In the context of many enterprises expanding their operations into Vietnam, the recruitment of employees—whether working remotely or on-site—raises important questions regarding employment contracts and legal compliance.

A well-drafted contract is not merely a procedural formality but serves as a legal safeguard protecting both the employer and the employee. First and foremost, businesses must clearly identify the stage of employment and the contracting entity. If the employee works online for a foreign parent company, the contract must clearly specify the scope of work, applicable benefits, and governing law.

When transitioning to the working phase in Vietnam, a new contract should be executed with the Vietnamese subsidiary, in full compliance with the Labor Code and relevant local regulations. A comprehensive employment contract should not only define salary and working hours but also include detailed provisions on social insurance, leave entitlements, employee benefits, and tax obligations.

These elements are often overlooked but have a direct impact on the employee’s rights and the employer’s legal responsibilities. Therefore, it is essential that businesses seek specialized legal advice during the drafting stage to prevent future risks. Moreover, attention should be paid to cross-border contractual risks—such as governing law, dispute resolution mechanisms, and intellectual property rights related to remote work products.

Even a minor difference in contractual wording can lead to complex disputes later on. In summary, the management and execution of employment contracts are not solely about compliance but also about effective risk management. Enterprises should proactively establish transparent and well-structured contractual systems aligned with Vietnamese law to ensure sustainable growth and protect the interests of both parties in the employment relationship.