Hello, our company is currently employing a foreign worker. At present, the labor contract signed between the parties has expired and the employee is preparing to return to their home country. However, their Work Permit and Temporary Residence Card (TRC) are still valid for quite a long period. In this situation, what procedures is our company required to carry out in accordance with the law?
Answer
Pursuant to Clause 1, Article 34 of the 2019 Labor Code on cases of termination of labor contracts:
“1. The labor contract expires, except for the case prescribed in Clause 4, Article 177 of this Code.”
Accordingly, based on Clause 2, Article 156 of the 2019 Labor Code regarding cases in which a work permit becomes invalid:
“2. Termination of the labor contract.”
From the above provisions, it can be affirmed that when the labor contract between the Company and the foreign employee terminates, this simultaneously constitutes a legal basis for the employee’s work permit to become invalid, regardless of the remaining validity period stated on the permit. This creates an obligation for the enterprise to carry out the procedure for revoking and returning the work permit in accordance with the law.
1.Obligations of the enterprise upon terminating the labor contract with a foreign employee
a, For the Work permit
Pursuant to Clause 1, Article 30 of Decree 219/2025/NĐ-CP, which provides for cases in which a work permit is revoked:
“1. The work permit expires as prescribed in Clauses 2, 3, 4, 5, 6, and 7 of Article 156 of the Labor Code.”
Accordingly, Clause 1, Article 31 of Decree 219/2025/NĐ-CP provides the procedure for revoking a work permit:
“1. In the case prescribed in Clause 1 of Article 30 hereof, within 15 days from the date the work permit expires, the employer shall revoke it and submit it to the competent authority that issued such permit, together with a written report on the revocation. If the work permit cannot be revoked, the employer must clearly state the reason.”
Based on the above provisions, when the foreign employee and the company terminate the labor contract—an event that directly renders the work permit invalid—the work permit must be revoked. Therefore, within 15 days from the date of termination of the labor contract, the company is responsible for retrieving and returning the work permit to the competent authority, along with a full report; if the permit cannot be retrieved, the company must clearly state the reason in accordance with the regulations.
b, For the Temporary Residence Card (“TRC”)
Pursuant to Point e, Clause 2, Article 45 of the Law on Entry, Exit, Transit, and Residence of Foreigners in Vietnam 2014, as amended in 2019 and 2023, it is stipulated that:
“e) Notify immigration authorities in writing of the cases in which foreigners granted entry/exit/residence permits no longer wish to be sponsored during their temporary residence period in Vietnam, and cooperate with competent authorities in requesting such foreigners to leave Vietnam.”
Accordingly, based on Article 6 of the same Law, which provides regulations on the revocation and cancellation of documents valid for entry, exit, and residence issued by Vietnamese authorities: “Revocation, invalidation of entry/exit/residence permits issued by Vietnamese competent authorities
Any foreigner that violations regulations of Clauses 3 through 6 Clause 5, Clause 3 Article 21, Point b Clause 2 Article 44 of this Law shall have his/her entry/exit/residence permit permit revoked.”
In addition, pursuant to Point b, Clause 2, Article 44 of the Law on Entry, Exit, Transit, and Residence of Foreigners in Vietnam 2014, as amended in 2019 and 2023, which provides for the rights and obligations of foreigners as follows:
“2. Foreigners that enter, leave, transit through, or reside in Vietnam are obliged to:
...
b) Engaged in activities in Vietnam in accordance with the stated purpose of entry;”
Accordingly, when a foreign employee terminates the labor contract with the company, the purpose of residence under the “work” category no longer exists. Continuing to reside in Vietnam under a still-valid TRC while no longer complying with the intended purpose of entry constitutes conduct that may lead to revocation of the TRC by the immigration authority pursuant to Article 6 mentioned above.
Therefore, for a still-valid TRC, the company is responsible for notifying the immigration authority in writing that it no longer wishes to sponsor the foreigner, and for coordinating with the competent authorities to carry out the procedure for revoking the TRC, as well as requesting the foreign employee to exit Vietnam in accordance with the law.
2.What are the consequences if the enterprise fails to follow the required procedures?
Pursuant to Point a, Clause 6, Article 18 of Decree 144/2021/NĐ-CP, it is stipulated: “6. A fine of from VND 15.000.000 to VND 20.000.000 shall be imposed for any of the following violations:
(a) Following procedures for inviting or sponsoring a foreigner for entry, exit or residence in Vietnam without fulfilling responsibilities as prescribed by law, or providing false information when following such procedures.;”
Accordingly, pursuant to Clause 2, Article 4 of Decree 144/2021/NĐ-CP, which provides the maximum fine levels applicable to administrative violations:
“2. The fines specified in Chapter II of this Decree are imposed upon administrative violations committed by individuals. The fine imposed upon an organization for the same violation shall be twice the fine imposed upon an individual.”
Therefore, in cases where a company sponsors a foreign employee to enter and reside in Vietnam for employment purposes, but when the employee terminates the labor contract and no longer works in Vietnam, the company fails to fulfill its obligations to notify the authorities of the termination of sponsorship, and fails to retrieve and return the temporary residence card to the immigration authorities, the company may be subject to penalties under Point a, Clause 6, Article 18 mentioned above. For organizations, the applicable fine ranges from VND 30,000,000 to VND 40,000,000 (double the fine applicable to individuals).
Consultation: Labor and Employment Services
