DECREES:

Chapter I

EMPLOYMENT PROGRAM

Article 1.- The employment program as provided for in Item 1, Article 15, of the Labor Code comprises: The objectives, targets of new employment, policies, resources, organizational system and measures to ensure the realization of the program.

The designing of the program must be assured of the systematic character and must match the objectives with the conditions for their realization.

1. The target of new employment as stipulated in Article 14 of the Labor Code is the new labor force that needs to be recruited to add to the permanent labor force employed by organizations, units and individuals of all economic sectors, arising from the needs created by a new establishment or expansion of production scale and activities or by labor rearrangement.

2. In the annual and five-year plans for socio-economic development of all levels and branches, the program-objective sections must include new employment targets.

Article 3.- The Ministry of Labor, War Invalids and Social Affairs shall study the plan for designing and implementing the national employment program and submit it to the Prime Minister for approval.

Article 4.- The State Planning Committee shall preside over and consult the Ministry of Labor, War Invalids and Social Affairs and the concerned Ministries and branches to design the targets for new employment in the annual and five-year plans and submit them to the Government for approval.

The Ministry of Labor, War Invalids and Social Affairs is responsible for providing guidance and inspection and shall report to the Government the result of the realization of the annual and five-year targets of new employment.

1. Annually, the Ministry of Labor, War Invalids and Social Affairs shall preside over and consult the State Planning Committee, the Ministry of Finance and the other concerned Ministries and branches to plan the implementation of the national employment program and the national fund for employment so that the Government may submit it to the National Assembly for approval at the year-end session of the National Assembly.

2. The Ministry of Labor, War Invalids and Social Affairs is responsible for organizing and inspecting the implementation of the national employment program and shall report the result to the Government.

1. The national fund for employment as stipulated in Item 1, Article 15, of the Labor Code, is formed from the following sources:

a) Allocations from the annual State budget;

b) Sources outside the State budget, which include: assistance from foreign countries, international organizations and foreign individuals; from domestic units and individuals that are willing to assist the employment problem.

2. The national fund for employment is used for the following purposes:

a) To assist job-placement organizations;

b) To assist units which are meeting temporary difficulties with a view to helping a good number of employees to keep their jobs;

c) To assist units which take on unemployed laborers at the proposal of the local office of Labor, War Invalids and Social Affairs;

d) To provide soft loans to assist the employment of a number of people who are beneficiaries of social welfare policies as provided for by the Ministry of Labor, War Invalids and Social Affairs;

e) To assist the fund for employment of disabled people.

3. The Ministry of Finance shall preside over and consult the Ministry of Labor, War Invalids and Social Affairs and the State Planning Committee to design and issue the regulation on management of the national fund for employment, and guide the localities in designing and implementing the regulations on management of their own funds for employment.

4. The Ministry of Labor, War Invalids and Social Affairs shall organize the implementation of the regulation on management of the national fund for employment.

1. Annually, the People's Committees of the provinces and cities directly under the Central Government shall design the programs and funds for employment of the localities, submit them to the People's Councils of the same level for decision, and organize their implementation; and at the same time report the results to the Ministry of Labor, War Invalids and Social Affairs, the State Planning Committee and the Ministry of Finance.

2. The People's Committees of the provinces and cities directly under the Central Government shall set the guideline, support and inspect the employment programs of district and commune levels.

3. The funds for employment of the provinces and cities directly under the Central Government are formed from the following sources:

a) Allocations from the local budget to be decided by the People's Councils of the provinces and cities directly under the Central Government;

b) Allowance from the national fund for employment;

c) Other sources.

4. The funds for employment of the provinces and cities directly under the Central Government must be used strictly for the purposes of the employment programs of the provinces and cities and in support of the employment programs of the districts. The Presidents of the People's Committees of the provinces and cities directly under the Central Government shall direct the provincial services of Labor, War Invalids and Social Affairs, Planning, Finance and other organizations to carry out their local employment programs and manage their local funds for employment.

Article 8.- The job placement organizations operating under Item 1, Article 18, and Article 156 of the Labor Code are uniformly referred to as "Job Placement Center" put beside the name of the locality or organization.

Article 9.- The job placement center is an income-generating non-business social welfare service established by the State or people's organizations or associations.

1. The job placement center has the tasks:

a) To provide consultation for laborers and employers on labor policies and employment; vocational orientation and job training;

b) To introduce laborers to work in places where labor is needed and to learn trade in appropriate places;

c) To supply labor for employers who are Vietnamese and foreigners operating legally in Vietnam;

d) To provide information on the labor market for laborers and employers who are Vietnamese and foreigners operating legally in Vietnam; and for the State management agencies in charge of labor and employment as stipulated by the Ministry of Labor, War Invalids and Social Affairs.

2. The job placement center has the rights:

a) To organize vocational training in combination with job generation;

b) To organize production to make full use of the technical and material basis, combine theoretical training with practice, and provide on-the-spot employment in accordance with the provisions of law;

c) To collect fees, tuition and other charges as provided for by the Ministry of Finance and the Ministry of Labor, War Invalids and Social Affairs, and in accordance with the detailed guidance of the People's Committees of the provinces and cities directly under the Central Government.

1. The establishment of the job placement centers in the provinces and cities directly under the Central Government is decided by the Presidents of the provincial and municipal People's Committees at the proposal of the Labor, War Invalids and Social Affairs Service and with the consent of the Ministry of Labor, War Invalids and Social Affairs.

2. The establishment and dissolution of the job placement centers of the people's organizations and associations are decided by the Heads of their organizations at the central level with the consent of the Ministry of Labor, War Invalids and Social Affairs.

3. The establishment of the specific job placement centers at a number of ministries is decided by the concerned ministers, with the consent of the Ministry of Labor, War Invalids and Social Affairs.

Article 12.- The dossier for application for establishment of a job placement center is composed of:

1. An application to establish the job placement center;

2. The plan for the job placement center, which must clearly indicate the need, objective, tasks and conditions for the implementation of the set objectives and tasks.

Article 13.- Within 30 days from the date of the decision for its establishment, the job placement center shall publish an announcement on local papers in five consecutive issues, providing the name of the center, its location, telephone number, bank account, its director, date of establishment, date of operation and its main fields of activity.

The original decision to establish the center must be sent to the Ministry of Labor, War Invalids and Social Affairs, the Government Commission for Organization and Personnel and the Ministry of Finance.

1. The sources for revenue and expenditure of the job placement center include:

a) Revenue:

- Fees, tuition and other charges;

- Placement contracts from the State, units and individuals;

- Support from the State;

- Financial support of organizations and individuals inside and outside the country;

- Other sources.

b) Expenditure:

- Construction, maintenance and development of technical and material bases;

- Purchases of materials and facilities for vocational training;

- Salary and wage for managerial personnel;

- Other expenditures.

2. The job placement center is eligible for consideration for tax reduction and exemption in accordance with the provisions of law.

3. The Ministry of Finance shall provide guidance on the financial management regime for the job placement centers in accordance with the State regime for financial management.

Article 15.- The job placement centers which were established prior to the date of issuance of this Decree must be re-established in accordance with the provisions of this Decree and the guidance of the Ministry of Labor, War Invalids and Social Affairs.

Article 16.- The Ministry of Labor, War Invalids and Social Affairs shall provide the uniform State management as stipulated by Item 3, Article 18, of the Labor Code, with regard to job placement organizations throughout the country according to the following contents:

1. To issue the provisions on organization and operation of the job placement centers;

2. To approve the establishment of the job placement centers;

3. To provide guidance and inspect the operation of the job placement centers according to the provisions of law;

4. To study, design, amend and supplement provisions and policies regarding the job placement centers.

1. The Ministry of Finance shall study and design for submission to the Government the policies for financial support and tax reduction and exemption to encourage laborers to seek self-employment and generate employment for many other laborers.

2. The State Bank of Vietnam has the responsibility to study and design loans schemes to encourage self-employment among laborers and to generate employment for many laborers.

3. The Ministry of Science, Technology and Environment shall study and design policies to encourage the development and application of new technologies and trades in order to generate employment for many laborers and to encourage self-employment among laborers.

Article 18.- The Committee on Ethnic Minorities and Mountainous Areas shall preside over and consult the Ministry of Labor, War Invalids and Social Affairs and the Ministry of Finance on policies of preferential treatment in employment so as to attract and employ laborers of ethnic minorities.

Chapter II

RECRUITMENT OF LABOR AND PROVISION OF UNEMPLOYMENT ALLOWANCE DUE TO RESTRUC- TURING OR NEW TECHNOLOGY

Article 19.-

1. The laborer has the right to work for any employer and in any place not restricted by law.

2. The dossier for job application comprises: an application for employment and the employment record as stipulated by the Ministry of Labor, War Invalids and Social Affairs.

In case the laborer has not yet an employment record, he/she must have a curriculum vitae, a skill certificate and other related papers as requested by the employer.

Article 20.- In recruiting laborers, the employer has to publicize in full the conditions for recruitment as well as the rights and responsibilities of both the employee and employer in the course of employment.

Article 21.- The recruitment of Vietnamese laborers in accordance with the provision of Item 1, Article 132, of the Labor Code, to work at enterprises which are established under the Law on Foreign Investment in Vietnam, at export processing zones, industrial parks, foreign agencies and organizations, or at international organizations in Vietnam, or to work for individuals who are foreigners in Vietnam, shall be conducted as follows:

1. Through the selection or recommendation of a job placement center as provided for in Article 10 of this Decree, at the request of the interested enterprise, organization or individual.

The fee for the selection or recommendation of laborers shall be paid once by the employer at a level to be agreed upon by the two parties but which shall not exceed:

- 5% of the salary of the first month as prescribed in the labor contract for each employee recruited through recommendation.

- 8% of the salary of the first month as prescribed in the labor contract for each employee recruited through commission.

The procedure and dossier for employment shall be defined by the Ministry of Labor, War Invalids and Social Affairs.

The recruitment of employees for offices of the diplomatic corps shall be defined jointly by the Ministry of Labor, War Invalids and Social Affairs and the Ministry for Foreign Affairs.

2. In case the job placement center files a written statement that it cannot meet the requirements of the employers in selecting or recommending laborers, the requesting enterprises, organizations and individuals have the right to recruit laborers directly, but must notify the Labor, War Invalids and Social Affairs Service.

3. After each recruitment of employees, the requesting enterprises, organizations and individuals shall report the results to the Labor, War Invalids and Social Affairs Service.

Article 22.- In January and July every year, the employer shall report to the Service of Labor, War Invalids and Social Affairs Service at the locality where he/she maintains the head office on the situation of employment, the need for additional labor and the implementation of the labor policies. The report shall be done in the forms issued by the Ministry of Labor, War Invalids and Social Affairs.

Article 23.- The following cases are referred to as restructuring or renewal of technology as stipulated in Item 1, Article 17, of the Labor Code:

1. To replace part or all the old technologies with equipment and machinery of higher productivity;

2. To change a number of or the whole production process with more advanced and more productive processes;

3. To change products or the products structure, resulting in a less intensive use of labor;

4. To use advanced technology which gives higher productivity and quality in replacement of backward technologies;

5. To change the organizational structure: Merger or dissolution of a number of sections in the unit.

If these changes lead to the unemployment of the laborers, the employer shall have to retrain the laborers for new jobs. If no new employment can be found for the laid-off laborers, the employer shall pay severance allowance to the laborers in accordance with the provisions of Item 1, Article 17, of the Labor Code, and Articles 24 and 25 of this Decree.

Article 24.- The bases for calculating severance allowances are stipulated in Item 1, Article 17, of the Labor Code.

1. The salary level to calculate severance allowances is defined in Decree No.197-CP of December 31, 1994, of the Government which provides details and guidance for implementation of a number of Articles of the Labor Code on wages.

2. The time frame for calculating the severance allowance is the period in which the employee works continuously for the employer until the severance.

In case the employee for a State-run enterprise loses his/her employment as stipulated in Item 1, Article 17, of the Labor Code and Article 25 of this Decree, and he/she had previously worked in other units of the State sector where no severance allowance had been granted, that period of employment are also accounted for to calculate the severance allowance which is equivalent to half the monthly salary for each year of work. This amount shall be transferred from the old units to the unit where the employee is working and paid out to him/her. In case the old unit has been dissolved, the allowance shall be paid by the State budget. The unit where the employee is working shall pay the severance allowance and shall get refund from the State budget.

3. The period of work with spilled-over time:

a) The spilled-over time of less than a month is not accounted for.

b) A spill over from one month to less than seven months is taken as six months of work.

c) A spill-over from a full seven months to 12 months is taken as a year of work.

Article 25.-

1. In case many laborers become unemployed as stipulated in Item 2, Article 17, of the Labor Code and Article 23 of this Decree, the payment of severance allowances shall follow the following order:

a) People who volunteer to retire;

b) People who have committed acts of violation of the labor discipline which are not so serious to be fired;

c) Young and healthy people who have skills and the capability to find new jobs elsewhere;

d) People under policy entitlements: Heroes of the Armed Forces, Heroes of Labor, war invalids, diseased soldiers, people with policy entitlements as a war invalid, dependents of fallen heroes, people with good records in the wars of resistance and people with meritorious services to the Revolution.

2. The payment of severance allowance to the laborers shall be made within seven days at the latest from the date of the job severance.

3. The severance allowance must be paid in lump sum to the laborer at the place of work or at a place most convenient for him/her.

Article 26.- All enterprises shall set up a reserve fund for job severance allowances as provided for in Item 3, Article 17, of the Labor Code:

a) The source for this reserve fund for job severance allowances is taken from the remaining profit of the enterprise after fulfilling all obligations toward the State. The Ministry of Finance and the Ministry of Labor, War Invalids and Social Affairs shall provide guidance for the management of this fund.

b) The fund is to be spent on the following main purposes:

- To pay severance allowances for laborers working in the enterprise who are losing employment.

- To pay for the retraining cost due to restructuring or renewal of technology; to cover the training of backup skills for women laborers in the enterprise and to enhance the professional skills of laborers.

c) The enterprise is responsible for the management, use and development of the fund in accordance with the provisions of law.

Chapter III

IMPLEMENTATION PROVISIONS

Article 27.- This Decree takes effect from the date of its signing. The previous provisions which are contrary to the Labor Code and this Decree are now annulled.

Article 28.- The Ministry of Labor, War Invalids and Social Affairs, the State Planning Committee, the Ministry for Foreign Affairs and the other Ministries and branches shall, within the scope of their functions, tasks and powers, have the responsibility to guide the implementation of this Decree.

Article 29.- The Ministers, the Heads of the Agencies at ministerial level and Agencies ttached to the Government, and the Presidents of the People's Committees of the provinces and cities directly under the Central Government, are responsible for the implementation of this Decree.

On behalf of the Government

For the Prime Minister

Deputy Prime Minister