Obligations of the Employer in Cases of Organizational or Technological Changes, or for Economic Reasons
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The following cases are considered organizational or technological changes:
a) Change of organizational structure, labor reorganization;
b) Change of production or business processes, technology, machinery, equipment associated with the employer’s business lines or industries;
c) Change of products or product structure. -
The following cases are considered for economic reasons:
a) Economic crisis or recession;
b) Implementation of State policies or laws when restructuring the economy or implementing international commitments. -
In case organizational or technological changes affect the employment of multiple employees, the employer must develop and implement a labor utilization plan in accordance with Article 44 of this Code; where new jobs are available, priority shall be given to retraining employees for continued employment.
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In case multiple employees are at risk of losing their jobs or being laid off for economic reasons, the employer must develop and implement a labor utilization plan in accordance with Article 44 of this Code.
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Where the employer cannot provide employment and must terminate employees, the employer shall pay job-loss allowance in accordance with Article 47 of the 2019 Labor Code.
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Termination of employment under this Article shall only be carried out after consulting with the employee representative organization at the grassroots level where such an organization exists and the employee is a member, and after giving at least 30 days’ prior notice to the provincial People’s Committee and to the employees.
Labor Utilization Plan
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A labor utilization plan must contain the following principal contents:
a) The number and list of employees to continue working, employees to be retrained for continued employment, and employees to be transferred to part-time work;
b) The number and list of employees retiring;
c) The number and list of employees whose labor contracts must be terminated;
d) Rights and obligations of the employer, employees, and related parties in the implementation of the labor utilization plan;
đ) Measures and financial sources to ensure implementation of the plan. -
When developing a labor utilization plan, the employer must consult with the employee representative organization at the grassroots level where such an organization exists. The labor utilization plan must be publicly communicated to employees within 15 days from the date of its adoption.
Legal basis: Articles 42 and 44 of the 2019 Labor Code.
