For most business owners and managers, the most challenging aspect to doing business in Vietnam is probably about managing its workforce. In addition to cultural and language barriers, foreign investors have to deal with very restrictive labour laws which are clearly in favour of employees.

Vietnam’s labour system is set in such a way that any form of discipline has to be based on written rules, rather than what we sometimes call “common sense”. Even in cases where company rules have been breached, complex procedures need to be strictly followed, as dictated in the laws, or otherwise face failure. The fact that employers only win in 7% of all labour cases brought to Vietnamese courts clearly show that only a handful of companies fully understand Vietnam’s labour system.