Internal labor regulations (nội quy lao động or ILR) constitute the foundational legal framework governing workplace discipline and personnel management in Vietnam. For foreign-invested enterprises (FDI), issuing and registering a compliant ILR is the sole legal prerequisite for enforcing disciplinary measures, demotion, wage increment freezes, or lawful dismissal.
Without registered ILR, employers possess zero legal standing to discipline non-compliant staff, and any unilateral termination will be invalidated by Vietnamese labor courts.
1. Mandatory Thresholds for Written ILR Issuance and Registration
Pursuant to Articles 118 and 119 of Labor Code 2019 (Law No. 45/2019/QH14), employer obligations are categorized strictly by workforce size:
- Enterprises with 10 or more employees: Must issue written ILR. Within 10 days from issuance, the employer must submit a registration dossier to the provincial Department of Labor, Invalids and Social Affairs (DOLISA) or the authorized Industrial Zone Management Authority.
- Enterprises with fewer than 10 employees: Not required to issue written ILR; disciplinary rules and material liabilities can be incorporated directly into individual labor contracts. If an employer issues written ILR voluntarily, registration is optional.
Statutory Effective Date (Article 121): The ILR becomes effective 15 days after the competent labor authority receives the complete, valid registration dossier. Effectiveness is determined strictly by the dossier receipt date, not the subsequent issuance of an acknowledgment notice. If statutory defects are identified, the authority must issue written amendment guidance within 07 working days.
2. Nine Statutory Mandatory Provisions Under Article 118 Labor Code
Labor authorities accept registration filings only when the ILR incorporates all nine statutory components prescribed under Article 118(2) of Labor Code 2019 and Article 69 of Decree 145/2020/ND-CP:
| Item | Mandatory domain | Legal basis & Core requirements | FDI compliance notes |
|---|---|---|---|
| 01 | Working hours and rest periods | Art. 118(2) LC; Art. 69 Dec. 145/2020. Caps: 8h/day, 48h/week; OT ≤40h/month, 200-300h/year | Detail shift schedules, breaks, and voluntary overtime consent |
| 02 | Workplace order | Operational scope, professional conduct, facility entry rules | Prohibit parent company rules that violate Vietnamese laws |
| 03 | Occupational safety and health | Law on OSH 2015; protective equipment (PPE), fire safety | Mandatory for factories; establish emergency workflows |
| 04 | Sexual harassment prevention | Art. 84-86 Dec. 145/2020. Definitions, reporting, inquiry protocols | Mandatory; missing this causes immediate filing rejection |
| 05 | Asset and trade secret protection | Safeguarding technology, intellectual property, BYOD rules | Financial penalties and wage deductions are strictly banned |
| 06 | Temporary job reassignment | Art. 29 LC 2019. Max 60 days/year; minimum 3-day notice | Specify force majeure, disasters, or unexpected operational needs |
| 07 | Disciplinary violations and penalties | 4 statutory forms: Reprimand, Deferral (≤6 mos), Demotion, Dismissal | Dismissal is invalid if offenses are not specified in registered ILR |
| 08 | Material liability | Art. 129-130 LC. Property indemnity; deduction capped at ≤30% net pay | Define objective damage valuation and repayment terms |
| 09 | Disciplinary authority designation | Specific title authorized to sign decisions (Legal Rep or Delegate) | Formal power of attorney must be valid on the decision date |
Critical Filing Rejection Alert:
Omitting detailed internal protocols on workplace sexual harassment prevention (Articles 84-86 Decree 145/2020/ND-CP) and stipulating illegal salary deduction penalties (violating Article 127 Labor Code) represent the two most common reasons DOLISA rejects FDI ILR dossiers.
3. Step-by-Step Registration Procedure and Statutory Dossier with DOLISA
Registering an ILR requires strict adherence to the statutory timeline outlined in Articles 119 and 120 of Labor Code 2019:
- Draft ILR in Vietnamese: FDI enterprises may create a bilingual version for internal operations, but the Vietnamese text possesses sole legal validity in disputes.
- Consult employee representative organization: Written consultation with the executive committee of the grassroots trade union or employee organization is mandatory.
- Execute issuance decision: The company legal representative formally signs the promulgation decision.
- Submit dossier within 10 working days: Submit one complete application dossier to DOLISA or the authorized Industrial Zone Authority.
- Effective implementation: In the absence of an amendment request within 07 working days, the ILR takes effect 15 days after valid dossier receipt.
Mandatory Registration Dossier Under Article 120 Labor Code 2019
| Dossier document | Quantity | Statutory requirements & Review criteria |
|---|---|---|
| Written application for ILR registration | 01 original | Signed by legal representative and affixed with company seal |
| Internal labor regulations text | 01 original | Drafted in Vietnamese (accompanied by bilingual translation if applicable) |
| Trade union consultation minutes | 01 original | Formal minutes recording comments of grassroots employee representatives |
| Related internal regulations | 01 copy set | Internal safety regulations, collective bargaining agreements (if applicable) |
Once effective, the ILR must be publicly displayed at work premises and distributed to all employees. Without proof of delivery, employers cannot legally cite the ILR for disciplinary enforcement.
4. Four Permissible Disciplinary Measures and Prohibited Sanctions
Article 124 of Labor Code 2019 prescribes an exhaustive list of four permissible disciplinary measures: (1) Reprimand; (2) Deferment of wage raise for up to 06 months; (3) Demotion; and (4) Dismissal.
Statutory Grounds for Dismissal (Article 125): (1) Theft, embezzlement, gambling, deliberate infliction of injury, drug use at work; (2) Disclosing business/technological secrets, infringing IP, or causing severe property damage; (3) Recidivism during an unspent discipline period; (4) Unauthorized absence of 05 cumulative working days in 30 days or 20 cumulative working days in 365 days without valid reasons.
Prohibited Disciplinary Sanctions (Article 127): (1) Infringing upon employee health, honor, or dignity; (2) Imposing fines or salary deductions in lieu of discipline; (3) Disciplining offenses not specified in registered ILR or contracts; (4) Applying multiple disciplinary measures for a single offense.
Workflow and Statute of Limitations (Articles 122-123): Disciplinary hearings require 05 working days advance notice and mandatory employee representative attendance. The general limitation period is 06 months, extendable to 12 months for offenses directly affecting company assets or trade secrets.
5. Corporate Administrative Penalty Exposure Under Decree 12/2022/ND-CP
Non-compliance with ILR issuance, registration, or disciplinary rules triggers corporate administrative fines under Article 19 of Decree 12/2022/ND-CP (doubled for organizations pursuant to Article 6(1)):
| Violation domain | Legal basis | Corporate fine (VND) | Legal remedies & Corrective orders |
|---|---|---|---|
| Failure to publicly post ILR | Art. 19(1) Dec. 12/2022 | 1,000,000 - 2,000,000 | Mandated public posting at work premises |
| Failure to issue written ILR (10+ workers) | Art. 19(2)(a) Dec. 12/2022 | 10,000,000 - 20,000,000 | Mandated issuance of written ILR |
| Failure to register ILR with authority | Art. 19(2)(b) Dec. 12/2022 | 10,000,000 - 20,000,000 | Immediate filing; forfeiture of dismissal rights |
| Unlawful provisions in ILR | Art. 19(2)(c) Dec. 12/2022 | 10,000,000 - 20,000,000 | Clause voided; disciplinary rulings revoked |
| Imposing fines or salary deductions | Art. 19(4)(b) Dec. 12/2022 | 40,000,000 - 80,000,000 | Mandated refund of deducted sums plus interest |
| Disciplining unlisted offenses | Art. 19(4)(c) Dec. 12/2022 | 40,000,000 - 80,000,000 | Ruling revoked; reinstatement and back-pay ordered |
| Infringing employee dignity or health | Art. 19(4)(a) Dec. 12/2022 | 40,000,000 - 80,000,000 | Mandatory public apology and damages settlement |
The paramount financial exposure for FDI is the loss of lawful dismissal standing. Vietnamese labor courts consistently void dismissals when the employer lacks registered ILR or when the offense was omitted from the registered text. Upon losing an unlawful termination suit, the employer must reinstate the employee, pay all back wages, settle compulsory social insurance arrears, plus pay statutory indemnity of at least two months of salary.
6. Strategic ILR Risk Management and Compliance Controls for FDI
To mitigate legal liabilities, foreign-invested enterprises should implement four core risk controls:
- Localize parent corporate handbooks: Never directly translate global handbooks into Vietnamese. Provisions prescribing wage deductions for tardiness or termination without cause violate Vietnamese labor law.
- Define misconduct with quantifiable precision: General phrases such as “serious misconduct” are legally unenforceable. Grounds for dismissal must be defined objectively with specific metrics and evidence standards.
- Maintain auditable proof of employee delivery: Secure signed physical acknowledgment receipts or verified electronic acknowledgments from 100% of staff upon onboarding.
- Audit and re-register upon operational shifts: Whenever work schedules, shift rotations, or safety policies change, the company must execute formal amendment procedures with DOLISA to ensure enforceability during labor dispute litigation.
ILR provisions operate in close synergy with statutory employee termination workflows and must align with employment contract structuring to safeguard business operations.
Strategic ILR Drafting and Labor Registration Advisory by ICLV
Indochina Link Vietnam (ICLV) delivers comprehensive legal advisory for internal labor regulations and workforce compliance:
- Auditing global employee handbooks for full alignment with Vietnamese labor laws.
- Drafting bilingual ILR incorporating all nine mandatory statutory domains.
- Facilitating trade union consultations and direct liaison with DOLISA and Industrial Zone Authorities.
- Structuring legally defensible disciplinary hearing workflows and dismissal documentation.
Contact our specialist team via email at info@indochinalink.com or explore our payroll and HR advisory services.
Legal disclaimer: This guide provides general professional context current as of September 2026. Employers should obtain qualified legal counsel for specific labor disputes.
