An employment contract is the legally binding document setting out the rights and obligations between an enterprise and an employee, and it is the first point of reference the labour inspectorate and the courts examine when a dispute arises. A contract drafted under the wrong type, missing mandatory content, or signed by someone without proper authority may be declared void in whole or in part, with knock-on consequences for social insurance, personal income tax and disciplinary action. This article sets out the core rules an enterprise needs to know when entering into an employment contract in 2026.
Types of employment contract under the 2019 Labour Code
The 2019 Labour Code (effective from 1 January 2021) reduced the number of employment contract types compared with the previous law, leaving only two:
- Indefinite-term employment contract: the parties do not agree on a term or an expiry date for the contract.
- Definite-term employment contract: the parties agree on a term and an expiry date not exceeding 36 months from the date the contract takes effect.
The seasonal or specific-task contract with a term of under 12 months — which existed under the previous law — has been abolished. An enterprise hiring seasonal labour can now only use a short definite-term contract or another form of civil cooperation, depending on the nature of the work.
When a definite-term contract expires and the employee continues working, the parties must sign a new contract within the statutory period; if they do not, the existing contract automatically becomes an indefinite-term contract. An enterprise may also enter into a definite-term contract with the same employee only one further time (except in certain specific cases); the next contract must be an indefinite-term contract.
Mandatory content of the contract
An employment contract must contain all the principal content required by law, at a minimum:
- The enterprise's name and address, and the full name and title of the person signing the contract on the enterprise's behalf.
- The employee's full name, date of birth, gender, place of residence, and citizen identification or passport number.
- The job and the place of work.
- The term of the employment contract.
- The salary for the job or title, the form of payment, the payment schedule, salary allowances and other supplementary payments.
- The regime for salary grade increases and pay rises.
- Working hours and rest breaks.
- Provision of labour protective equipment for the employee.
- Social insurance, health insurance and unemployment insurance.
- Training, professional development and improvement of qualifications and occupational skills.
Missing any of these items does not automatically render the contract void, but it gives the labour inspectorate grounds for a penalty and puts the enterprise at a disadvantage in a dispute, since courts tend to apply the interpretation more favourable to the employee when a contract is unclear. An enterprise should review its contract template periodically, especially when it changes its salary or allowance policy or its working arrangements (remote work, part-time work).
Rules on probation
Probation is not a mandatory step in every recruitment. The parties may agree on probation terms directly within the official employment contract, or sign a separate probation agreement. Probation does not apply to an employment contract with a term of under one month.
The probation period is capped according to the nature of the job; the 2019 Labour Code sets four ceilings, corresponding to enterprise management positions, positions requiring a college-level qualification or higher, positions requiring an intermediate-level qualification, technical worker or professional staff qualification, and other jobs. An enterprise may only probate an employee once for a given job; agreeing to repeat probation or extending it beyond the statutory ceiling is a violation that can be penalised, and the employee has the right to require an immediate move to the official contract.
Probationary salary is agreed by the parties but must guarantee a minimum proportion of the salary for the same job once confirmed. At the end of the probation period, the enterprise must notify the result: if the employee passes, the parties continue performing the contract already signed (where probation was agreed within the main contract) or sign the employment contract (where there was a separate probation agreement); if the employee fails, either party may cancel the agreement without compensation, except for training costs if separately agreed.
Form of the contract (including electronic contracts)
As a rule, an employment contract must be entered into in writing, prepared in two copies, with each party retaining one. An important change under the 2019 Labour Code is that a contract concluded through electronic means in the form of a data message is recognised as having the same legal validity as a written contract — opening the way for remote recruitment and signing processes, particularly for employees based away from the office or working in a hybrid arrangement. From 1 January 2026, Decree 337/2025/ND-CP sets out more detailed rules on electronic employment contracts: it requires digital signatures and timestamping services, and encourages enterprises to connect through the National Electronic Employment Contract Platform managed by the Ministry of Home Affairs (not mandatory for every enterprise — it applies only where an enterprise chooses the electronic form).
The parties may only conclude a contract orally where the term is under one month, except for certain cases the law requires to be in writing regardless of the short term (employees under 15 years of age together with their legal representative, domestic workers, and certain other specific groups). An enterprise using electronic contracts should pay attention to its storage infrastructure and to ensuring its digital signature or authentication method is sufficient to prove legal validity in the event of a dispute or an inspection.
Errors that render a contract void
An employment contract may be declared void in its entirety in three cases: the entire content of the contract violates the law; the person who signed the contract lacked proper authority or violated the principle of voluntary, equal and good-faith agreement; or the job agreed in the contract is one that the law prohibits. A contract is void in part where the content of that part violates the law but does not affect the remaining parts of the contract.
Common errors in practice include: the person signing on the enterprise's behalf is not its legal representative and has no valid power of attorney; the job agreed falls within the list of prohibited job categories (minors, pregnant female employees in certain positions); or the agreed salary is below the regional minimum wage. The authority to declare a contract void rests with the people's court, and once a contract is declared void, the parties' rights and obligations are settled under the law, usually to the enterprise's disadvantage — reviewing signing authority and job content before signing is therefore the single most important preventive step.
Frequently asked questions
Is an enterprise required to sign an employment contract in writing? Yes, except that a contract with a term of under one month may be concluded orally, other than for certain groups of employees the law requires to be in writing regardless of the short term.
Does an electronic employment contract have the same legal validity as a paper contract? Yes. A contract concluded through electronic means in the form of a data message is recognised as having legal validity equivalent to a written contract under the 2019 Labour Code.
Can an employee be put on probation more than once for the same position? No. Each job may only carry one probation period; if this is violated, the enterprise may be penalised and the employee has the right to require a move to the official contract.
Who has the authority to declare an employment contract void? The people's court is the only body with the authority to declare an employment contract void in whole or in part.
Book a consultation with TLA Consulting to review your enterprise's employment contract template and recruitment process.
