International Labor & Employment Law Committee Newsletter

Issue: April 2013

Editor: Tim Darby | Africa and Middle East Editor: Karen Seigel | Asia and Oceania Editor: Ute Krudewagen | Canada Editor: Gilles Touchette | European Editor: Paul Callaghan | Latin America Editor: Juan Carlos Varela | Law Student Editor: Irene Lehne, Earle Mack School of Law at Drexel University


Amended Regulations on Unemployment Insurance Effective January 15, 2013

Dang The Duc, Managing Partner, and Nguyen Ngoc Oanh, Legal Assistant, Indochine Counsel, Hanoi, Vietnam

Effective January 15, 2013, the statute of limitation for the registration of unemployment insurance increased, subjects ineligible for unemployment insurance were added and guidelines on the calculation of unemployment insurance contribution were implemented, according to Decree No. 100/2012/ND-CP ("Decree 100"). Decree 100 amends and supplements some articles of Decree No. 127/2008/ND-CP ("Decree 127") dated December 12, 2008, providing detailed regulations and guidelines on some articles of unemployment insurance stated in the Law on Social Insurance as discussed below.

Registration of Unemployment Insurance of the Worker

Within 3 months of the date of unemployment or termination of the employment contract, if the employee still remains unemployed and wishes to continue receiving unemployment allowances, the employee will be required to register his or her status with the labor agencies.

Within 15 working days after registering for unemployment the unemployed worker must submit his or her record of having received any unemployment insurance benefit and present his or her social insurance book or certification of social insurance agencies as a proof of having paidunemployment insurance.

Widening Categories of Individuals Ineligible for Unemployment Insurance

Ineligibility for unemployment insurance has been widened to:

  • On-leave employees due to maternity or sickness for 14 or more working days per month, not enjoying monthly salaries; and
  • Employees temporarily postponing labor contracts due to reasons prescribed by law (i.e. the employee is called for military service, is under temporary arrest or detainment, or the postponement of the labor contract is made by the mutual agreement between the parties).

Guideline on Calculation of Unemployment Insurance

Decree 100 also provides for specific guidelines on calculating the time for unemployment insurance contributions. In particular, the contributing time shall be legally counted in case both the employee and the employer have paid unemployment insurance for a full 12 months or more within 24 months before the termination of employment. In addition, in the month in which employment started, the employee only has to have worked one day in order for that month to count as a full month.

New Labor Code Continues Protections for Business Secrets and Confidential Information

Dang The Duc, Managing Partner, and Nguyen Ngoc Oanh, Legal Assistant, Indochine Counsel, Hanoi, Vietnam

Provisions related to inappropriate disclosure of business secrets are continued in the new Vietnamese Labor Code effective May 1, 2013,1 as in the prior labor code.2

The Intellectual Property Law ("IP Law") passed in Vietnam in 20053 provides that business secrets are secrets maintained at the effort of the owner by necessary means so that they shall not be disclosed, nor easily accessible.

The old and new Labor Codes stipulate that a company's Internal Labor Regulations ("ILR") must contain articles on the protection of business secrets and the confidentiality of technology and intellectual property of the employer. At the employer's discretion, this article may be construed under the definitions of business secrets and confidential information as prescribed in the IP Law; obligations of confidentiality of employees; and the scenarios in which the employer may inspect letters, emails, telegrams and other documents of an employee using the company's address or account.

As an integral part of a company's labor management, the ILR containing such provisions is required to be provided to employees by posting it at necessary locations in the workplace. This regulation of the Labor Code imposes an obligation on the employee byrecognizing the validity of the employer's business secrets and intellectual property during employment in the company.

Provisions in Labor Contracts

While the Labor Code requires employers to outline their policies concerning confidential information in the ILR and any relevant training documents, companies often include such policies in the labor contract itself, especially for employees who work directly with business secrets or confidential information. The agreement on confidentiality is normally included in the terms and conditions but may be enhanced to include language covering the treatment of business secrets and the damages owed by the employee who violates such terms.

Vietnamese law contains no restriction on employees who possess knowledge, confidential information or business secrets gained from their employment for a competitor. In practice, however, many companies require their employees to make a commitment of not disclosing confidential information or trade secrets within a certain time frame of leaving the company.

Dismissal and Damages

As the unauthorized disclosure of business secrets by the employee may result in economic losses to the company, the past and new Labor Codes stipulate that violation of confidentiality in this manner should be dealt with by dismissal. Within 12 months of the date of breaching labor discipline on trade secrets, the employer is required to deal with this breach and make a decision on the consequences for the employee.

1Law No.10/2012/QH13 dated June 18, 2012.

2Labor Code dated June 23, 1994, amended and supplemented in 2002, 2006 and 2007.

3Law No. 50/2005/QH11 of the National Assembly dated December 12, 2005, on Intellectual Property, as amended by Law No.36/2009/QH12 dated June 19, 2009.

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