Question: My company currently has 22 employees under official labor contracts and participating in social insurance. However, we have not yet established internal labor regulations. What potential risks could the company face in this case?
Answer:
According to Article 119 of the 2019 Labor Code, any employer with 10 or more employees is required to issue and register internal labor regulations with the labor authority under the Provincial People’s Committee where the employer is registered.
Within 10 days from the date the regulations are issued, the employer must submit the registration dossier to the labor authority. The authority shall review the dossier within 7 working days from the date of receipt of a valid dossier. If any provisions of the regulations are found to be inconsistent with the law, the authority must notify and guide the employer to amend, supplement, and re-register the regulations.
If the employer has branches, units, or production and business establishments located in multiple localities, the registered internal labor regulations must also be sent to the labor authorities in each province where those units or establishments are located. Depending on specific circumstances, the provincial labor authority may authorize the district-level labor authority to handle the registration.
Pursuant to Clause 2, Article 19 of Decree No. 12/2022/NĐ-CP, employers who (i) do not have written internal labor regulations while employing 10 or more workers, or (ii) fail to register such regulations as required by law, shall be subject to the following penalties:
“A fine ranging from VND 5,000,000 to VND 10,000,000 shall be imposed on individuals, and from VND 10,000,000 to VND 20,000,000 on organizations.”
This penalty level is based on Clause 1, Article 6 of the same Decree, which specifies that fines for organizations are double those imposed on individuals.
Conclusion:
As your company employs 22 official employees who are covered by social insurance, it is legally required to issue and register written internal labor regulations.
Failure to do so may result in administrative fines ranging from VND 10,000,000 to VND 20,000,000 for the organization, as provided by law.
Moreover, without legally registered labor regulations, any disciplinary actions imposed by the company would lack legal validity, leaving the company without a lawful basis to handle employee violations. This could increase the risk of labor disputes and expose the company to adverse findings during labor inspections or HR audits.
Therefore, the company should promptly draft, issue, and register its internal labor regulations in compliance with current legal requirements to ensure full compliance and minimize legal risks.
Consultation reference: Company services
