
Article 38 of the Labour Code
Articles5 and 8 of Decree No. 28/2020/ND-CP of the Government
Articles 48.2 and 48.3 of the Labour Code