Labor Dispute Adjudication Trends 2025-2026
Legal Context
The 2019 Labor Code (effective January 1, 2021) established a new legal framework for labor relations in Vietnam, with significant changes regarding employee rights, unilateral termination of labor contracts, and labor dispute resolution. After over four years of implementation, adjudication practice has formed notable trends that practitioners must understand.
Key Adjudication Trends
1. Disputes over Unilateral Termination of Labor Contracts
a) Unlawful Dismissal
This remains the most common type of labor dispute. Under Article 39 of the 2019 Labor Code, employers may unilaterally terminate labor contracts in legally prescribed cases but must strictly comply with procedural requirements.
Notable adjudication trends:
- Courts increasingly strict on procedural violations: Numerous judgments at HCMC and Hanoi People's Courts during 2024-2025 declared dismissals unlawful solely because employers failed to follow proper disciplinary procedures under Article 122 of the 2019 Labor Code, even when substantive grounds existed.
- High burden of proof on employers: Under Article 91 of the 2015 Civil Procedure Code, in labor cases, the burden of proof falls on the employer. Courts have applied this principle very strictly.
b) Employee's Right to Unilateral Termination
Article 35 of the 2019 Labor Code allows employees to unilaterally terminate labor contracts without reason, requiring only proper advance notice. This represents a major change from the 2012 Labor Code and has significantly reduced related disputes.
However, a new trend involves disputes over employees failing to provide sufficient notice and compensation obligations under Article 40 of the 2019 Labor Code.
2. Wage and Benefits Disputes
a) Overtime Pay Calculation Disputes
Under Article 98 of the 2019 Labor Code, overtime wages must be calculated based on unit wage rates or actual wages paid. Adjudication practice reveals that many enterprises calculate overtime on base salary (lower than actual compensation), which courts have declared unlawful.
Notable case: Judgment No. 08/2024/LĐ-PT of the High Court in HCMC established that overtime pay must be calculated on total actual income, including allowances of a wage nature.
b) Bonus and Benefits Disputes
The 2025-2026 trend shows increasing disputes over year-end bonuses, stock options, and other welfare benefits. Courts typically examine internal labor regulations, collective bargaining agreements, and enterprise practices to determine employee entitlements.
3. Social Insurance Disputes
Following the passage of the 2024 Social Insurance Law, social insurance-related disputes are trending upward:
- Retroactive social insurance contributions: Employees suing employers for unpaid or underpaid social insurance contributions. Courts generally accept these claims.
- Social insurance benefit entitlements: Disputes over unemployment insurance and occupational accident insurance rights when employers failed to make full contributions.
- Lump-sum social insurance withdrawal: The new provisions under the 2024 Social Insurance Law regarding one-time withdrawal are generating numerous disputes, particularly concerning eligibility conditions and withdrawal methods.
4. Labor Disputes in the Context of New Technology
a) Remote Work
The COVID-19 pandemic transformed work models, leading to novel disputes:
- Right to request remote work arrangements
- Monitoring remote workers
- Occupational accidents while working from home
- Remote work expenses (electricity, internet)
b) Gig Economy
Disputes between workers and technology platforms (Grab, Gojek, Shopee Food) regarding the nature of employment relationships are increasing. Courts must determine whether these constitute employment relationships or service contracts based on criteria in Article 13 of the 2019 Labor Code.
5. Collective Labor Disputes
The 2019 Labor Code expanded the rights of grassroots employee representative organizations (Articles 170-178), including organizations outside the Vietnam General Confederation of Labor system. This is creating new trends in collective labor disputes.
Analysis of Typical Judgments
Case 1: Dismissal for Internal Regulation Violations
Judgment No. 15/2025/LĐ-ST, District 1 People's Court, HCMC: Employee dismissed for violating confidentiality provisions. The court declared the dismissal lawful because: - Internal labor regulations were properly registered under Article 119 of the 2019 Labor Code - The violation was clearly stipulated as grounds for dismissal in the regulations - Disciplinary procedures complied with Article 122 of the 2019 Labor Code
Case 2: Social Insurance Benefits Claim
Judgment No. 22/2025/LĐ-PT, High Court in Hanoi: Employee sued employer for damages resulting from failure to pay social insurance contributions, leading to ineligibility for pension. The appellate court ordered the employer to compensate all damages, including the pension differential.
Recommendations for Practitioners
Representing Employees
- Leverage the principle that the burden of proof falls on the employer (Article 91, 2015 Civil Procedure Code)
- Carefully examine disciplinary procedures—procedural violations are the most common ground for courts to declare dismissals unlawful
- Claim full compensation under Article 41 of the 2019 Labor Code for unlawful dismissal
Representing Employers
- Develop detailed internal labor regulations and ensure proper registration
- Maintain comprehensive records of disciplinary proceedings
- Preventive counsel: establish termination procedures that comply with legal requirements
Conclusion
Labor dispute adjudication trends for 2025-2026 demonstrate that courts are increasingly providing more comprehensive protection for employee rights while requiring strict procedural compliance from employers. Practitioners must continuously update their knowledge of new judgments and adjudication trends to effectively advise and protect client interests.
