Vietnam labor law changes have undergone several significant revisions since mid‑2025. For employers and employees, the most relevant developments include higher regional minimum wages, expanded social insurance and unemployment insurance coverage, major changes to personal income tax, higher social insurance contribution ceilings, and the continued digitalisation of employment records and contracts.

This Q3 2026 update explains the key changes and what they mean in practice for businesses, employers, and employees in Vietnam. It covers developments that took effect earlier in the year but continue to affect employment, payroll, tax, and social insurance compliance.

For employers, the practical issue is not any single change. Employment contracts, payroll records, tax filings, and social insurance records increasingly need to be consistent with each other as government systems become more connected.

Here is what changed and what you should check.

Regional Minimum Wage Rose About 7.2 Percent

Decree 293/2025/ND-CP took effect on January 1, 2026, replacing the previous minimum wage regulations. It increased the monthly regional minimum wage by VND 250,000 to VND 350,000 depending on the region, with an average increase of about 7.2 percent.

The new monthly minimum wages are:

• Region I: VND 5,310,000
• Region II: VND 4,730,000
• Region III: VND 4,140,000
• Region IV: VND 3,700,000

The applicable region depends on the specific location where the employee works. Employers should therefore check the detailed location list under Decree 293 rather than relying only on the name of a major city.

The increase also affects certain contribution ceilings linked to the regional minimum wage. Employers paying employees at or near the previous minimum wage should confirm that their payroll and employment contracts reflect the new rates.

Social Insurance Coverage Expanded

The Social Insurance Law No. 41/2024/QH15 took effect on July 1, 2025 and expanded the scope of mandatory social insurance. The changes include broader coverage of employees working under employment contracts and additional categories of people, including certain enterprise managers who do not receive a salary.

The rules for foreign employees are different from those for Vietnamese employees. In particular, foreign employees working in Vietnam are subject to mandatory social insurance when they meet the conditions set by the law, including the applicable employment contract requirements.

For employers, this means that social insurance eligibility should be reviewed employee by employee rather than determined only by job title or nationality.

Companies should also review managers, part-time employees, and other non-standard employment arrangements to confirm whether they fall within the mandatory social insurance system.

Unemployment Insurance Now Covers More Workers

The Employment Law No. 74/2025/QH15 took effect on January 1, 2026 and introduced important changes to unemployment insurance.

The new rules broaden mandatory unemployment insurance coverage to include, among others:

• Employees working under employment contracts of one month or more, subject to the conditions of the law
• Part-time employees who meet the applicable salary threshold
• Certain people working under agreements with different titles where the actual relationship has the characteristics of an employment relationship, including management, supervision, and direction by the employer

This is important for employers using contractors, consultants, or other non-standard arrangements. The legal classification of a working relationship depends on its actual nature, not simply the title used in the agreement.

The new law also provides an incentive for employers that hire people with disabilities. Subject to the applicable conditions, the employer’s unemployment insurance contribution for eligible newly hired employees with disabilities can be reduced to 0% for up to 12 months.

A New Personal Income Tax Law Takes Effect in 2026

The National Assembly passed Personal Income Tax Law No. 109/2025/QH15 on December 10, 2025. The law officially takes effect on July 1, 2026, with certain provisions applying from the 2026 tax year.

For employers, this means payroll and annual tax finalisation for 2026 need to account for the new rules and the applicable effective dates. Employers should make sure their payroll systems and tax calculations use the correct rules for each relevant period.

Key changes include:

• The personal deduction increases from VND 11 million to VND 15.5 million per month
• The dependent deduction increases from VND 4.4 million to VND 6.2 million per month
• The number of progressive tax brackets for resident individuals decreases from seven to five
• The highest personal income tax rate remains 35%, applying to taxable income above VND 100 million per month under the new schedule
• The law expands the categories of tax-exempt income, including additional provisions relating to science, technology, and certain high-value professional activities

The new PIT framework is supported by Decree 253/2026/ND-CP and Circular 87/2026/TT-BTC, both of which took effect on July 1, 2026.

Foreign Employees and Tax Residency

For foreign employees, tax residency remains an important factor in determining how personal income tax is calculated.

The residency rules continue to consider factors such as the individual’s number of days present in Vietnam and their habitual residence. Employers should assess each foreign employee’s tax residency based on the applicable statutory tests rather than using nationality or visa status alone.

For foreign employees who move into or out of Vietnam during the year, employers should review their tax residency and payroll treatment carefully, particularly when preparing annual tax finalisation.

Contribution Caps Rise With the New Base Salary

From July 1, 2026, the statutory base salary increases to VND 2,530,000 per month under Decree 161/2026/ND-CP.

Because the maximum salary used for certain social insurance contributions is capped at 20 times the statutory base salary, the resulting ceiling is VND 50,600,000 per month.

Employees whose applicable contribution salary exceeds this ceiling will have contributions calculated only up to the statutory maximum, rather than on their full salary.

Employers with highly paid employees should therefore review their payroll calculations after July 1, 2026 to confirm that the new ceiling has been applied correctly.

Electronic Labour Contracts Move Forward

Vietnam is also moving toward greater digitalisation of employment records.

Decree 337/2025/ND-CP provides the framework for electronic labour contracts, while Circular 08/2026/TT-BNV provides further guidance and took effect on July 1, 2026.

Electronic labour contracts can help employers reduce paperwork and improve record management, but employers using this system should make sure their process and technology comply with the applicable legal requirements.

For foreign companies managing employees in Vietnam remotely, this development may make employment documentation easier to manage, but it does not remove the employer’s responsibility to maintain compliant employment contracts and records.

Other Changes Worth Tracking

A few additional developments are worth monitoring as Vietnam continues to modernise its employment and immigration systems.

• Social insurance identification: From September 1, 2026, personal identification numbers are being used in place of social insurance numbers as part of the government’s broader effort to improve the management and connection of personal data.
• Foreign workers: Decree 219/2025/ND-CP continues to provide the main framework for foreign employees working in Vietnam. Employers hiring foreign specialists should monitor any further guidance or amendments affecting work permit exemptions and eligibility.
• Digital employment records: The introduction of electronic labour contracts and greater integration of government databases means employers should expect more employment information to be managed and cross-checked electronically.

These changes point in the same direction: employment compliance in Vietnam is becoming increasingly digital and data-driven.

What These Vietnam Labor Law Changes Mean for Employers

None of these Vietnam labor law changes should individually surprise a company that already runs compliant payroll. The bigger issue is the cumulative effect.

Employment contracts, payroll records, tax filings, and social insurance registrations increasingly need to match each other. As government systems become more connected, inconsistencies between these records may become easier to identify.

For foreign companies managing employees in Vietnam through informal contractor arrangements, outdated payroll systems, or incomplete employment documentation, the compliance risk is therefore increasing.

The practical response is not simply to update payroll. Employers should review the entire employment setup, including contracts, employee classification, salary calculations, tax treatment, social insurance, unemployment insurance, and employee records.

What Employers Should Check Now

Employers hiring or employing people in Vietnam should review the following:

• Payroll: Confirm that salaries meet the applicable 2026 regional minimum wage.
• Employment contracts: Check that contracts use the correct employee classification and terms.
• Social insurance: Review which employees, managers, and other workers are subject to mandatory social insurance.
• Unemployment insurance: Check employees who may now fall within the broader unemployment insurance regime.
• PIT: Update payroll systems for the new 2026 personal income tax rules and deductions.
• Contribution ceilings: Check employees whose salaries exceed the applicable social insurance contribution ceiling.
• Employee records: Confirm that personal identification information is accurate and consistent across relevant systems.
• Electronic contracts: If using electronic labour contracts, confirm that the system and signing process comply with the applicable requirements.

A periodic compliance review can help identify problems before they become payroll corrections, employee disputes, or issues during a government inspection.

Compliance Deadline Reminders

One important change has already taken effect: the transition from social insurance numbers to personal identification numbers began on September 1, 2026. Employers that have not completed the relevant update should address this as soon as possible.

Looking ahead, employers should also keep track of their regular tax and insurance filing deadlines. For Q4 2026, the standard deadlines include:

These dates reflect the standard filing and contribution schedule. Specific tax filing obligations may vary depending on the employer’s filing method and circumstances, so employers should confirm the applicable deadline for their own setup.

Key Legal Sources

The main legislation referred to in this update includes:

• Decree No. 293/2025/ND-CP on regional minimum wages, effective January 1, 2026.
• Social Insurance Law No. 41/2024/QH15, effective July 1, 2025.
• Employment Law No. 74/2025/QH15, effective January 1, 2026.
• Personal Income Tax Law No. 109/2025/QH15, effective July 1, 2026.
• Decree No. 161/2026/ND-CP on the statutory base salary, effective July 1, 2026.
• Decree No. 337/2025/ND-CP on electronic labour contracts.
• Circular No. 08/2026/TT-BNV providing guidance on electronic labour contracts, effective July 1, 2026.
• Decree No. 253/2026/ND-CP providing guidance on the new Personal Income Tax Law.
• Circular No. 87/2026/TT-BTC providing further guidance on personal income tax.

Talk to Forra About Your Vietnam Payroll and Compliance Setup

If you are not certain whether your payroll, employment contracts, tax filings, or social insurance registrations reflect the latest requirements, a compliance review can help identify potential issues before they become more costly to correct.

Forra provides Vietnam employment, payroll, EOR, and compliance support for foreign companies hiring and managing employees in Vietnam.

If you are reviewing your Vietnam employment setup, contact Forra to discuss your specific situation and the compliance steps you may need to take.