LEARNING ENGLISH WITH FDVN'S NEWSLETTER NO. 02/2021

LAW PROVISIONS ON AUTOMATIC TRANSFORMATION OF LABOR CONTRACT – PART 2

QUY ĐỊNH PHÁP LUẬT VỀ CHUYỂN HÓA HỢP ĐỒNG LAO ĐỘNG – PHẦN 2

(Lawyer Tran Thi Hau – FDVN’s Newsletter No. 3)

I. VOCABULARY IN USE:

Currently, there are 02 different viewpoints as follows:

The first viewpoint (quan điểm) is that a new labor relationship has arisen between the 2 parties since the old labor contract expired. The definite-term contract has been transformed into an indefinite-term contract and a seasonal contract has been transformed into a definite term contract. The time for signing a new labor contract between the 2 parties is 30 days from the date on which the old labor contract expires.

The second viewpoint is that only when 30 days after the labor contract has expired and the new one is not signed while the employee continues working for the employer can the automatic transformation (sự chuyển hóa tự động) happen.

In reality, there are many disputes arising from this issue, and the viewpoints of the First-instance (Sơ thẩm) and Appellate (Phúc thẩm) Courts (cả cụm từ: Tòa án cấp Sơ thẩm và cấp Phúc thẩm) are also different. Even when the Appellate Judgment (Phán quyết phúc thẩm/Bản án phúc thẩm) was canceled by a Cassation Decision (Quyết định giám đốc thẩm), the Appellate Court does hold up their point of view (giữ nguyên quan điểm xét xử) and objects to the Cassation Decision.

In the author’s opinion, the second point of view is more reasonable than the first one. It is necessary to understand that the period of 30 days after the expiration of the contract is regulated by law so that both parties can consider signing the new labor contract or terminating the labor relationship. Within 30 days, the issues between the two parties will be solved under the old labor contract, according to Decree 44/2003/ND-CP.  If the labor relationship is terminated, the terms and conditions of the old labor contract will be applied.

Provision on transformation of labor contract in Labor Code 2019 is suitable for the labor contract classification:

According to Article 22 of the Labor Code 2012, there are 3 types of labor contracts (loại hợp đồng lao động) as follows: indefinite-term, definite-term contract and seasonal or work-specific labor contract with a term of less than 12 months.

According to the Labor Code 2019, there is a change in the classification of labor contracts. Under Article 20 of this Code, there are two types of contracts which are indefinite-term contract and definite-term contract with the term of less than 36 months from the day on which the labor contract takes effect (the day on which + clause: vào ngày mà + sự kiện, sự việc).

The aforementioned change leads to the change of regulation on the contract transformation when it expires but the employees continue working for the employer.

 1. Within 30 days after the labor contract expires, the two parties must sign a new labor contract. During the time when a new labor contract has not been signed, the rights, obligations, and interests of both parties will be performed according to the signed contract.

Thus, the provisions of the Labor Code 2019 have supplemented the ones of Labor Code 2012 and inherit the provisions of Decree 44/2003/ND-CP at the same time. In particular, a contract entered into prior to its expiration (hợp đồng được ký trước khi hết hạn) will be applied to settle the rights, obligations, and interests of both parties within 30 days after the expiration date.

2. A definite-term contract will become an indefinite-term contract if the new labor contract is not signed after 30 days.

The two parties are allowed to sign a new labor contract, which is a definite term contract, for only one more time. There is no regulation on the term of this contract, so we can understand that the longest term will be 36 months instead of 24 months under the Labor Code 2012.

Thereafter, if the employee keeps working for the employer, an indefinite-term labor contract must be signed, except for the following cases:

- Labor contracts with directors of state-invested enterprises (Doanh nghiệp nhà nước);

- Labor contracts of elderly people according to Clause 1, Article 149 of Labor Code 2019;

- Foreign employee’s labor contract with the term less than the duration of work permit (giấy phép lao động) under Clause 2, Article 151 of the Labor Code 2019;

- Labor contract with a member of the management board of the representative organization of employees according to Clause 4 Article 177 of the Labor Code 2019.

It can be understood that the Labor Code 2019 implicitly acknowledges an additional type of labor contract which is a definite-term labor contract for the position’s tenure or specific job. Thereto, the regulation on the contract term is no longer “rigid” with the compulsory term of 36 months or indefinite-term but more flexible in the according to the nature of the job, complying with work permits, or according to the term of work...

It can be seen that the law provisions on the labor contract transformation are gradually improving from time to time on the basis of inheriting the previous regulations and expanding the options for the parties involving in some particular cases. In our opinion, this option also aims to create the solution for the cases where the employer deliberately violated the law (cố tình vi phạm pháp luật) and the proactive settlement on the basis of practical legal provisions.

II. EXPLANATION AND DEMONSTRATION:

1. About Courts: Về các Tòa án

- First-instance People’s Court: Tòa án cấp sơ thẩm

- Appellate People’s Court: Tòa án cấp phúc thẩm, được mở khi có appeal (kháng cáo) được accept (thụ lý).

- Collegial/Higher People's Court: Tòa án cấp cao

- Supreme People's Court: Tòa án tối cao

2. Judgments, decisions: Bản án, quyết định của Tòa án

- Criminal/Civil Appellate Judgment: Bản án hình sự/dân sự phúc thẩm

- Criminal/Civil First-instance Judgment: Bản án hình sự/dân sự sơ thẩm

=> To uphold the whole Civil First-instance Judgment: Giữ nguyên bản án dân sự sơ thẩm

- Cassation/reopening decisions: Quyết định giám đốc thẩm/tái thẩm

=> The judgment is reviewed according to the cassation or reopening procedures: Bản án được xem xét theo thủ tục giám đốc thẩm hoặc tái thẩm

- Decision to institute the cassation procedure: Quyết định kháng nghị giám đốc thẩm

- Sentences and rulings in effect: Bản án, quyết định đã có hiệu lực

=> To protest sentences and rulings in effect through the cassation procedure: Kháng nghị giám đốc thẩm đối với bản án, quyết định đã có hiệu lực.

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