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A Guide to Attaining Work Visas in Japan: Eligibility, Essentials and Key Insights

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A Guide to Attaining Work Visas in Japan: Eligibility, Essentials and Key Insights

blog- A Guide to Attaining Work Visas in Japan

Japan is an attractive destination for international talent, known for its advanced economy, cutting-edge industries, and unique cultural appeal. However, working in Japan as a foreign national is not possible without complying with the country’s strict immigration and labour regulations. A valid work permit and visa are required by law before engaging in any paid employment.

This guide provides a comprehensive overview of Japan’s work permit requirements, including visa categories, eligibility criteria, application processes, compliance obligations, and how employers can navigate these regulations efficiently.

Table Of Content

Why Japan Require Work Permits?

Japan’s approach to immigration is rooted in its economic priorities and demographic landscape. The requirement for work permits exists primarily to protect employment opportunities for Japanese citizens. By mandating foreign nationals to obtain specific work authorisations, the government ensures that only sectors facing genuine skill shortages open up to foreign expertise.

Moreover, Japan faces a significant demographic challenge—an ageing population coupled with a shrinking workforce. In response, the work permit system is pivotal in attracting skilled foreign workers in industries such as healthcare, IT, and engineering. This approach not only addresses labour shortages but also contributes to the country’s economic resilience and innovation efforts.

The permit system also serves as a mechanism to uphold labour standards. It ensures that foreign employees receive fair treatment, including equitable wages, safe working conditions, and access to social benefits, in line with Japanese labour laws. In doing so, it aims to prevent exploitation and maintain the workforce’s integrity.

Who requires a Work Permit or Visa to Work in Japan?

All foreign nationals who are not Japanese citizens or do not hold special residency status are required to obtain a work permit. The following individuals are exempt:

  • Japanese citizens (including those residing abroad)
  • Permanent residents
  • Long-term residents
  • Spouses or children of Japanese nationals or permanent residents

     

All other individuals must undergo a formal work visa application process supported by a Japanese sponsor (typically the employer).

What are the main types of work visas in Japan?

Japan offers a variety of long-term visa options depending on the nature of employment:

1. Work Visa

This is the most common type of employment across various sectors. The visa duration and conditions depend on the job category.

2. Specified Skills Visa (SSV1 and SSV2)

  • SSV1 is designed for foreign workers in sectors with significant labour shortages, such as nursing, agriculture, and shipbuilding. It is valid for up to five years.

     

  • SSV2 allows indefinite renewal and family accompaniment, granted to individuals with advanced expertise.

3. Highly Skilled Professional Visa

Issued to candidates with exceptional academic or professional backgrounds, offering a five-year residency and fast-track pathways to permanent residency.

4. Intra-Company Transferee Visa

Granted to employees being relocated from a foreign branch to the Japanese arm of their organisation.

5. Start-up Visa

Encourages entrepreneurial activity and innovation by allowing individuals to launch their business ventures in Japan.

6. General and Specified Visas

These include visas for cultural activities, internships, or research engagements.

What is the Certificate of Eligibility (CoE) and why is it required?

The Certificate of Eligibility (CoE) is a prerequisite document issued by Japan’s Immigration Services Agency. It confirms that the applicant meets the legal conditions for entry and residence based on employment, family ties, or other valid grounds.

The employer (or sponsor) must apply for the CoE on the applicant’s behalf. Once approved—usually within three months—the document must be presented during the visa application process at the relevant Japanese embassy or consulate abroad.

What are the Work Permit Requirements in Japan?

To obtain a work permit in Japan, the first prerequisite is a Certificate of Eligibility (COE). Employers typically apply for the COE on behalf of their hires through the regional immigration bureau.

General Requirements:

  • A valid passport

  • A formal job offer from a Japanese organisation

  • Completed visa application form

  • Recent passport-sized photograph (taken within the last six months)

Depending on the visa type, additional documents, such as skills assessment results or Japanese language proficiency scores, may be required.

How does the Work Visa Application Process Work in Japan?

The process to secure a work permit in Japan involves the following steps:

  1. Securing a Job Offer: The foreign applicant must first receive an offer of employment from a Japanese employer.

  2. COE Application by Employer: The employer submits a COE application to the local immigration office on the employee’s behalf. This process can take up to three months.

  3. Visa Application: Once the COE is granted (valid for three months), the employee must apply for a work visa at a Japanese consulate or embassy in their home country.

  4. Supporting Documents: These include:

  • Letter of Guarantee

  • Official Invitation Letter

  • Itinerary and purpose of visit

  • List of visa applicants (if applicable)

  • Company profile and contact information

For the Specified Skilled Worker visa, applicants must submit a skill evaluation scoring 70 points or more.

What are the Japan Work Visa Requirements for Employees and Employers?

A. Japan Work Visa Requirements for Employees:

  • A valid passport
  • A completed visa application form
  • Recent passport-sized photographs
  • Certificate of Eligibility (CoE)
  • Proof of job offer and employment contract
  • Relevant academic or professional credentials
  • A points-based assessment (for certain skilled categories).

B. Japan Work Visa Requirements for Employers:

  • Letter of guarantee
  • Official invitation letter
  • Business registration documents
  • Visa applicant list and job descriptions
  • Detailed itinerary for the employee’s stay in Japan

Employers must be diligent in preparing these documents and ensuring accuracy to avoid delays or rejections.

Read our guide : Minimum Wage Trends in 2025 : A Comprehensive Global Overview

What are the work permit fees in Japan?

Visa application fees depend on the type of entry and the applicant’s nationality. The current fee structure is

  • Single-entry visa: ¥3,000 (approx. USD 30)

  • Multiple-entry visa: ¥6,000 (approx. USD 60)

These fees are non-refundable and must be paid at the time of visa application.

Conclusion

Attaining a work visa in Japan requires thorough preparation, accurate documentation, and a solid understanding of immigration procedures. From the initial Certificate of Eligibility to selecting the correct visa type and ensuring employer compliance, each step demands careful attention to detail.

For employers, non-compliance can result in significant legal and financial consequences. For professionals, delays or errors in the visa process can disrupt relocation plans and employment timelines. That’s why engaging with a trusted partner who understands Japan’s regulatory environment is not just helpful—it’s essential.

At Galaxy Group, we simplify international hiring and workforce mobility. With deep expertise across Asia and a robust presence in Japan, we provide end-to-end support for work permits, compliance, and onboarding—so you can focus on growing your business or career without barriers.

Disclaimer: This blog is for informational purposes only and does not constitute any legal advice.

Secure Your Japan Work Visa Seamlessly

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FAQ’S

How long does it take to obtain a Japanese work visa?

The time taken to process a Japanese work visa typically ranges between 5 and 10 working days, though this may vary depending on the consulate or embassy where the application is submitted.

However, prior to the visa application, the Certificate of Eligibility (CoE) must be issued by the Immigration Services Agency in Japan—a process which can take up to three months to complete.

Yes. In April 2024, Japan introduced a Digital Nomad Visa for remote workers. Eligible individuals must earn at least ¥10 million (approx. USD 65,000) annually and may reside in Japan for up to six months. This visa is not renewable immediately and requires applicants to wait six months before reapplying.

It offers remote professionals a unique opportunity to live and work in Japan without engaging in local employment.

Upon arrival in Japan, immigration authorities will issue a Landing Permit at the port of entry. This permit effectively replaces the visa and serves as official authorisation to enter and begin residing in Japan.

No. All non-residents must hold a valid work visa. Working on a tourist visa is illegal and may result in fines, deportation, or a ban on re-entry.

If you enter the country via major airports such as Narita, Haneda, Kansai, or Chubu, you will typically be issued your Residence Card immediately upon arrival, alongside the Landing Permit.

However, those entering through other ports of entry must visit the municipal office in their local area to apply for a Residence Card.

Additionally, within 14 days of establishing your residence, you are required to register your address at the local ward or municipal office. Your address will then be printed on your Residence Card.

A Re-Entry Permit is necessary if you intend to leave Japan for a period exceeding one year. For shorter absences, a Special Re-Entry Permit can be obtained at the airport prior to departure, allowing re-entry within a one-year period without the need for additional documentation.

Yes. By using an Employer of Record (EOR) like Galaxy Group, your business can hire talent compliantly without needing to establish a legal entity.

Employer’s Guide to Drafting International Employment Contracts

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Employer’s Guide to Drafting International Employment Contracts

Employer’s Guide to Drafting International Employment Contracts

In an era where remote work and cross-border hiring are the norm rather than the exception, international employment contracts have become a cornerstone of global workforce management. These agreements ensure legal compliance across jurisdictions, define the employer–employee relationship, and provide a framework to address risks and responsibilities.

At Galaxy Group, we recognise the challenges of global hiring and offer strategic insights to simplify your journey. This guide is a practical reference for drafting compliant, effective employment contracts, particularly for businesses operating in or expanding to Singapore and beyond.

Table Of Content

What Is an International Employment Contract?

An international employment contract is a formal agreement between a company and an employee based in another country. Unlike local contracts, these must comply with the employment laws of the employee’s country of residence.

They serve as a mutual reference point for responsibilities, rights, compensation, and conduct, ensuring both parties are protected under applicable law.

Why Is an International Employment Contract Necessary?

Without a properly drafted contract, employers expose themselves to legal, financial, and reputational risk. These agreements are essential for the following reasons:

 

  • Compliance with foreign labour laws and statutory requirements
  • Protection of employer interests in areas such as confidentiality and IP
  • Clarity around duties, compensation, and performance expectations
  • Legitimacy of employment, especially for immigration or permit purposes

     

Countries with strong employee protection frameworks often require a written contract by law.

What Should Be Included in an International Employment Contract?

The strength of an international contract lies in its detail. A comprehensive contract should include the following fundamental elements:

 

1. Basic Information

  • Full name, residential address, and tax identification number of the employee
  • Registered name and address of the employer
  • Job title and department
  • Start date (and end date, if fixed-term)

     

2. Job Description and Responsibilities

Clear definition of the employee’s role, duties, and performance expectations. Ambiguity here can lead to disputes or claims of unfair dismissal.

 

3. Contract Type

Specify whether the role is:

  • Full-time or part-time
  • Fixed-term or indefinite

In some jurisdictions, fixed-term contracts automatically convert to indefinite after a certain period—something that must be addressed clearly.

 

4. Working Hours and Overtime Policy

Define the standard workweek, rest periods, and rules for overtime compensation. Refer to local laws—some countries enforce maximum weekly hours, mandatory rest, or time tracking requirements.

 

5. Compensation and Benefits

Outline all financial terms, including:

  • Base salary (currency should be clarified)
  • Bonus structures, allowances, and commissions
  • Statutory and company-provided benefits (healthcare, pension, 13th-month pay, etc.)
  • Payment schedule and applicable tax deductions

     

6. Leave Entitlements

List the types of leave the employee is entitled to, such as:

  • Annual paid leave
  • Sick leave
  • Parental or maternity leave
  • Public holidays

Include how leave is accrued and whether unused leave is carried forward or paid out.

 

7. Probationary Period

If applicable, define the duration of probation, its conditions, and whether termination or confirmation applies at the end. Some countries limit the length or legality of probation periods.

 

8. Termination Terms and Notice Period

Include:

  • Grounds for termination (e.g. performance, misconduct, redundancy)
  • Required notice periods for both parties
  • Local severance pay regulations
  • Restrictive termination conditions (e.g. protection during maternity or medical leave)

     

9. Intellectual Property Rights

Clearly outline ownership of work and innovations created during the course of employment. Employers must protect:

  • Trade secrets
  • Software, patents, and designs
  • Confidential strategies or client data

     

10. Confidentiality and Post-Employment Restrictions

Include enforceable clauses such as:

  • Non-disclosure agreements (NDAs)
  • Non-compete clauses
  • Non-solicitation of clients or employees

The validity of these clauses varies widely by jurisdiction, so legal review is essential.

Which Clauses Are Critical for Legal Protection?

Certain clauses carry greater legal weight in cross-border disputes. These include:

  • Governing Law and Jurisdiction – Which country’s law applies, and where disputes will be resolved.
  • Force Majeure – Addresses unforeseeable disruptions (natural disasters, war, etc.).
  • Data Protection – Specifies adherence to regulations like GDPR, if applicable.
  • Amendment Procedures – How and when the contract terms can be altered.

These provisions provide legal certainty, especially when different legal systems are involved.

Read our guide on: Employee Engagement in Difficult Times: 6 Key Strategies

How Does International Contract Law Affect Your Obligations?

While the term “international contract” implies a global standard, there is no universal employment law. Instead, employers must comply with:

  • National employment laws of the employee’s country

  • Regional or provincial laws (e.g. state-specific regulations in the U.S. or provinces in Canada)

  • International treaties (such as tax treaties to prevent double taxation)

Failing to consider these obligations may render the contract unenforceable or subject the employer to fines and litigation.

What Are the Common Mistakes to Avoid?

  1. Using a generic contract across all countries

  2. Omitting mandatory local benefits or notice periods

  3. Failing to update clauses when local labour laws change

  4. Confusing an offer letter with a legally binding contract

  5. Neglecting to consult legal experts or in-country advisors

Employers should also beware of fixed-term contract conversions and unintentional breaches of Collective Bargaining Agreements (CBAs), which may override individual contract terms.

Conclusion

In the global workplace, an international employment contract is not merely paperwork—it is your primary safeguard. It protects your business, empowers your workforce, and ensures compliance with complex, evolving legal frameworks.

At Galaxy Group, we support employers in crafting watertight, legally compliant employment contracts for international hires. Whether you’re hiring across Asia, Europe, or the Americas, our experts help you navigate the full lifecycle of international contract law—from drafting to execution and beyond.

Ready to hire confidently across borders? Contact Galaxy Group today and ensure your international employment contracts are built to last.

Disclaimer: This blog is for informational purposes only and does not constitute any legal advice.

Secure Your Global Hiring Today

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FAQ’S

What are international tax treaties, and why do they matter in employment contracts?

Tax treaties are bilateral agreements between countries designed to prevent employees and companies from being taxed twice on the same income. If you’re hiring an employee based abroad, it’s crucial to determine whether your country has a treaty with theirs. These treaties can offer tax credits or exemptions, which must be considered during contract drafting to ensure accurate net salary calculations and legal compliance.

Fixed-term contracts can be practical for short-term roles, but they come with risks if the employee remains in the position long-term. In some countries, such as the United Kingdom and Japan, continuous employment under fixed-term contracts can result in the employee automatically gaining permanent status. As laws differ globally, employers should understand the local regulations before opting for this arrangement.

CBAs are negotiated agreements between employers and employee unions, often setting higher standards than national labour laws, such as extended annual leave or additional benefits. For example, in France, CBAs are common and can override individual employment contract terms. If hiring in regions where CBAs are active, it’s wise to consult or collaborate with unions to ensure compliance and avoid complications.

Managing payroll for overseas employees can be complex. Issues may arise around local minimum wages, overtime pay, salary increments, and leave entitlements. Employers must refer to the employment laws applicable in the employee’s country and ensure these are reflected in the contract. Partnering with a global Employer of Record (EOR) can help streamline payroll while ensuring full compliance.

An offer letter usually outlines initial job details and intentions, but it is not always legally binding. In contrast, an employment contract is a formal legal document that details the full scope of the working relationship. In some countries, like those in Europe or Asia, an accepted offer letter may legally bind the employer—so it’s vital to ensure consistency between both documents and understand local implications.

Yes, but each version must be tailored to the specific legal framework of the employee’s country. There is no one-size-fits-all solution in international employment. Collaborating with legal professionals or global HR service providers is highly recommended to ensure each contract respects local laws and cultural practices.

Staying compliant starts with understanding local labour laws and updating contracts when regulations change. Employers can either build internal legal and HR teams or work with specialised partners such as Employer of Record service providers. These professionals manage compliance, draft contracts, and assist with international onboarding, saving time and reducing legal risk.

The Ultimate Employers’ Playbook for Hiring in the Philippines

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The Ultimate Employers' Playbook for Hiring in the Philippines

The Ultimate Employers' Playbook for Hiring in the Philippines

With its young, tech-savvy, and English-speaking workforce, the Philippines continues to stand out as a strategic destination for international companies expanding their global talent pool. The country boasts a labour force of over 40.5 million people—nearly 40% of its total population—making it one of the most dynamic and competitive hiring markets in Southeast Asia.

Filipino professionals are well-versed in Western culture and fluent in English, which significantly smoothens communication and cross-border collaboration. In recent years, there’s been a surge in skilled talent across fields like mobile app development, data analytics, digital marketing, and other emerging tech roles.

For companies unfamiliar with local regulations, partnering with a Philippines hiring agency or utilizing an employer of record Philippines service can simplify the onboarding process, ensuring full compliance with local employment laws and labor standards. Managing payroll Philippines can also be complex due to mandatory benefits and statutory deductions, making it critical to have expert guidance or reliable local partners.

However, before hiring in any new geography, it’s essential to understand the local employment laws, labour classifications, and statutory requirements. This playbook offers a clear roadmap to hiring in the Philippines in 2025, covering everything from worker types and payroll in the Philippines to compliance frameworks and termination guidelines—ensuring your expansion is not only strategic but also fully compliant.

Infographics- Hiring Filipino Talent_

Ready to Hire in the Philippines?

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An Employer’s Guide to Work Permits in Hong Kong in 2025

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An Employer's Guide to Work Permits in Hong Kong in 2025

An Employer's Guide to Work Permits in Hong Kong in 2025

Hong Kong presents a compelling proposition for companies seeking a strategic base in the Asia-Pacific region. As a leading global financial centre, it offers unparalleled access to half of the world’s population within a five-hour flight radius. Coupled with a low and straightforward tax regime, world-class infrastructure, and a highly skilled workforce, Hong Kong consistently ranks among the most business-friendly jurisdictions worldwide.

For organisations looking to address specialised talent requirements, the recruitment of non-local professionals is often essential. In such cases, a clear understanding of Hong Kong work permit system is critical to ensuring regulatory compliance and facilitating a smooth onboarding process.

This article offers a comprehensive overview of the work permit in Hong Kong, specifically tailored for employers engaged in international hiring.

Table Of Content

Who Requires A Work Permit In Hong Kong?

Foreign nationals who do not hold the right of abode or right to land in the Hong Kong Special Administrative Region (HKSAR) must obtain an employment visa prior to taking up any work or professional role. This excludes individuals holding a Hong Kong Permanent Identity Card, which confers the right to live and work without restriction.

Types Of Work Permits In Hong Kong

Work permits in Hong Kong fall under a number of schemes, which vary based on an individual’s nationality, qualifications, and purpose of stay. These are broadly classified as employer-sponsored or non-sponsored.

 

Employer-Sponsored Permits:

  • General Employment Policy (GEP)
  • Admission Scheme for Mainland Talents and Professionals (ASMTP)
  • Immigration Arrangements for Non-local Graduates (IANG)
  • Technology Talent Admission Scheme (TechTAS)
  • Training Visa
  • Working Holiday Scheme (subject to specific country agreements)
  • Supplementary Labour Scheme (SLS)

 

Non-Sponsored Schemes:

  • Quality Migrant Admission Scheme (QMAS)
  • Dependent Visas for accompanying family members
  • Post-study visas for eligible graduates

 

Please explore Galaxy Group detailed article on Work Permits in Thailand : What Employers Should Know?

What are the Key Considerations For International Hiring in Hong Kong

Before initiating an international hire, companies must ensure that the role justifiably requires a foreign professional. The Immigration Department places significant weight on the availability of local talent for the role in question.

 

Employers should:

  • Verify the alignment between the job description and the eligibility criteria of the relevant work permit scheme.
  • Understand the duration, renewal process, and dependencies associated with the visa.
  • Structure employment contracts appropriately and retain relevant proof of recruitment efforts.
  • Anticipate possible legal risks in the event of non-compliance or rejection.

 

Failing to approach these steps with due care can result in business disruptions and reputational damage.

General Guidelines For Work Permits in Hong Kong

Work permits in Hong Kong are granted based on an assessment of both employer and candidate credibility, as well as economic need.

 

Key points include:

  • Labour Market Testing: The role must be demonstrably difficult to fill locally.

     

  • Processing Time: Typically 4–6 weeks, though delays are common during peak periods (June–August).

     

  • Discretionary Decisions: Approval lies entirely at the discretion of the Immigration Department.

     

  • Eligibility Requirements: Applicants must have valid travel documents, no criminal record, and sufficient means of support.

     

  • Document Requirements: A signed employment contract and genuine job offer are essential.

     

  • Credibility Standards: Both applicant and employer must have a legitimate professional background.

     

  • Visa Duration: Permits are usually issued for one to two years and may be renewed.

     

  • Dependent Applications: Spouses and children can apply for dependent visas under most schemes.

     

  • Permanent Residency: After seven years of continuous legal stay, individuals may apply for permanent resident status.

     

  • Change of Employment: A new visa application is required if the individual changes employers.

What is the Application Process For Schemes Requiring Employer Sponsorship?

Step 1: Completion of Forms

Both the candidate and employer must complete the appropriate application forms. For example, under the GEP scheme, Form ID 990A (applicant) and ID 990B (employer) must be submitted.

 

Step 2: Collation of Documents

  • Candidate’s documents: Passport copy, academic qualifications, recent photo, proof of prior employment, etc.
  • Employer’s documents: Business registration certificate, employment contract, company financials, organisational structure, and operational plan.

 

Step 3: Online Submission

Applications are submitted electronically via Hong Kong’s government portal:
Online Application for Entry for Employment as Professionals in Hong Kong

 

Step 4: Review and Assessment

The Immigration Department reviews each case individually, assessing the employer’s business viability and the candidate’s suitability for the role.

 

Step 5: Visa Issuance

Upon successful review, an electronic visa (e-visa) is issued. This must be presented at immigration upon arrival in Hong Kong.

What are the Common Challenges Faced by Employers during the Visa Process?

Employers may encounter several obstacles during the visa process in Hong Kong:

  • Incomplete Applications: Missing or inaccurate documents frequently cause delays.

     

  • Lack of Supporting Evidence: Insufficient justification for hiring a foreign professional may lead to rejection.

 

  • Policy Volatility: Changes to immigration policy or eligibility criteria can impact ongoing or planned applications

How to Mitigate the Challenges Faced by Employers During the Visa Process?

To minimise delays and improve success rates, employers should:

  • Review all documents meticulously before submission.
  • Provide a comprehensive job description and evidence of local recruitment efforts.
  • Stay updated on policy changes through government notices or legal advisers

 

Consider EOR solutions in Hong Kong

Partnering with a professional Employer of Record Hong Kong, such as Galaxy Group, can be highly beneficial. EORs support businesses by:

  • Managing the end-to-end work permit application process
  • Ensuring full compliance with Hong Kong’s labour laws
  • Overseeing payroll and employee benefits
  • Supporting seamless onboarding without requiring a local entity

This allows businesses to focus on strategic priorities while ensuring smooth international hiring.

Conclusion

Recruiting international professionals in Hong Kong is an opportunity that must be approached with diligence. By understanding the visa framework, structuring thorough applications, and working with experienced partners like Galaxy Group, employers can confidently manage foreign talent acquisition.

With the right support, international hiring becomes not only possible but a competitive advantage in one of Asia’s most dynamic markets.

Simplify Work Permits with Expert Support

Choose Hong Kong work permits with our EOR service. From applications to compliance, we handle it all—letting you focus on business growth.

Contact us now!

FAQ’S

What is a Work Permit in Hong Kong?

A work permit is an official authorization granted by the Hong Kong government to a foreign national allowing him / her to legally work in Hong Kong under specific employment terms.

Any person other than permanent residents who have the right of abode or right to land in the Hong Kong Special Administrative Region (HKSAR), must obtain a visa before coming to Hong Kong for the purposes of study, employment, training, investment, or residence.

There are various work permits the Hong Kong government allows for. The most common among them include the General Employment Policy (GEP), the Admission Scheme for Mainland Talents And Professionals (ASMTP) and the Technology Talent Admission Scheme (TechTAS)

The Employers are required to furnish documents like a detailed job description, proof of recruitment efforts made to employ local residents, business registration certificate, etc.

Applications typically take 4-6 weeks to process after all required documents are received, however the same varies from case to case. A longer processing time may be required during the summer rush period between June and August.  

Vietnam’s Manpower Laws: Key Insights for New Employers

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Vietnam’s Manpower Laws: Key Insights for New Employers

Vietnam’s Manpower Laws: Key Insights for New Employers

Vietnam has steadily emerged as one of Southeast Asia’s most promising markets for foreign investment. With over 70% of its population under 35, the country has a young, skilled, tech-savvy, and growing English-proficient workforce, making it highly attractive for global businesses.

 

Encompassing one of the lowest labour costs in the region, including the minimum wage in Vietnam, it’s no surprise that companies across industries are setting their sights on this dynamic economy. However, entering a new market, such as through business incorporation in Vietnam, comes with it’s share of responsibilities, and in Vietnam, that begins with understanding how local labour laws operate.

 

Whether setting up a new business in Vietnam or hiring through an Employer of Record (EOR) in Vietnam, being familiar with key employment regulations is essential. This blog outlines key insights from core labour-related laws that Employers must understand to navigate Vietnam’s legal landscape.

Table Of Content

Regulatory Framework in Respect of Manpower Laws in Vietnam

Vietnam’s Manpower landscape is shaped by multiple legal instruments that collectively define the rules of engagement between employers and employees, covering everything from recruitment to benefits, insurance, safety, and termination. These include:

  • The Labour Code (2019) – the principal statute that governs all individual and collective employment relationships in Vietnam.

  • The Employment Law (2013) – sets a broader framework for labour market development and vocational training.

  • The Social Insurance Law (2014) – mandates the participation of employers and employees in Vietnam’s compulsory social insurance (SI) system.

  • The Occupational Safety and Health Law (2015) – designed to safeguard workers’ physical and mental health across all sectors.

What are the Key The insights of Manpower Laws in Vietnam?

1. Employment Contracts

Ø  The Labour Code recognises two types of contracts:

  • Indefinite-Term Contracts – This type of contract is best suited for permanent roles, as it has no fixed term or termination date. The contract becomes indefinite after two consecutive fixed terms.
  • Fixed-Term Contracts – This type of contract is ideal for project-based or temporary work, allowing for a fixed term of up to 36 months. It can only be renewed once, after which it becomes indefinite if parties continue working after expiration.

Ø  Probationary Periods – Must be agreed to in writing and cannot exceed 30 days for jobs requiring vocational training and 60 days for jobs requiring college degrees or higher.

 

Ø  Unilateral termination – Either party may terminate the contract under specific conditions, with a 30 to 45 day notice period based on the type of contract. Failure to follow proper dismissal procedures can result in legal and financial penalties.

2. Working Hours, Overtime, and Leave

Ø  Standard working hours in Vietnam are up to 10 hours per day and 48 hours per week, where a weekly basis is applied. However, a 40-hour workweek is encouraged by the government.

Ø  Overtime is allowed provided that:

–         Employee’s overtime working hours do not exceed 50% of the regular working hours in a day.

–         In the case of weekly work, the regular working hours plus overtime do not exceed

  •         12 hours/day
  •         40 hours/month
  •         200 hours/year, extendable to 300 hours in specific sectors

Ø  Employees are entitled to at least 12 days of annual leave, plus public holidays and special leave for personal reasons. Pro-rata leave applies to employees with less than 12 months of service.

Ø  The Act also provides for an increase of 1 day annual leave with every 5 years of employment with the same employer.

3. Social Insurance

Under the Social Insurance Law 2014, all employers are required to contribute to the following for all employees with contracts of at least one month:

  • Social Insurance (SI): SI covers sickness, maternity, occupational accidents, retirement, and death.
  • Health Insurance (HI): HI provides coverage for medical examination, treatment, and hospitalisation costs, ensuring employees have access to essential healthcare services.
  • Unemployment Insurance (UI): UI offers income replacement during unemployment.

These contributions support retirement, maternity, sickness, unemployment, and medical coverage. They apply to all employees with contracts of one month or more.

4. Safe Workplaces

Employers are legally responsible for ensuring a safe and healthy working environment under the Occupational Safety and Health Law 2015. This includes:

  • Risk Prevention: Employers must conduct risk assessments, establish safety protocols, and regularly inspect workplace hazards.
  • Training: Mandatory safety and hygiene training must be provided, particularly for roles involving hazardous materials or equipment.
  • Medical Surveillance: Annual health checks are required, with increased frequency for high-risk occupations.
  • Accident Reporting and Compensation: Serious workplace injuries must be reported to labour authorities within 24 hours. Employees who are injured on the job are entitled to treatment and financial compensation, which is based on the severity and cause of the injury. Employers who hire employees in Vietnam should be aware of these obligations to ensure compliance with local labour laws.

Promoting a culture of safety is not only a legal mandate but also a vital component of employee retention and brand reputation.

5. Hiring Foreign Employees

Vietnam allows hiring foreign professionals, but only for roles where local expertise is unavailable. Employers, often with the help of recruitment services in Vietnam, must justify the hire and obtain a work permit before the employee begins work.

Commonly approved positions include

  • Managers and executives
  • Technical experts
  • Project consultants

6. Legal Protections for Vulnerable Workers

Vietnam’s labour system includes targeted protections for women and vulnerable workers:

  • Female employees with children under 12 months get a 60 minute daily break for nursing
  • Women are also entitled to menstrual leave – minimum 3 days/month with a 30 minute daily break
  • Anti-discrimination provisions mandate equal opportunities and prohibit bias in recruitment processes.

Employer Tips for Compliance

  •  Update internal policies to reflect gender protections and anti-discrimination rules.
  • Use bilingual contracts that specify the governing language and always align contract terms with statutory requirements.
  • Keep detailed records of working hours and leave to stay audit-ready and prevent disputes.
  • Ensure monthly payments are submitted on a timely basis. Non-compliance can lead to significant back-pay demands and legal consequences.
  • Safety procedures are mandatory. Implement a compliance-first culture to protect both your workforce and your reputation.
  • Partner with a licensed EOR or legal provider to handle permit applications and ensure proper onboarding.  

Why Compliance Matters More Than Ever?

Labour laws in Vietnam are actively being aligned with global standards, thanks in part to trade agreements and international economic integration. Compliance is more than just a box to tick for foreign businesses – it’s a foundation for sustainable growth.

Poor labour practices can result in penalties, reputational harm, and even the suspension of a business license. On the other hand, a compliant employer is viewed as trustworthy, ethical, and future-ready.

 

Read our expert guide on : Minimum Wage Trends in 2025

How Can the Galaxy Group Help?

At Galaxy Group, we specialise in making international hiring simple, compliant, and seamless. As a trusted Employer of Record (EOR) and corporate solution provider, we help you:

  • Draft legally sound employment contracts
  • Manage payroll in Vietnam and social insurance contributions
  • Navigate complex hiring procedures for foreign workers
  • Maintain a compliant and safe work environment

Whether you’re hiring one employee or building a whole team in Vietnam, Galaxy Group offers the local expertise and operational support to help you scale confidently.

Final Thoughts

Vietnam is a compelling destination for global business – but success starts with respecting the rules. By understanding the country’s labour laws and proactively managing compliance, you protect your employees, your business, and your long-term investment.

 

And with Galaxy Group by your side, you’ll always be one step ahead.

 

 

Disclaimer: This blog is for informational purposes only and does not constitute any legal advice.

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FAQ’S

Can foreign workers be employed in Vietnam?

Yes, foreign workers can be employed in Vietnam by obtaining a work permit from the relevant authorities, and only for positions that cannot be filled by Vietnamese nationals. Common eligible roles include managers and executives, technical experts, and consultants.

Employers must conduct risk assessments, implement safety protocols, provide mandatory training on occupational health and safety, and offer annual medical check-ups. They must report serious workplace accidents within 24 hours to the authorities and provide compensation if applicable.

Employers must contribute to Social Insurance, Health Insurance, and Unemployment Insurance for employees with contracts of at least one month.
These cover benefits such as maternity, sickness, accidents, retirement, and job loss.

Employment contracts must be in writing, clearly stating job roles, salaries, working hours, benefits, and termination conditions. Bilingual contracts (English and Vietnamese) are highly recommended for foreign employers.

Effective Taxation & Tax Planning Strategies for Businesses in Hong Kong

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Effective Taxation & Tax Planning Strategies for Businesses in Hong Kong

Effective Taxation & Tax Planning Strategies for Businesses in Hong Kong

Tax planning is crucial for businesses in Hong Kong looking to maintain profitability while staying compliant with local tax laws. Hong Kong’s attractive tax system, known for its simplicity and low rates, still requires businesses to adopt a strategic approach with the planning of taxes. By understanding the nuances of corporate tax, offshore income, and the various available incentives, companies can minimsze liabilities and optimise their financial performance.

Table Of Content

  • Understanding Hong Kong’s Territorial Tax System
  • What is a Territorial Tax System?
  • Key Features of Hong Kong’s Territorial Tax System
  • Advantages of Hong Kong’s Territorial Tax System
  • Challenges and Considerations
  • Conclusion

Understanding Hong Kong’s Territorial Tax System

Hong Kong is renowned for its business-friendly environment, and one of the key factors contributing to its appeal is its territorial tax system. This unique framework plays a crucial role in making Hong Kong a global financial hub, particularly for businesses and individuals looking to minimise their tax exposure and liabilities. In this blog post, we’ll break down what Hong Kong’s territorial tax system entails, how it differs from other tax regimes, and what advantages and challenges it presents for companies and individuals.

What is a Territorial Tax System?

A territorial tax system is a framework where taxes are levied only on income earned within a country’s borders. In the case of Hong Kong, this means that only income derived from activities carried out within Hong Kong is subject to tax. Any income generated from sources outside of Hong Kong is tax exempted, regardless of whether it is remitted into the territory or not. This is distinct from a worldwide tax system, like those of the U.S. or some European countries, where residents are taxed on their global income, regardless of where it was earned.

Key Features of Hong Kong’s Territorial Tax System

No Tax on Foreign Income: Hong Kong’s system means that any income you generate outside of the city is not taxed. Whether you’re a corporation with operations abroad or an individual earning foreign income, this income remains untaxed unless it’s derived directly from activities rendered in Hong Kong.

A Simple Tax Structure : Hong Kong’s tax system is relatively simple, with no sales tax, no capital gains tax, no withholding tax on dividends or interest and no estate tax. The focus is primarily on profits tax, salaries tax and property tax, which are all governed by territorial principles.

Profits Tax: Companies are taxed at a flat rate of 16.5% on profits derived in/from Hong Kong. Small businesses, however, enjoy a reduced rate of 8.25% on their first HKD 2 million of taxable profits. This low corporate tax rate, combined with the territorial principle, deems Hong Kong a favorable location for multinational companies to invest in.

Salaries Tax: Individuals are taxed at progressive rates on their income in Hong Kong. The standard rate for salaries tax is 15%, and tax is applied only to income sourced within the country.

Source of Income Determination: Determining whether income is sourced from within Hong Kong can sometimes be complex. The Inland Revenue Department (IRD) uses several principles, including where the income-producing activities took place, to determine whether the income is taxable. If the income arises from services rendered or business activities carried out in Hong Kong, it will generally be taxable.

Advantages of Hong Kong’s Territorial Tax System

Attracts Global Businesses: Hong Kong’s exemption on foreign income is highly attractive to enterprises. Companies can establish their headquarters or regional offices in Hong Kong and not be subject to taxation on their foreign profits – an advantageous offering.

Encourages Foreign Investment: The system encourages businesses and investors to bring their capital into Hong Kong without fear of incurring additional taxes on income earned elsewhere. This policy has contributed to Hong Kong’s status as a major global financial center.

Efficient and Transparent: Hong Kong’s tax laws are clear, and the process of paying taxes is straightforward. Businesses can benefit from the predictability and transparency of the system, which reduces administrative burden and allows companies to focus on growth.

Challenges and Considerations

Complexity in Determining Source of Income: While the concept of territorial taxation is simple, determining whether income is derived from Hong Kong or abroad can be tricky. Businesses may face challenges in proving that their income was generated from foreign sources, especially in cases where services or products have local and international work elements.

Potential Scrutiny from Other Jurisdictions: Some countries, particularly those with global taxation systems, may scrutinise companies that take advantage of Hong Kong’s tax regime. As tax regulations become more complex globally, businesses may need to ensure compliance with both local and foreign tax laws to avoid penalties.

Conclusion

Hong Kong’s territorial tax system is a major advantage for businesses and individuals seeking tax efficiency. By focusing taxation solely on income earned within its borders, Hong Kong offers a straightforward and favourable tax environment that encourages international trade and investment. However, while the system is advantageous, companies and individuals must navigate the complexities of determining where income is sourced to ensure compliance. As the global tax landscape continues to evolve, businesses must stay informed about both local and international tax obligations. Nevertheless, Hong Kong remains a prime destination for those seeking a business-friendly tax regime, offering significant opportunities for growth and investment.